Q3 2016 trading update: mid-single digit EBIT margin and good cash flow in continued difficult oil and gas market circumstances

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.