Fugro FY 2017: Results in line with expectations

Oil and gas market stabilising after challenging 2017; growth in other markets

Leidschendam, The Netherlands
22 Feb 2018

Highlights full year

  • Year-on-year revenue decline of 15.7% or 13.2% on a currency comparable basis with low-single digit decline in the fourth quarter. Revenue from non-oil and gas markets increased by 9.4%.  
  • EBIT margin (excluding exceptional items) decreased to -2.1% mainly due to low utilisation APAC, incidental operational issues and price pressure in the Marine division, and lower activity levels at Seabed Geosolutions. The margin of the Land division improved. EBIT margin for the group was higher in the second half than in the first half year.
  • Net cash from operations was EUR 24.4 million and net investments were EUR 74.9 million, resulting in cash flow of -EUR 50.5 million. In the second half year, cash flow was EUR 15.6 million positive.
  • Net debt/EBITDA of 1.9, well below covenant requirement of maximum 3.0. 
  • Backlog for the next 12 months is down 7.3% on a currency and portfolio comparable basis compared to a year ago, and up by 9.1% compared to the third quarter of 2017. 
  • Outlook 2018: As the oil and gas market is stabilising and other markets are growing, Fugro expects stabilising revenue, an improved EBIT margin and a positive cash flow from operating activities after investments.
Key figures (x EUR million) Full year 2017 Full year 2016
Revenue 1,497.4 1,775.9
   currency comparable growth1 (13.2%) (22.7%)
EBITDA (excluding exceptional items2) 100.8 189.5
EBIT (excluding exceptional items2) (32.1) 8.5
EBIT margin (excluding exceptional items2) (2.1%) 0.5%
Net result (159.9) (308.9)
Backlog next 12 months 927.8 1,169.6
   currency comparable growth1 (7.3%) (11.6%)
Cash flow from operating activities after investments (50.5) 186.1
Net debt/EBITDA 1.9 1.1

1 Revenue growth corrected for currency effect; 2017 backlog growth corrected for currency effect and for portfolio changes related to the marine construction & installation activities
2 Onerous contract provisions, restructuring cost, impairment losses, and other exceptional items totalling EUR 19.6 million compared to EUR 227.2 million in 2016

Paul van Riel, CEO: “The year 2017 was the fourth of an exceptionally deep downturn in offshore oil and gas services, our largest market, and we continued to adjust our capacity and costs to market reality. With an organic 9% revenue increase we were successful in growing in our other markets.

We made good progress with our strategic agenda. We successfully regrouped our survey, geotechnical and subsea activities in two divisions, Land and Marine, and built a more client centric organisation. We have improved our capabilities to deliver integrated service solutions to clients and are now able to better leverage internal synergies. In the fourth quarter we achieved our objective of divesting the non-core marine construction and installation activities.

The number of final investment decisions in our offshore oil and gas market is increasing, which is an early indicator of rising activity levels. Our other markets are expected to grow further as the world economy is strong and our solutions are required to support the energy transition and sustainable urbanisation. Based on these developments we expect our results to improve after a particularly challenging 2017.” 

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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