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Fugro HY 2015: Improved results under challenging market

Increased margin pressure expected in second half year

06 Aug 2015  
Leidschendam, The Netherlands

  • Year-on-year revenue growth of 4.3%; decline of 7.3% on a currency comparable basis
  • EBIT margin (excluding exceptional items) increased to 5.7% from 2.1% in the same period last year, mainly driven by the strong improvement at Seabed Geosolutions and somewhat higher margin at Survey and offshore Geotechnical
  • Divestment of the non-core multi-client data library completed with net proceeds of EUR 101.9 million
  • Cash flow from operating activities after investments of EUR 121.8 million, driven by the proceeds from the sale of the multi-client data library, improved working capital and lower investment levels
  • Balance sheet strengthened; net debt to EBITDA improved to 2.0 compared to covenant requirement of below 3.0.
  • In line with market developments, backlog for the next 12 months is down by 23.9% on a currency comparable basis compared to a year ago and by 4.4% compared to the end of the first quarter of this year.
  • Fugro expects to realise a lower EBIT in the second half of 2015, compared to the second half of 2014 (excluding exceptional items), mainly related to Subsea Services, which is confronted with a significant decline in backlog in combination with high operational leverage
Key figures (x EUR million) HY 2015 HY 2014
Revenue 1,237.7 1,186.9
 currency comparable growth (7.3%) 6.2%
EBITDA1 excluding exceptional items2 197.7 147.1
EBIT excluding exceptional items2 70.4 24.9
EBIT margin excluding exceptional items (%)2 5.7% 2.1%
Net result (9.9) (270.6)
Backlog next 12 months 1,506.8 1,775.0
  currency comparable growth (23.9%) 9.9%
Cash flow from operating activities after investments 121.8 (88.7)
Net debt/EBITDA3 2.0 2.3
The information in this report is unaudited

1 EBITDA is EBIT before depreciation, amortisation (including amortisation on multi-client library) and impairments related to goodwill, other intangible assets, property, plant and equipment
2 Impairments, onerous contract charges, restructuring costs and write-off receivables of EUR 26.0 million in HY2015 compared to EUR 346.6 million in HY2014
3 Refer to Annual report 2014 for definition EBITDA for covenant purposes and page 22 of the half-year report

We have made good progress with the implementation of our 2015 management agenda: focus on profitability, cash flow and strengthening of the balance sheet. We are pleased with the completion of the divestment of the multi-client library. The other planned portfolio changes are ongoing and are taking more time under the current market circumstances. The further deterioration of the oil and gas market has resulted in reductions of our customers’ project budgets, causing revenue decline and margin pressure for oil services companies such as Fugro. We do not expect the market to recover in the foreseeable future. We are managing through this downturn by proactively reducing costs and implementing performance improvement measures. This has resulted in an improved margin, in particular in Seabed Geosolutions and also in Survey and offshore Geotechnical.

We have won several important new contracts. This includes the site investigation work on one of Europe’s largest infrastructure projects: the Fehmarnbelt Link tunnel between Denmark and Germany, where the client requires independent advice for the design and execution of this important construction project.

We continue to align the organisation to market circumstances. This is supporting us in getting through the downturn and in positioning the company well to benefit from recovery in the oil and gas market when the supply demand balance is restored.”

For more information


Edward Legierse

+31 (0) 70 31 11129


Catrien van Buttingha Wichers

+31 (0) 70 31 15335


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