Q3 2016 Trading Update Mid Single Digit Ebit Margin And Good Cash Flow In Continued Difficult Oil Gas Market Circumstances

The publication of this Q3 2016 trading update, originally planned for 31 October, has been brought forward to support the launch of a convertible bond (reference is made to separate press release), providing the market with full disclosure on ongoing trading conditions.

Leidschendam, The Netherlands
19 Oct 2016

  • Mid-single digit EBIT margin achieved in challenging oil & gas market.
  • Year-on-year revenue decline of 22.4% or 20.4% on a currency comparable basis.
  • Good cash flow from operating activities after investments, reducing net debt by EUR 42 million in the quarter to EUR 425 million.
  • Cost reductions well ahead of schedule.
  • Fugro launches a subordinated convertible bond of approximately EUR 150 million with an increase option of up to EUR 40 million. The proceeds are expected to be used for early repayment of part of the United States Private Placement notes (USPP), resulting in reduced interest expense, additional headroom under the financial covenants and increased financial flexibility.
  • Net debt/EBITDA of 1.8 compared to covenant requirement of below 3.0. Pro forma net debt/EBITDA of 1.2 including the assumed proceeds of EUR 150 million from the convertible bond.
  • Backlog for the next 12 months decreased by 19.8% on a currency comparable basis compared to a year ago. Backlog was flat (+ 0.7%) compared to the previous quarter.
  • Outlook for 2016 reconfirmed: positive cash flow from operating activities after investments, further reduction of cost base and negative low single digit EBIT margin (excluding exceptional items) although somewhat better than previously expected.
Key figures (x EUR million) unaudited Q3 2016 Q3 2015 reported growth currency comparable growth
Revenue 474.1 610.9 (22.4%) (20.4%)
Backlog remainder of the year 365.6 500.9 (27.0%) (26.0%)
Backlog next 12 months 1,055.1 1,341.7 (21.4%) (19.8%)
Net debt/ EBITDA 1.8 2.0    

Fugro is coping with the tough oil and gas market conditions by focusing on market share, utilisation levels and continuous adjustment of cost base and capacity. As a result, we are generating good cash flow. EBIT margin in the quarter was supported by a solid performance in our renewables and building and infrastructure business. We are also making good progress with the implementation of our strategic roadmap.


We are building a truly customer centric and more efficient organisation by combining our services into integrated value propositions for our customers. To achieve this we are regrouping our geotechnical, survey and subsea activities into site characterisation and asset integrity business lines within two divisions: Marine and Land.

For more information

Media

Edward Legierse
media@fugro.com
+31 (0) 70 31 11129

Investors

Catrien van Buttingha Wichers
c.vanbuttingha@fugro.com
+31 703 115 335

 

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