Papendrecht, 17 August 2017
HIGHLIGHTS FIRST HALF YEAR 2017
-
Revenue: EUR 1.09 billion
-
EBITDA: EUR 225.1 million
-
Net profit: EUR 75.1 million
-
Order book: EUR 3.25 billion
OUTLOOK for 2017
-
Mixed market picture
-
Dredging & Inland Infra: reasonable market
volumes with further upward potential for utilization rates
-
Offshore Energy: fewer contracting projects and
continued friction between supply and demand in services
-
Towage: relatively stable market volumes
-
Profit outlook: net profit in the second half of
the year comparable to the first half of the year, excluding
restructuring charges
Royal Boskalis Westminster N.V. (Boskalis)
realized a net profit of EUR 75.1 million in the first
half of 2017 (H1 2016: EUR 147.5 million).
Revenue in the first half of the year declined by
7% compared to the first half of last year to EUR 1.09 billion
(H1 2016: EUR 1.17 billion). Adjusted for consolidation,
deconsolidation and currency effects, revenue was down by 13%.
EBITDA in the first half of the year totaled EUR
225.1 million and the operating result was EUR 101.7 million
(H1 2016 EBITDA: EUR 317.6 million, operating result: EUR
182.4 million).
Both revenue and fleet utilization increased at
the Dredging & Inland Infra segment, with large projects in
execution in Brazil, Indonesia and Oman contributing to the rise.
The result was virtually stable with continued margin pressure.
At Offshore Energy revenue and result declined,
due in part to poor market conditions in the oil and gas industry.
In addition there are no major offshore wind farm projects in
progress this year, whereas the construction of two sizable wind
farms contributed to revenue and the result last year. The VBMS
cable-laying activities had a good first half of the year, making a
significant contribution to the division's results.
Revenue and results were also under pressure at
Towage & Salvage, partly due to the deconsolidation of the
European harbor towage services but also as a result of a very
quiet first half of the year at Salvage. It was quiet globally,
with a limited number of emergency response assignments.
Furthermore there were no major wreck removal projects being
executed.
Boskalis' financial position continues to be
strong, with a solvency ratio of 62.6% and a positive net cash
position of EUR 235 million.
The order book, excluding our share in the order
book of joint ventures and associated companies, increased to EUR
3.246 billion at the end of the first half of the year (end-2016:
EUR 2.924 billion).
Peter Berdowski, CEO of Boskalis:
"Developments in the first half of the year were
in line with expectations. The results of the traditional dredging
activities were stable with higher fleet utilization rates. The
outlook is moderately positive given the volume of work in the
market and an increase in the order book. As expected, the
situation in the offshore market resulted in a further drop in the
result. We do not foresee a quick recovery in the offshore market,
as previously stated, and have adjusted our fleet and organization
to this new reality.
The weak offshore market also
presents clear opportunities for us to strengthen the company, as
evidenced by the recently announced acquisition of Gardline. This
acquisition will specifically help fulfill our strategic ambition
to build a position in offshore survey. Gardline is a key player in
the survey market with years of experience and a strong reputation.
The acquisition will enable us to further position ourselves for
opportunities in offshore wind energy, as well as to be well placed
to take advantage of growth opportunities when the offshore market
picks up again. In the coming period we will continue to look
actively at opportunities to strengthen and expand the company in
the medium term."
Market developments
The market developments as presented in the
Corporate Business Plan 2017-2019 and discussed in greater detail
in the Annual Report 2016 have not materially changed.
The long-term megatrends that underpin the
Boskalis business model remain positive. These business drivers are
the structural growth and rising prosperity of the global
population, which in turn drive growth in global trade and demand
for raw materials and energy. Global warming also continues to
create business opportunities for Boskalis, with a growing need for
coastal defense and riverbank protection in response to increased
flooding as a result of the more extreme weather conditions. While
the long-term trends are positive, in the short term they are not
converting into promising projects across the board. In some of the
regions and markets where Boskalis is active demand is expected to
develop less favorably in the coming years and the outlook is
uncertain. Boskalis will continue to focus on market segments that
demonstrate long-term structural growth as well as offering
opportunities in the short term: Ports, Energy (oil, gas, wind and
the dismantling of old offshore platforms) and Climate
change-related projects (coastal defense and riverbank
protection).
We see plenty of opportunities to expand the
company further; opportunities at Dredging & Inland Infra and
at Towage, but particularly in the high-end section of the Offshore
Energy market where current market conditions also present clear
opportunities.
Outlook
The coming period will continue to present a mixed
market picture. At Dredging & Inland Infra we see a reasonable
volume of work in the market in the short term. For Boskalis the
emphasis lies on maintaining utilization at a responsible level of
project risk. The current size of the order book means that a good
part of the fleet will be occupied for the coming nine months,
albeit at lower margins than in previous years. The outlook for the
remainder of 2017 is less favorable for Offshore Energy, with lower
work volumes and pressure on utilization rates and margins.
Following the conclusion of a number of long-term contracts from
previous years revenue is under pressure with increasing dependence
on the spot market, resulting in further pressure on margins. The
offshore wind outlook for the second half of the year is mixed,
with a sustained favorable outlook for the cable-laying activities
but no large offshore wind farm projects in progress. The Towage
activities have relatively stable market volumes and this is not
expected to change materially in the second half of the year.
In the past 18 months the market conditions
combined with the outlook described gave rise to the fleet
rationalization project, an impairment of vessels and goodwill, and
a cost-reduction program aimed at reducing head-office costs. The
implementation of this cost-reduction program started recently and
is well on track. The associated costs of around EUR 15 million
will be recognized in the second half of 2017. Annual cost savings
of this program of around EUR 30-35 million will be fully realized
by the end of 2018.
Based on the fleet planning and work in the order
book and barring unforeseen circumstances, the Board of Management
expects net profit in the second half of 2017, excluding the stated
restructuring charge, to be comparable to the level of net profit
realized in the first half of the year.
Capital expenditure in 2017 is expected to be
around EUR 250 million, excluding acquisitions, and will be
financed from the company's own cash flow. Boskalis has a very
sound financial position and the solvency ratio improved further to
62.6%. At the end of the period Boskalis had a net cash position of
EUR 235 million and comfortably met its financial covenants.
KEY FIGURES |
1st HY
2017 |
1st HY
2016 |
2016 |
(in EUR million) |
|
|
|
Revenue |
1,092.6 |
1,171.3 |
2,596.3 |
EBITDA |
225.1 |
317.6 |
660.5 |
Net
result from JVs and associates |
21.9 |
-7.6 |
11.3 |
Operating
result |
101.7 |
182.4 |
384.6 |
Impairment charges |
- |
- |
842.6 |
EBIT |
101.7 |
182.4 |
-458.1 |
Net
profit adjusted for impairments |
75.1 |
147.5 |
276.4 |
Net
profit (loss) |
75.1 |
147.5 |
-563.7 |
Earnings
per share (in EUR) |
0.58 |
1.17 |
2.16 |
|
|
|
|
|
30 June 2017 |
30 June 2016 |
End 2016 |
Order
book |
3,245.7 |
2,696.9 |
2,923.9 |
Our share in the net result of
the joint ventures and associated companies is included in
EBIT(DA).
2016 full-year EBITDA, operating result, net
result from associates and earnings per share are presented
excluding impairment charges.
Live audio webcast
The Board of Management of Royal Boskalis
Westminster will comment on the 2017 half-year results at the
analyst meeting (11.30 am - 12.45 pm CET) on 17 August 2017. This
meeting can be followed by means of a live audio webcast, details
of which can be found on the homepage (www.boskalis.com).
>>>
Click here for the full version of the half year report including
all the financial details <<<
2017-2018 |
FINANCIAL CALENDAR |
17
August |
Publication of 2017 half-year results |
10
November |
Q3 2017
trading update |
8
March |
Publication of 2017 annual results |
9
May |
Q1 2018
trading update |
9
May |
Annual
General Meeting of Shareholders |
16
August |
Publication of 2018 half-year results |
9
November |
Q3 2018
trading update |
For further information
Investor relations:
Martijn L.D. Schuttevâer
ir@boskalis.com
Press:
Arno Schikker
press@boskalis.com
T +31 78 6969310
This is a
Boskalis press release on the grounds of article 17 paragraph 1 of
the European Market Abuse Regulation (596/2014).
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 as well as
salvage solutions (SMIT Salvage). Furthermore, Boskalis has a
number of strategic partnerships in harbor towage and terminal
services (Kotug Smit Towage, Keppel Smit Towage, Saam Smit Towage
and Smit Lamnalco). With a versatile fleet of more than 900 vessels
and floating equipment and 11,700 employees, including associated
companies, Boskalis operates in 90 countries across six
continents.
This press release can also be found on our
website www.boskalis.com.
PDF version of this press
release
Half year report 2017
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq 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
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