I’m doing fine

Zdenek Bakala is not as wealthy as he was. He should be anxious, but he’s not. He’s looking better than he did and he’s certain of his ability to manage the Ostrava region crisis that has lately confronted him. Zdenek Bakala is either a good actor or someone who is seriously and coolly on top of things. When the hard coal mining crisis struck his mines in the Ostrava region, once the jewel in his business crown, billions [of crowns] were on paper wiped off his wealth. He is pouring hundreds of millions into his newspaper business in Prague. And he has lost weight. But it is not down to stress. It seems that Zdenek Bakala is perfectly fine with things. Though perhaps with the small exception of raising the topic of coal. Before the interview even begins, he makes it clear several times that he doesn’t want to talk about that too much. Whenever the discussion turns to coal, his body language is pretty clear: it is certainly not a pleasant issue for him. It could in fact hardly be so – the share price of NWR, of which Bakala today holds about one-third, has suffered a dizzying nosedive on stock exchanges. One brief look at the charts tells you that words are not necessary. Take the crises that have befallen the steel and construction industries, and the cheap coal from the US pushed out of the country by even cheaper shale gas, then couple those things with the skyrocketing costs of coal mining in the Ostrava region, and you see why the NWR name has been turned into something of a nightmare. New World Resources or NeWeR again? [in Czech, ‘NeWeR’ would be pronounced ‘NeVeR]. Those who purchased the stock when it first hit the exchanges (i.e. in 2008 when it produced the biggest IPO in London!) at a cost of CZK 400 per share now possess stock worth a mere CZK 20 a share. And worse is expected: Bank of America estimates the target price as at around CZK 5. The once prestigious stock is off the FTSE 250 index and both shareholders of NWR and employees of OKD, the actual mining company, are in for a very bumpy ride. The ‘global’ name of New World Resources is of course a front for the rather regional OKD, or Ostravsko-karvinské doly, a subsidiary of NWR that is set to enter purgatory. There will be layoffs of hundreds and perhaps thousands of employees, and mines and operations will be up for sale. But as Zdenek Bakala says, he does not himself equate to NWR, he is merely just one shareholder (albeit the biggest one). And likewise, NWR does not equate to Bakala. Some 90 percent of his assets are currently said to stem from other things. Yet, when the stock of NWR still commanded a share price of CZK 80 during the winter, his stake still made up almost one-quarter of his total wealth. In addition to coal from the Czech Republic, Zdenek Bakala’s portfolio today includes iron ore from Ukraine, mangoes from Malawi, land in Mozambique, farms in Brazil, assisted reproduction centres in England, a mattress merchant in Canada, residential complexes in Houston, Texas, a sports academy in Leuven, Belgium, a top professional cycling team in the same country, Hospodářské noviny daily newspaper in the Czech Republic and some 44,000 residential flats in the Ostrava area. Which of these assets turn a profit and which of them cause one of the best known Czech businesspeople and investors to lose a little sleep? Zdenek, what are you currently paying closest attention to? The Tour de France, Czech politics or coal? Actually, all three, but each in its own way. But which comes first for you? Coal, probably, at the moment. It is where I am exposed the most in terms of investments and it is also a business that is currently going through a dramatic cyclical crisis. However, this time around the crisis is more pronounced than before, due to a number of generally well known reasons. I’m really enjoying the cycling and with both of our teams achieving good results it is really good fun. But I enjoy plenty of other things as well. Politics, especially in the Czech Republic, is frankly not something to be enjoyed, although I must admit that it has lately taken on a certain entertainment value that was not there in previous times. Lets begin with the coal business and have it out of the way, shall we? Why not. But you are well aware that due to [stock market] regulations there is not all that much I can actually tell you… What has happened to get NWR into such a state? Investments in OKD have been, in essence, a bet on the price of coal. Mining for coal in the Ostrava region is expensive which maximises the sensitivity of the business to coal price fluctuations. And we currently find ourselves in a dramatic downturn in the periodic cycle, which is by the way the third in the past two decades. This downturn has been exacerbated by the fact that the fuels markets have come under the very strong influence of shale gas and crude oil. Prices have been falling on the energy market and when for example you take the production of thermal coal in the Czech Republic you discover that revenues are failing to any longer match the costs. As a result you have on the one hand a company that is by definition maximally sensitive to price fluctuations and on the other you have a dramatic slump in prices, which although cyclical has been aggravated by the shifting situation on the global energy market. So we know the causes of the situation. But have you not made mistakes in managing NWR? Isn’t there something company management may have underestimated? Anyone who keeps an eye on the company developments is fully aware of the declining quarterly results but when you look just across the border at the Polish mines they are not doing so badly. This is of course something I cannot comment on publicly. However, when you take the Polish mines you have to take into account the fact that the Polish state holds a stake in the mines and that the Polish government also exercises a highly positive and extensive support scheme for the industry. Historically, mining has been one of the most important and biggest industries in Poland. And when you look at JSW in particular, you will see that the company benefits from a very high proportion of coking coal in its product mix, offsetting the price falls on the thermal coal market. At the beginning of the year you appointed new people to manage your activities in the Czech Republic. You have lately been returning here more often too. Is it correct to assume that you wish to exercise closer control over what happens with your assets in the country? Yes, but these activities are mostly concerned with entities outside the BXR Group. The BXR Group is our investment entity via which we hold stakes in NWR, the apartments and rail freight transporter AWT. These activities will continue to be managed in a standard fashion though their respective holding structures. There are other shareholders and professional management teams for each. We are starting to focus more on our activities beyond the BXR Group. These include mainly non-profit organisations, some smaller investments, and [media house] Economia. Perhaps a bit of a bothersome question now: Does this all mean that you maintained weaker control over these activities before? It means that some three or so years ago I decided to reduce my involvement in business and devote more time to other things such as my family and hobby investments. As time went by, this led, in my opinion, to these companies and non-profit organisations lacking a unified management structure and suffering from a lack of a centralised approach with decisions being taken in a rather ad hoc fashion as and when I had the time to deal with them. It transpired over time that this lack of coordination and inability to forward-plan decisions was detrimental and that is why we decided to create an umbrella structure named BM Management, with Kamil Čermák at the helm; it is designed to improve the management of these assets. … So you will be coming to the Czech Republic more often then? I have been returning to the Czech Republic three or four times a month for the past year. Are you saying that this increased personal involvement of yours and the management changes are unrelated to the coal business crisis? There is no link to coal. I am by no means an industry manager, and even less an industry manager that knows something about coal production. I am no coal baron. We are trying to understand your thought processes. To see if during this time when NWR has become lossmaking and has started to rather quickly burn through cash you have begun paying more attention to your profitable activities? Of course, there is someone turning to such work but it is not me personally. We keep our faith in a positive long-term outlook for NWR. We have been through a similar situation twice in the past 20 years. It is a situation that has to be expected in the mining business. The cyclical nature is part and parcel of it and investors invest in mining companies with the understanding that the risks of cyclical downturns exist for the industry. By the way, mining companies worldwide have cancelled about 56 development projects over the past 12 months, including giant projects worth billions of dollars in Mozambique. So this situation is not unusual in the sense that it has never occurred at all before or that investors would be unwilling to accept the risks of investing in mining assets. We do not share the feeling that all investors were prepared for the developments. Ranks of investors, including some here in the Czech Republic that we have had a chance to talk to, were taken by surprise by the negative developments concerning NWR. An investor can never be entirely prepared for the developments of a single stock on the market but, in general, investors in the mining industry are aware that they are putting their money into a volatile cyclical business. In the case of NWR in particular investors know that they are investing in a stock with an exceptionally high correlation with coal prices due to the company’s operating demands. You managed to pull off one of the most successful IPOs of the time when you listed NWR on the London and Prague stock exchanges. People paid CZK 400 per share. But now they’re traded at around CZK 20. It will come as no surprise to you that many people now hold a grudge against you. Can you explain to them what has happened to their investment? First of all, you have to look at the broader picture. NWR shares have already made some serious money for many investors. It is not necessarily the case that a person purchases shares at the IPO and holds on to them for the life of the stock, simply chalking up profits along the way. Many people acquired NWR shares at the time of the previous slump to CZK 75 and multiplied their investment by a factor of three or four. This is not a hairdressing business which I one day bought for say CZK 100,000 and 10 or 50 years later when I decide to retire I simply count my profit. Just take a look at Apple: it is down some 35 or 40 percent compared to its record highs and it all happened over a relatively short period of time. The stock market is volatile, and even more so at a time like this. Stock is by its nature the riskiest element in the capital structure of any company. That is all very well, but NWR has sunk so much more than that and the value of your own shareholding has shrunk from seven billion crowns to less than two… What are you going to do about it? I went to a two-day meeting of NWR management in Ostrava in mid June. Due to its operating demands, NWR is now rather lowly valued by the markets, just like with the other mining firms. That is a fact. Another truth is that the company needs to substantially redefine its business model in order to become successful again in the future. Both NWR and OKD have developed a transformation programme that redefines the OKD operations, including administration, cutting the number of management levels, planned reductions in personnel costs, and so on. Secondly, the project extends the NWR business into trading coal and commodities in general, so NWR begins to build a trading organisation with ambitions to satisfy the complete range of needs of consumers of coking coal of all types. How long will the plan take to implement? The plan is divided into several stages with the urgent phase taking place by the end of this year. Overall, we are talking roughly 24 months before all elements of the plan have been put in place. This sounds a lot like what you were stating at the end of the first quarter. And the market did not believe in what you were saying. Bank of America has dropped its target price for NWR shares to CZK 5.70, the share price is still going down… Isn’t it time to come up with a bigger plan? We are perfectly well aware of the market’s negative reaction. It holds true that we must put 100 percent of our effort behind restructuring OKD. Nevertheless, NWR considerably benefits from having a single, stable controlling shareholder, the BXR Group, which is fully behind the transformation. So there is no need for short-term, unnecessary responses to stock market developments. So if the need arises, the shareholder would provide the necessary cash to put in… NWR has enough cash and that is what enables it to avoid having to respond to the daily stock market developments. We must manage the company in a way that conforms to a strategic vision, enabling it to pull through these difficult times without worrying about short-term market fluctuations. Let me ask again then: will there be something bigger than what you announced after the first quarter? Reducing our costs is just one element here and reducing pay is just one entry on a list of hundreds entries aimed at cutting costs. The essence of the restructuring lies elsewhere. NWR will begin supplying coal from producers other than OKD. OKD will become a more centralised and flatter organisation with a leaner management. In order to survive we need a reduction of personnel costs of 10 percent by the end of this year. And more profound changes are in the pipeline. Will the coking plant and Paskov mine be sold? Yes to the coking plant, we have already entered into negotiations with potential investors for OKK. The future of Paskov is subject to an ongoing analysis. And this is a current official statement: Other assets, in addition to the stated two, are also subject to review. Is it a good idea to invest in NWR stock now? This is a question I cannot answer due to regulation, but you know that very well… What will cost reductions at OKD mean in terms of the whole region? It is clear that redundancies will have to be made. You have to bear in mind that the region is propped up by five companies: OKD, ArcelorMittal, Vítkovice, Evraz and Třinecké železárny. That is five businesses and all have been affected to a greater or lesser degree by the current crisis. And if any of the links of this chain breaks, the others will be in considerable trouble. In other words, the battle for OKD is not about a single, isolated company, it is a battle for the future of the whole region. When we visited Vítkovice in the spring we got the feeling that [the owner] Jan Světlík is well liked by the people of Ostrava and is praised for all he has done for the city. On the other hand, Zdenek Bakala seems to be perceived as the polar opposite. Doesn’t it make you cross? One can’t avoid this. All the past owners of OKD have been in the same position, including the Czechoslovak Socialist Republic. OKD has always played the role of being the focus of anger, the entity that can be blamed for everything. I tend to consider all this rather as folklore than something that is today actually relevant. Perhaps a contributing factor is the recent events surrounding the former OKD flats. Is it true that you have been looking for an outside investor for the property? Are the flats in effect up for sale? Let me be understood correctly. All I am saying is: this is an investment that has matured to a level where we can reflect on a sale. There’s nothing more to it. Is there yet an offer? The trouble is that you keep suspecting that I am the one, and the only one, behind each decision, every move. But that is simply not how things are. But your stake is considerable. And after all, you are Zdenek Bakala, the one who owns the mines and the flats. That is how people in the Czech Republic see things. But you see, to an extent this is the result of a certain lack of financial literacy prevalent in the country when it comes to the perception of capital markets, investor motivations and their behaviour on the capital markets. I am quite afraid people are generally unwilling to overcome their misconception. And that makes it very difficult to explain these things. Do you really think you can do away with these generally perceived associations? I don’t think it is possible to shed them and I am not trying to. But it is necessary to realise that I do not manage OKD, I do not hold a majority stake in the company and I am not its decision-maker. To what extent do the bad state of NWR and its slumping share price impact on your wealth? Not so much. It is worth reiterating that OKD makes up less than one-tenth of my assets at its current share price. In other words, it does not complicate my life to any significant degree, not at all. On the other hand, I am very much interested in seeing OKD pull through the restructuring process, if only because of the people in the region. What is it that is momentarily bringing in the money when it’s not coal? To tell you the truth, I don’t really know. Hardly anyone will believe that… Most likely it is my portfolio of liquid securities, comprising various stocks and bonds, since the exchanges have been performing relatively well in recent years. But I really don’t spend my life checking every day what is most profitable. What do you invest in these days? From my perspective as an investor, I see two markets which currently appeal to me: the United States and Sub-Saharan Africa. The United States? Yes certainly, the United States is presently greatly benefiting from cheap energy and a productive, high-quality workforce. In my opinion the country thus stands on the verge of a renaissance of manufacturing that offers highly attractive investment opportunities. We have been looking at a specific investment in the manufacturing sector in the US that I believe ticks all the boxes. In addition to that, I am keeping an eye on real estate in the US. I am a co-investor in three big residential projects in and around Houston, Texas, and that is something I would like to persevere with. And Africa? We have already written about your vineyards, but is there something new as well? Of course, Africa is a much smaller and more risky market, but the champions among the Sub-Saharan countries have been growing rapidly in recent years. I am convinced that the rates of growth in this region will exceed those of other regions of the world for the next five, 10 or even 15 years. What is it then that you are involved in Africa? What share of your investments goes to Africa? Basically, I am only involved in agriculture. Wine in South Africa and agricultural land in Mozambique and Malawi. We have overall invested in the single-digit billions of crowns there but I can’t honestly give you an exact figure for the investment share. Once again, you don’t know… And why should I? As I told you before there are competent people who manage such matters for me and I really don’t look at an Excel spreadsheet every morning with my breakfast to check the size of my assets. Of course I have access to detailed overview information on the performance of individual investments, my net worth, etc., but I just don’t constantly monitor things. Then you are a fortunate investor if you don’t have to keep a close eye on which investments are earning for you and how much. I would say that this approach is rather the norm. We at the BXR Group operate offices in London, Warsaw, Prague, Budapest, Madrid, Singapore and Brazil and the structure employs hundreds of employees tasked with seeking out opportunities and developing investment strategies. We as shareholders simply rely on the structure that we ourselves put in place doing a quality job. We are in essence a group of passive investors who rely on the quality of the people entrusted with our financial resources. So, leaving aside the cyclical downturn affecting NWR, it is safe to say that investor Zdenek Bakala is doing well, right? I can’t complain. The crisis has also affected other investments of yours, such as your Ferrexpo shares. Yet you still say that recent years have not amounted to a major problem. Of course companies that operate in strongly affected industries such as NWR have not had an easy time, especially in the last year, and they will have to tighten their belts further and work harder. But in general this downturn has been balanced out by many other factors. As I have been saying, just take a look at the American financial markets reaching record highs under Mr. Obama’s administration. You see, the age-old rule still applies: the key to investing well is diversification that enables you to ride out storms in one specific area of business. So to sum things up, Zdenek Bakala and his investments are doing well. Yes, I’m basically doing fine. What, apart from coal, takes up most of your time these days? Well perhaps it is the company in whose new headquarters we happen to be sat right now, Economia. It is going through an unprecedented transformation. Historically, I can’t recall any other case in which a similar company in Prague has simultaneously undergone a change in its leadership, a change in its physical location and an overall change in its production process. Those are three quite dramatic changes that the company must steer itself through all at once and that is a huge challenge. So that is perhaps what takes most of my time these days. But I must say it is something I am enjoying. What is the desired end product of this transformation of Economia? I have always said that Economia is a bit of a non-commercial investment for me. What that means in practice is that I do not apply the same stringent profitability criteria that I would apply to other businesses. Anyway, at the end [of the transformation] there should be a company that is stable and financially self-sustaining, something which actually already holds true since it has a shareholder willing to fully support it. It should be a company that produces the best serious high-quality content in Prague and, thirdly, a company that employs the best and best-paid journalists. That is what we are pursuing. We shall see in a year or two how things have turned out. Where is the difference here – why do you devote more time and effort to Economia than any other activity? Firstly, I am a lay person in this respect, I’m no media manager, so I strive to avoid giving my uninvited advice on things I don’t understand. However I can still take a keen interest in what is happening and I have quite in-depth information about the project as conceived. But I do not interfere with it in the sense of trying to push through my ideas of whether this or that team is to sit here or there or what their concrete job should be. But I still want the media outlets [making up the Economia group] to maintain certain quality standards. Do you, for instance, let your newspapers know what politicians they should support ahead of an election? I’m interested in politics as such. I’m much less interested in particular political parties, particular political manifestoes or specific politicians. That is all very well, but you’ve supported various parties in the past. That is why we are interested in whether it would be a problem for you to lend your support to someone through your newspapers. That matter is entirely up to Hospodářské noviny. You already know my opinion: the media as such should be able to express their own views and should be able to stand behind a specific candidate or candidates as long as they reach their conviction in a legitimate way. It should never be an opinion suggested to them, for example, by their owner. A new and interesting situation has of late developed in the Czech media sphere. After years of having mostly foreign, primarily German, owners, the leading media are being acquired by Czech owners. Apart from your case, there is also Andrej Babiš who has acquired the Mafra publishing house which includes the daily MF Dnes and iDnes.cz. Does this, in your eyes, herald good news or bad news for Czech society? First, we have to realise why it is all happening. The foreign players did not come here in the 1990s for strategic reasons, such as to supplement their portfolios or seek specific synergies. They simply came here because up until quite recently the Czech media business generated exceptional revenues compared to what they would have seen had they invested their capital in their home countries. But those times are long gone now. It naturally means that these players are now mulling over whether their investments are mature and many of them have already concluded that they are. Is it a good thing for us? I believe it is. There is no harm in Czech businesspeople owning Czech media and lending a certain character stemming from their own opinions. That can’t hurt. But isn’t there a risk of following in the footsteps of Italy or Russia where oligarchs control the media and exert an influence over outlets to promote their business? When the Czech Republic opened up to the world [after 1989] Czech businesspeople did not have a decade of work experience of, let’s say, Morgan Stanley or IBM behind them. They did not have MBAs or the experience of capital markets. As a result many of them instinctively went for what they understood. That is why so many businesses were created to attach themselves tightly to the national budget and live off it – with all the associated phenomena we all know so well by now. That is quite natural. It has often led to the conviction that media influence can be used to promote business interests. This may work for a single, specific transaction but it would be nonsensical over the long term to invest capital into a media business and then reduce revenues from this business by trying to manipulate media outlets to support some other commercial interests. That is not only wrong and unethical but also unsustainable financially over the long term. What’s more, the situation has changed dramatically as the Czech Republic now has plenty of young, well-qualified people who have studied well and gathered enough experience to transcend this traditional simple way of thinking. There is no longer any risk of the ‘Berlusconisation’ of the Czech media market and I am sure the owners will not let that happen since it would simply reduce their own earnings. We are sitting in a super-modern hall, beautifully renovated for tens of millions of crowns, while in your perception, well-educated young people are passing by in the streets outside. But how is the Czech Republic doing as a whole in your view? The Czech Republic is doing relatively poorly. Not because people here lack the talent or will to invest in this type of infrastructure, but because the country lacks a coherent political leadership. A type of leadership not based solely on permanent confrontation with adversaries but on consensus and the willingness of the political parties to work towards reaching it. That is what the country lacks today and, by the way, what has resulted in, among other things, the economy performing worse than it could, hindered by a political representation applying ideological solutions while forgetting that specific economic situations may require the use of instruments from the opposite end of the political spectrum. Basically everyone around the world has been reaching the conclusion that there has been more than enough fiscal restriction and that the time has come to press ahead with expansion instead. But for many the reduction in the rate of the growth of the public debt is the best legacy of PM Nečas’ government… I believe his government was too restrictive and that its perception of matters was far too flat. But that would be a complex debate in which I may be wrong and one which could engage us for ever. You said last year that with the level of corruption that is prevalent in this country you would no longer invest here. Has anything changed since then? As you can see the relevant authorities have been acting in a more independent fashion than in the past. They are less afraid of getting into trouble with the politicians. There has been a significant breakthrough. It is undeniable that the Nečas government really began taking steps towards eradicating corruption. Before that the Czech Republic was the most corrupt of the Central European countries. As a businessman, do you have to deal with politicians? There is absolutely no reason whatsoever to discuss business with politicians. Especially for someone who is not active in spheres that involve public orders and such like. On the other hand, the Czech Republic is pretty small and the elites here, be they in politics or business, are so close that a businessperson meeting and knowing politicians cannot be avoided while there is also no reason to avoid them just because they are politicians. For me, standard practice is to maintain correct contacts with politicians on a social level. Let us now move on from coal and politics to cycling. You have announced an ambitious plan to introduce more business into the sport and to make it more attractive for both spectators and sponsors. However, your most recent statements on this topic are from the end of last year. What is the situation today? The development can be quite simply outlined, really. First, I must say that the idea is not mine in the sense that no-one else could have had it and that along came this genius who was able to tell everyone else what to do. The concept has been around in the sport of cycling for at least a decade. Many stakeholders in cycling are aware of the need to modernise the most prestigious series of cycling races. So it is really not my idea. I am willing to lend my support, including financially. With that in mind we have entered into a memorandum of understanding between the cycling teams on the one side and UCI (Union Cycliste Internationale) on the other. There were also a few other developments in cycling at around the same time, such as the “unmasking” of Lance Armstrong and his system, which was not only a fundamentally positive development for cycling but at the same time also caused a real disturbance within the sport to such an extent that many people started focusing more on their own future and the fallout from those revelations rather than on managing the cycling sport as such. And then there is the election of the union’s new chair coming up this September. For the first time in quite a while there are several substantial candidates vying for the post and it is anyone’s guess who will win in the end, but the process has to an extent contributed to the current paralysis of the union. If your idea eventually came to fruition, what would it look like? Some say it would work a bit like the Champions League while others compare it to Formula One. In essence, it would be a series of the existing leading races, such as the Tour de France and Giro d’Italia, plus a selection of newly created races, one of which could be the Course de la Paix. The whole series would be managed by a newly established business entity in which UCI would hold a stake along with the teams and other investors. This business entity would, among other things, act as an instrument to make sure that the teams received a share of the revenues from TV rights, unlike under the current conditions. This follows the model applied in football. Yes, in football, and in Formula One, for instance. What is important is that the series runs according to a different set of rules than those that govern the sport of cycling today. The rules should be stricter, and quicker in enforcement, especially when it comes to doping. Teams would be required to nominate their best riders for individual races in order to prevent riders from being rested for half a year instead of racing and attracting spectators. It would also make it easy to see who is really the best in the world of cycling. There would be a simple and easy to understand rating of riders so ordinary spectators would have a clear idea of who is who. All of this would also produce a clearly defined product for television. Today, if you wish to follow cycling you need to down tools at work at one and watch the second half of the day’s stage until five in the afternoon. If you are content to leave it till the evening news all you see is the finish. It is simply necessary to find a television product that would have the potential to boost the number of people willing to watch cycling on TV. Isn’t it strange that this has not been done in cycling before now? It is. Cycling is probably the last major sport that still lags behind in this respect. What are the chances of the Course de la Paix being resurrected? The Course de la Paix has an immense tradition, all the famous riders remember it and fondly too. That is why I have been looking for ways of reviving it. It would be unrealistic to expect it before 2015. We have been conducting analyses, negotiating with sponsors and so forth. It is clear that we won’t be able to use the original format of the “Eastern Bloc’s Tour de France”; it would more likely be a four-stage race over an extended weekend that would not link all the three capital cities but would rather take place around the border regions of the Czech Republic, Poland and Germany with the final stage in one of those countries. How did you get into cycling? I have always liked riding a bike since my early childhood. I can still remember my first green “Favorit” bike. When I was living in the States, a bike was my means of transport. I became interested in the professional sport over time and later, after I met people involved in the sport, I realised it was the last sport yet to be reformed. So I began to see it as a business challenge. By chance I also came across a team in need of a sponsor, we made a deal and it all went from there. So it has been a gradual development. Do you still ride yourself and practice? Did you ride in the Cape Argus in Cape Town again this year? Of course! And I achieved my best time yet. Eddie Merckx gave me a lead for about 65 kilometres before he became bored with it and left me behind. But I still achieved my personal best of 4 hours and 34 minutes [over a distance of 190 km]. How often do you manage to train? Whenever I am at home in Switzerland I exercise every morning. And if the weather is good the exercise takes the form of riding my bike over a distance of 40 kilometres. But don’t imagine I clock 10,000 kilometres a year. I do not, unfortunately. What is it that has really made your day lately – except for the good news that you have another child on the way? Yes, for me it was certainly that that made me happiest, that exactly. But there are many things that give me joy. Our cycling team is one of them, for instance. The recent world championships included for the first time a time trial for professional teams and our team became the champions. Five years ago you said that you wanted to devote more time to your family and less to your business. It does not seem that you have entirely succeeded with that. So now, the same question again: how do you see your business in five years’ time? I see myself as an ageing man in five years who dedicates his time to his family, a man who has put in place corporate structures of such a calibre that he no longer needs to be personally involved in business at all. It is an extremely difficult thing to achieve and I have so far failed, but I still hope that I will manage it one day. I do not manage OKD, I do not hold a majority stake in the company and I am not its decision-maker. OKD makes up less than one-tenth of my assets at its current share price. I really don’t look at an Excel spreadsheet every morning with my breakfast to check the size of my assets. Interview originally published in Forbes, July 2013, authors: Petr Šimůnek, Jiří Nádoba.