- Adjusted EBIT margin of Fugro’s core business improved to 4.2% from 1.9% last year; driven by improved performance of the marine business, in particular in the fast growing offshore wind market.
- Modest revenue growth, on top of a very strong increase in the previous year, due to selective tendering, prioritising profitability and cash flow over revenue growth.
- Cash flow from operating activities after investing improved strongly to EUR 58.3 million.
- Strong backlog growth of 9.9%, driven by Europe-Africa and Middle East & India.
- Net result was positive excluding previously announced specific items, mainly related to Southern Star arbitration and impairment on Seabed Geosolutions (held for sale).
- Net debt/EBITDA improved to 1.9.
- Fugro announces a comprehensive refinancing of its capital structure to extend its maturity profile.
- Outlook 2020: Fugro will continue to deliver on its Path to Profitable Growth strategy, capturing market opportunities, driving margin improvement and sustained free cash flow.
|Key figures (x EUR million)
from continuing operations unless otherwise indicated
||pro-forma H2 20191
| comparable growth3
|Adjusted EBIT margin4
|Net result incl. discontinued operations6
|Backlog next 12 months
| comparable growth3
|Cash flow operating activities after investing
|Cash flow operating activities after investing incl. disc. ops.
1 Excluding impact of implementation of IFRS 16
2 Figures have been adjusted to reflect Seabed Geosolutions as held for sale (discontinued)
3 Corrected for currency effect and the divestment of the marine construction & installation activities in 2017
4 Adjusted for onerous contract provisions, restructuring cost, impairment losses, and costs related to the Southern Star arbitration
5 Covenant calculation includes Seabed Geosolutions
6 Attributable to the owners of the company
Mark Heine, CEO: “I am pleased to announce a second year of recovery with continued revenue growth and margin expansion and strongly improved free cash flow. Revenue growth of 2.7% was modest but came on top of a very strong increase last year and was impacted by our focus on profitability and cash flow.
The marine business performed significantly better, as a result of higher activity levels, better pricing and disciplined cost management, thus benefiting from operating leverage. We are involved in site characterisation projects for offshore wind farms, all over the world, which is a clear example of the role we play in the energy transition. In oil and gas, we benefit from a return to healthy levels of offshore investments, including deep water. As guided, margins in our late cyclical marine asset integrity business improved considerably, as a result of the measures taken earlier and a gradually improving market.
While our land asset integrity business showed a modest improvement, the overall land performance was disappointing. This was due to a combination of a challenging geopolitical and macroeconomic environment in certain key markets, and some underperforming services in specific countries. Although the impact of the restructuring measures that are being implemented is not yet visible in our results, I am confident that these will lead to improvements during the coming quarters and structurally higher margins going forward.
We have become a much more resilient company. By now, around 50% of our revenue is generated in offshore wind, hydrography and infrastructure. In a rapidly changing world, there are ample opportunities for us to contribute to the safe, sustainable and efficient development and operation of our clients’ assets.
Furthermore, the recently announced divestment of Global Marine is expected to bring the total proceeds from our non-core stake to around USD 73 million, of which the majority will contribute to cash flow in 2020. The proceeds will be utilised to reduce Fugro’s debt position.“