Papendrecht, 18 August 2016
HIGHLIGHTS FIRST HALF YEAR 2016
-
Revenue: EUR 1.17 billion
-
EBITDA: EUR 318 million
-
Net profit: EUR 148 million
-
Order book: EUR 2.70 billion
OUTLOOK
-
Dredging: continued challenging market
conditions with upside potential for the utilization rate
-
Offshore Energy: difficult conditions,
particularly in the service-related activities
-
Towage: relatively stable market volumes
-
Profit outlook: operating net profit in the
second half of 2016 to approach the level achieved in the first
half of the year
Royal Boskalis Westminster N.V. (Boskalis)
realized a net profit of EUR 147.5 million in the first
half of 2016 (H1 2015: EUR 306.5 million).
Revenue in the first half of the year fell 25%
compared to the first half of last year to EUR 1.17 billion
(H1 2015: EUR 1.57 billion). Whereas the first half of 2015 was
extremely busy, revenue declined in the first half of this year as
a result of the deteriorated market conditions.
EBITDA in the first half of the year totaled EUR
317.6 million and the operating result (EBIT) was EUR 182.4
million (H1 2015 EBITDA: EUR 500.1 million, EBIT: EUR
359.3 million).
In the Dredging & Inland Infra segment revenue
and the result declined as a result of weak market conditions and
the completion of the Suez Canal project that made a substantial
contribution last year. Furthermore, fleet utilization was
adversely affected by the suspension of work on the Pluit project
in Indonesia. Results on projects in progress were reasonable to
good.
Offshore Energy managed to have a good first half
of the year despite market conditions and the resulting lower
revenue and fleet utilization. The EBIT and EBITDA margins were
virtually stable compared to the same period last year.
At the start of April Boskalis' 50/50 joint
venture with KOTUG aimed at combining the European harbour towage
activities together was effected. This joint venture has been
reported under joint ventures and associated companies as of the
second quarter. Due in part to this, revenue in the Towage &
Salvage segment declined in the first half of the year compared to
2015. Salvage had a busy start to the year with various emergency
response assignments, but the result declined on balance due to the
absence of larger wreck removal projects.
In accordance with IFRS the inclusion of SMIT
Towage Northwest Europe in the joint venture with KOTUG must be
recognized as a sales transaction and a subsequent acquisition of a
minority stake. This 'sale' resulted in a book profit of EUR 37.0
million after taxation in the first half of the year. Our stake in
the (adjusted) loss incurred by Fugro in the first half of the year
was EUR 27.9 million.
At the end of the first half of the year the order
book excluding our share in the order book of joint ventures and
associated companies stood at EUR 2,697 million (end-2015: EUR
2,490 million). The offshore activities acquired from VolkerWessels
on 1 July will be included in the order book as of the third
quarter.
Peter Berdowski, CEO
Boskalis:
"At the start of the year we indicated that we are
experiencing stormy conditions. Falling prices of oil, gas and
commodities are the dark clouds on the horizon that ultimately also
affect late-cyclical companies such as Boskalis. The volume of work
in the market has dropped significantly and a decline in revenue
and the result is therefore inevitable.
We foresee that the current
market environment may persist for several years. We have therefore
taken the necessary steps to adjust the size and composition of the
fleet to this new reality. As previously announced we will take 24
vessels out of service in the 2016-2018 period and consequently
have to let go of a large number of employees. These are drastic
measures that unfortunately need to be taken to ensure that
Boskalis remains healthy going forward."
Market developments
The trends on which the Boskalis business model is based continue
to apply. These relate to both global population growth and
increasing prosperity. In a number of regions and markets where
Boskalis is active these trends are developing less favorably in
the short and medium term, making the outlook uncertain. Boskalis
remains focused on market segments that show structural growth in
the longer term while also providing short-term opportunities:
Energy (oil, gas and wind), Ports and Climate change-related
projects (coastal defense and riverbank protection).
There is a reluctance to invest in major new ports
and offshore-related projects. Despite slower growth in sea
freight, demand for larger and deeper ports with the associated
infrastructure to accommodate larger oceangoing and other vessels
with deeper drafts provides opportunities. In addition, demand for
energy and the associated increase in offshore exploration and
production, often in vulnerable regions, which in turn increases
the need for sustainable solutions is also favorable for Boskalis.
The greater focus on climate-related issues and ensuing
opportunities in the field of offshore wind farm projects has
created a sizable growth market with interesting projects. And one
of the positive short-term consequences of the low price of oil is
that old offshore oil and gas platforms are now permanently being
taken out of operation and are being decommissioned.
Global population growth ensures structural demand
for our land reclamation and infra activities. Climate change is
forcing governments on several continents to take steps to protect
their populations against flooding and rising sea levels. The
result of this is a structural demand for integrated sustainable
solutions.
Outlook
The general market outlook for the coming period is expected to
continue to be characterized by lower volumes of work and pressure
on utilization rates and margins. At Dredging & Inland Infra
the emphasis is on safeguarding utilization rates at responsible
levels of project risk. At Offshore Energy a number of long-term
contracts and work already contracted provide stability for part of
the fleet, but the spot market-related transport activities and
subsea services are experiencing pressure on utilization rates and
margins. The offshore wind market presents new opportunities,
partly through the recently acquired offshore activities of
VolkerWessels. At Towage all activities have now been transferred
to joint ventures. Market volumes in this segment are relatively
stable, although competition is expected to increase further here,
too, particularly in oil and gas-related services.
The fleet rationalization program will be
implemented in the next two years. This will involve vessels being
taken out of service and the loss of 650 jobs. It will also involve
taking a critical look at reducing costs of the global office
network.
Based on the fleet planning and work in the order
book, and subject to unforeseen circumstances, the Board of
Management expects the level of operating net profit in the second
half of 2016 to approach the level achieved in the first half of
the year.
Capital expenditure is expected to be
approximately EUR 200 million in 2016, excluding acquisitions, and
will be financed from the company's own cash flow. Boskalis has a
very sound financial position and the solvency ratio has increased
further to over 60%.
>>>
Click here for the full version of the half
year report including all the financial details
<<<
KEY FIGURES |
1st HY
2016 |
1st HY
2015 |
2015 |
(in EUR million) |
|
|
|
Revenue |
1,171.3 |
1,570.3 |
3,240.3 |
EBITDA* |
317.6 |
500.1 |
884.7 |
Net
result from joint ventures and associates |
-7.6 |
30.0 |
43.3 |
Operating
result (EBIT)* |
182.4 |
359.3 |
562.8 |
Net
profit |
147.5 |
306.5 |
440.2 |
Earnings
per share (in EUR) |
1.17 |
2.50 |
3.54 |
|
|
|
|
|
30 June 2016 |
30 June 2015 |
End 2015 |
Order
book |
2,696.9 |
2,962.9 |
2,490.0 |
* Our share in the net result of
the joint ventures and associated companies is included in
EBIT(DA).
Live audio webcast
The Board of Management of Royal Boskalis
Westminster will comment on the 2016 half-year results at the
analyst meeting (11.30 am - 12.45 pm CET) on 18 August 2016. This
meeting can be followed by means of a live audio webcast, details
of which can be found on the homepage (www.boskalis.com).
2016-2017 |
FINANCIAL CALENDAR |
18 August
2016 |
Publication of 2016 half-year results |
11
November 2016 |
Trading
update on third quarter of 2016 |
8
March |
Publication of 2016 annual results |
10
May |
Trading
update on first quarter of 2017 |
10
May |
Annual
General Meeting of Shareholders |
17
August |
Publication of 2017 half-year results |
10
November |
Trading
update on third quarter of 2017 |
>>>
Click here for the full version of the half
year report including all the financial details
<<<
For further information
Investor relations:
Martijn L.D. Schuttevâer
ir@boskalis.com
Press:
Arno Schikker
press@boskalis.com
T +31 78 6969310
This is an
English translation of the Dutch press release. In the event of any
disparity between the Dutch original and this translation, the
Dutch text will prevail.
Royal Boskalis
Westminster N.V. is a leading global services provider operating in
the dredging, maritime infrastructure and maritime services
sectors. The company provides creative and innovative all-round
solutions to infrastructural challenges in the maritime, coastal
and delta regions of the world with services including the
construction and maintenance of ports and waterways, land
reclamation, coastal defense and riverbank protection. In addition,
Boskalis offers a wide variety of marine services and contracting
for the oil and gas sector and offshore wind industry and salvage
(SMIT Salvage). Furthermore, Boskalis has a number of strategic
partnerships in harbour towage and terminal services (KOTUG SMIT
Towage, Keppel Smit Towage, Saam Smit Towage and Smit Lamnalco).
With a versatile fleet of 1,000 units Boskalis operates in around
75 countries across six continents. Boskalis has over 8,200
employees, excluding its share in partnerships.
This press release can also be found on our
website www.boskalis.com.
Half year report
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Koninklijke Boskalis Westminster N.V. via
Globenewswire
HUG#2035760
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