Van Oord posts results for 2018
In 2018, Van Oord recorded EUR 1.88 billion in revenue (2017: EUR 1.53 billion) with a net profit of EUR 92 million (2017: EUR 78 million), the company said in its release. The increase in revenue was mainly driven by offshore wind activities, which realised EUR 706 million of revenue (2017: EUR 403 million). Revenue in the Netherlands also increased to EUR 115 million (2017: EUR 82 million). In Dredging the revenue from international activities (EUR 852 million) was similar to 2017 (EUR 841 million) reflecting ongoing difficult market circumstances. The same applied to Offshore with a revenue level of EUR 203 million (2017: EUR 204 million).
Van Oord realised a net profit of EUR 92 million (2017: EUR 78 million). This included one-off items. The sale of the share in Gemini Offshore Wind Farm generated a net book profit of EUR 38 million. Van Oord also accounted for a net cost of EUR 20 million in light of refinancing its US Private Placement (EUR 27 million before tax). The EBITDA in 2018 was EUR 306 million (2017: EUR 290 million).
Van Oord order book amounted to EUR 3.68 billion at year-end 2018, compared to EUR 3.39 billion at year-end 2017. The five largest awarded projects were the reinforcement of the Afsluitdijk, the Fryslân nearshore wind farm, the construction of the A16 motorway, the modernisation of the Świnoujście to Szczecin fairway in Poland and the contract for supplying and installing cables at the Hollandse Kust (South) wind farm.
Van Oord saw a recovery in revenue and profit level in 2018, after two years of contraction. The increase in revenue was attributable primarily to its offshore wind activities.
Van Oord financial position remains strong with an equity of EUR 999 million (2017: EUR 943 million) and a solvency ratio of 39.5% (2017: 37.3%). The net debt position amounted to EUR 78 million compared to EUR 43 million at year-end 2017. This debt level is well within Van Oord credit facility terms and conditions.
Amongst others, Van Oord started executing the Dubai Harbour project. This prestigious property development project will include a hotel, a cruise liner terminal, a shopping mall and residences. The contract involves dredging the 12-kilometre navigation channel, reclaiming land, extensive rock work and quay wall construction and executing vibro compaction. After the iconic Palm Jumeirah, Van Oord will be contributing to yet another Dubai landmark.
The Netherlands business unit realised a significant increase in its order book, thanks to two major DBFM (Design, Build, Finance, Maintain) projects: the Afsluitdijk and the A16 motorway project. The infrastructure market in the Netherlands is characterised by strong competition and low margins. In the coming years, revenue in the Netherlands will grow as the result of these projects.
The Offshore Wind business unit had record revenue in 2018. Four major projects commenced simultaneously: Deutsche Bucht in Germany, the Norther project in Belgium, East Anglia ONE in the UK and the Dutch Borssele III & IV project. These offshore wind farms combined represent an important step forward in the energy transition. Together they will supply some 1.6 million homes with sustainable energy.
In September 2018, MPI Offshore was acquired including two offshore installation vessels. Through this acquisition, Van Oord UK market position has been strengthened and its equipment position in offshore wind has also been reinforced. Van Oord added Operations & Maintenance activities to its service package as part of this deal.
Since 2014, the OFS market (Oil Field Services) has been in a recession. However, it appeared to have bottomed out in 2018. The Offshore business unit’s profits are returning to a satisfactory level. In the end of 2018, all three flexible fallpipe vessels were active, including the brand-new Bravenes that became operational in May 2018.
After working for five years on the tender for the Golfinho project in Mozambique, Van Oord and consortium partner TechnipFMC were selected as preferred tenderer by oil & gas company Anadarko. Being selected for the EPCI contract (engineering, procurement, construction and installation) of the offshore subsea system for its Mozambique LNG project is a great milestone for Van Oord.