The impact of the Covid-19 pandemic is amplified by spending cuts of oil and gas companies due to the sharp decline in the oil price earlier this year; the resulting volatility is expected to continue into 2021. At the same time, offshore wind, in which Fugro has a strong position and reputation, is anticipated to show continued strong growth.
The pandemic may in the short term result in a decline in infrastructure activities; on the other hand, as a result of numerous investment programs, growth in the infrastructure markets is expected to resume as of 2021, after a stagnation in 2020.
For the full-year 2020, from continued operations, Fugro expects revenue of at least EUR 1.35 billion, representing a year-on-year currency comparable decline of around 10%. The impact of the revenue decline is expected to be mitigated by the ongoing comprehensive cost reduction programme, resulting in an adjusted EBITDA of around EUR 150 million and an adjusted EBIT of around EUR 40 million, which is an improvement compared to previous guidance, and a return on capital employed of around 4%. In addition, Fugro reconfirms its expectation of a positive free cash flow, taking into account capital expenditure of around EUR 70 million. This outlook assumes no material impact from additional Covid-19 developments.