ACADEMIA DE STUDII ECONOMICE DIN BUCUREŞTI

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

Internship Report
-graduation-
1. Description of the company :

Engie SA is a French multinational electric utility company, headquartered in La Défense,

It is one of the few players in the sector to develop expert skills in both upstream (engineering,
purchasing, operation, maintenance) and downstream (waste management, dismantling) activities.

Engie supplies 27 countries in Europe and worldwide 48 countries with electricity.

Since 2014, ENGIE has operated a strategic shift, by reducing future exploration in fossil fuels
and investing massively in renewable energies (solar, wind, geothermal, biomass, hydroelectric,
and nuclear) and energy efficiency services.

In 2015, ENGIE announced its decision to stop new investments in coal plants and to dispose of
€15 billion in assets in order to reinvest into projects that promote low-carbon, distributed-energy.
ENGIE also announced it will invest €22bn in renewable energies, energy services such as heating
and cooling networks, and decentralized energy technology.

In 2016, Isabelle Kocher defines the strategy of ENGIE as follows: to promote decarbonized
energy (oil and coal replaced by renewables and natural gas that emit less greenhouse gases),
decentralized energy (energy produced and stored as close as possible to its place of consumption),
and digitized energy (big data and digital tools for energy efficiency and network management).
The Group creates ENGIE Digital and plans to invest €1.5 billion on digital and new technologies
related to energy.

ENGIE is also promoting an open innovation approach with its dedicated entity "ENGIE Fab" that
supports in particular development of intelligent networks (smart grids), Internet of objects, green
mobility, energy storage, and hydrogen.
 ACADEMIA DE STUDII ECONOMICE DIN BUCUREŞTI

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

Between 2016 and 2018, ENGIE invested €15 billion in new activities, financed by the sale of coal
and upstream oil and gas.

2. Mission, view, objectives :

• Participates in the substantiation of the acquisition strategy and follows its implementation;

• Knows the acquisition strategy and participates in its implementation;

• Follows the creation, maintenance and development of relations with the allocated natural
gas suppliers, meant to facilitate communication and obtaining information in order to
achieve the interests of ENGIE Romania SA;

• Participates in the realization of transport and storage programs;

• Responsible for the allocated portfolio of natural gas suppliers, aiming at contracting the
appropriate sources for ensuring the commercial and physical balance of the portfolio in
conditions of profitability;

• Responsible for the development in good conditions of the natural gas acquisition contracts
from the allocated portfolio, following compliance with contractual clauses and legislation;

• Responsible for identifying and evaluating adequate natural gas suppliers in accordance
with internal rules of the company;

• Responsible for negotiating the contractual conditions for the allocated portfolio of natural
gas suppliers, within the limits competence room;

• Responsible for drawing up and concluding contracts with the allocated natural gas
suppliers, following the observance legislation and internal procedures;

• Adjusts contracts according to legislative changes, price variations, portfolio fluctuations,

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

• Solves the problems appeared in the development of the contracts from the portfolio of
allocated suppliers, following amicably resolving them, avoiding penalties and the interests
of the company;

• Participating in the development of legislation and regulations in the field with the impact
of its activity;

3. External analysis of the company

ENGIE Group was formed as a result of a merger among several companies. Such companies
include Compagnie Universelle de Belgique, Gaz de France and international and some other
companies. ENGIE is a French multinational company dealing in electric utilities. Headquarter of
the company is in La Defen* France. The company is doing business in energy generation, and
distribution of such energy resources. Resources such as renewable energy, nuclear energy, natural
gas, and petroleum.

The company is listed in the Euronext stock exchange in Paris and Brussels. Its stock value is
14.50 EUR as per 05-Dec-2019. The company is founded in July-2008. The CEO of the company
is Isabelle Kocher. This company owns total assets of EUR 153.7 billion. Total revenue of almost
EUR 60.06 billion according to the annual report of 2018. This company is doing operations in
almost 70 countries of 5 different continents, across the world. The government of France has a
24% share in its ownership. The total number of employees in an organization is 160,000. Its main
subsidiaries are ENGIE Axima, ENGIE Ineo, ENGIE Endel, ENGIE Fabricom, ENGIE Home
Services, ENGIE Global Markets, and some others. [1]

Threats of New Entrant

The energy industry is one of the worst sectors for new entrants. Due to its nature and scale of
production. There are several entry and exit barriers that exist in the industry. These barriers
include high starting cost due to large scale production and distribution channels. A monopoly of
existing groups in a market is also a barrier.
 ACADEMIA DE STUDII ECONOMICE DIN BUCUREŞTI

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

Another barrier is long procedures because the company has to follow rules and regulations,
different approvals have to be taken from the government. Therefore, it is a time consuming and
complex process.

Similarly, current corporations are innovating themselves to create a competitive advantage. Engie
is more focused on generating energ from other substitutes of carbon. The company generates of
low carbon dioxide sources. The government is regulating the industry so companies have to be
environmentally friendly. Current companies created barriers for new entrants by using economies
of scale. Therefore threats of new entrant in this industry is very low. [2]

Threats of Substitute

Engie is generating energy through low C02 sources. Similarly, companies are using different
strategies to create a competitive edge over others. As the product is the same due to which every
company is willing to be a buyers priority. So, strategy can be cost reduction to offer fewer prices
in the market. Strategy can be vertical integration etc. Therefore, threats of substitutes exist in the
market. In the case of Engie, it is low because the company is using various methods of generating
energy that gives a competitive edge to the company. [2]

Bargaining Power of Buyers

When we talk about Engie, the bargaining power of the buyer is low because there are large number
of buyers across the borders. Similarly, the bargaining power of buyers in this industry is low
because there are a large number of buyers in the market. Different substitutes are offered, but the
demand for this industry is not disturbed because it is one of the basic needs in todays world. Buyer
as an individual cannot bargain with different large groups such as Engie.

Bargaining Power of Suppliers

In the current scenario, the bargaining power of the supplier exists in the market due to which
every company is trying to reduce its expenses by reducing the cost of transportation and
automation in operations. Similarly, companies are doing vertical integration to save resources.
Different companies are using several other methods to generate energy such as, wind energy•,
nuclear energy, etc. Therefore all of these factors are reducing the current bargaining power of
suppliers gradually.

Competitive Rivalry
 ACADEMIA DE STUDII ECONOMICE DIN BUCUREŞTI

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

Every company is targeting the same type of customers in the market. There is no such diverse
segments in the market. There are a few numbers of sellers and a large number of buyers. Price
change by any company affects other companies. The product of the company is almost the same
due to which every company is trying to increase its customers by creating a competitive edge
over others. Different companies are going towards mergers to become more influential and
increase

4. Internal analysis of the company – Strengths & Weaknesses

Strengths of Engie

Distribution and Reach: Engie has a large number of outlets in almost every state, supported by a
strong distribution network that makes sure that its products are available easily to a large number
of customers in a timely manner.

Cost Structure: Engie’s low cost structure helps it produce at a low cost and sell its products at a
low price, making it affordable for its customers.

Dealer Community: Engie has a strong relationship with its dealers that not only provide them
with supplies but also focus on promoting the company's products and training.

Financial Position: Engie has a strong financial position with consecutive profits in the past 5
years, along with accumulated profit reserves that can be used to finance future capital
expenditures.

Engie has a large asset base, which provides it with better solvency.

Return on Capital Expenditure: Engie has been successfully able to generate positive returns on
the capital expenditure it has incurred on various projects in the past.

Weaknesses of Engie

Research and Development: Even though Engie is spending more than the average research and
development expenditure within the industry, it is spending way less than a few players within the
industry that have had a significant advantage as a result of their innovative products.
 ACADEMIA DE STUDII ECONOMICE DIN BUCUREŞTI

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

High Day Sales Inventory: The time it takes for products to be purchased and sold are higher than
the industry average, meaning that Engie builds up on inventory adding unnecessary costs to the
business.

Rented Property: A significant proportion of the property that Engie owns is rented rather than
purchased. It has to pay large amounts of rent on these adding to its costs.

Low current ratio: The current ratio that shows the company’s ability to meet its short term
financial obligations, is lower than the industry average. This could mean that the company could
have liquidity problems in the future.

The company has low levels of current assets compared to current liabilities, and this can create
liquidity problems for it in operations.

Cash flow problems: There is a lack of proper financial planning at Engie regarding cash flows,
leading to certain circumstances where there isn’t enough cash flow as required leading to
unnecessary unplanned borrowing.

Integration: Engie's current structure and culture have resulted in the failure of various mergers
aimed at vertical integration.

5. Responsabilities

• Ensures the purchase of the necessary quantities of natural gas based on the contracts
signed with the allocated suppliers,

• nominates the sources to the authorized partners / institutions, following the observance of
the flexibility clauses and contractual / legal terms;

• Analyzes the contractual proposals received from the allocated suppliers in order to
identify the risks generated by the implementation of disadvantageous clauses for ENGIE
Romania SA; ensure their treatment and maximizing the company's interests;

• Permanently monitors and analyzes the development of contracts with partners in terms of
performance contractual clauses;

• Analyzes the internal and external correspondence received, and prepares the necessary
commercial correspondence for: obtaining offers / contractual proposals from suppliers,
 ACADEMIA DE STUDII ECONOMICE DIN BUCUREŞTI

FACULTATEA DE ADMINISTRAREA AFACERILOR, CU PREDARE IN LIMBI STRĂINE

Calea Griviţei nr. 2-2A; tel.: +40 21 319.19.00, +40 21 212.19.01,

www.fabiz.ase.ro

negotiating and managing contracts, optimization of contracts, settlement of contractual

• Ensures a strategic communication with suppliers aiming at achieving the interests of the
company and obtaining useful information in carrying out the activity;

• Negotiate prices, payment conditions, guarantee as well as other essential elements of the
contracts in accordance with the company's strategy for the allocated portfolio of natural
gas suppliers;

• Makes the correspondence generated by the implementation of the legislation as well as

• Knows the necessary documentation for registering the purchase / sale orders issued by
ENGIE Romania SA on centralized natural gas markets;

• Knows and respects the legislation in the field of activity. Participates in making
amendments regarding the legislation in force, as well as the one subject to consultation by
the regulatory authority, as well as by others authorized institutions;

• Participates in the reporting to management, the internal departments with which it

• Analyzes and makes proposals to modify internal processes and procedures following the
update and streamlining the way of working within the department;

• Maintains the confidentiality of data against unauthorized persons;

Date:06.06.2021

Niculae Razvan Ion