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Significant expansion for Van Oord

  • Press release

Rotterdam, the Netherlands, 16 March 2015

  • Sharp turnover increase to EUR 2.104 billion (+28%)
  • Net profit of EUR 119 million (-8%)
  • EBITDA EUR 312 million (-2%)
  • Record-breaking order portfolio of EUR 3.222 billion (+66%)
  • Three main activities: Dredging, Offshore oil & gas and Offshore wind
  • Stable dredging market
  • Stable offshore oil and gas market
  • Significant growth in offshore wind division
  • Ambitious investment programme

Turnover and results

The year 2014 was exceptional in many ways. From a financial perspective, Van Oord achieved a record turnover of EUR 2.104 billion (2013: EUR 1.641 billion). It is the first time in the company’s history that its turnover has exceeded EUR 2 billion.

This year, with the award of the Gemini project (EUR 1.3 billion in turnover), Van Oord became one of the major players in the European offshore wind industry. Van Oord’s turnover was not the only thing that broke records: its order portfolio was well-filled, and was valued at EUR 3.222 billion at year-end 2014 (2013: EUR 1.944 billion). The net profit for 2014 amounted to EUR 119 million (2013: EUR 130 million; the profit for 2013 was considerably influenced by settlements reached on outstanding claims that arose in the Dubai era). 

Strategy

Van Oord’s strategy continues to focus on its three current activities: dredging, offshore oil & gas, and offshore wind. Pieter van Oord, CEO: ‘This strategy is aimed at both strengthening and investing in our position in our existing main activities. In addition to the investments in new vessels, the acquisitions of J.T. Mackley & Co. (United Kingdom), the staff and equipment from Ballast Nedam Offshore, and all of the shares in Dravo S.A. (Spain) in 2014 fit right into this strategy.’

Activities

Dredging
The dredging market remained reasonably stable last year. The occupancy rate of the trailing suction hopper dredgers was lower in 2014 than it was in 2013, but the occupancy rate of the cutter suction dredgers was substantially higher than it was in 2013. Pieter van Oord: ‘Despite less-than-ideal market conditions, we managed to secure quite a large number of orders in 2014. Our order portfolio is well-filled for 2015, and vessel occupancy rate is at satisfactory levels. Some of the more prestigious projects are the KNPC land-reclamation project in Kuwait, the dredging of a canal that will run parallel to the Suez Canal, and the construction of a large new island near Jakarta, Indonesia, which will give that rapidly growing city room to expand. Most of the work on these three projects will actually be carried out in 2015.’

Offshore oil & gas
The drop in the oil price in 2014 will mean a decrease in the investment levels of oil and gas companies all over the world and a corresponding delay in tenders for new projects. Van Oord was able to maintain its position in the oil and gas industry in 2014. ‘We expect the effects of the oil price drop to have the most impact during and after 2015. Despite the uncertainties we face, we remain cautiously optimistic. Our policy will continue to be aimed at increasing our market share in this sector. In that context, our efforts will include deploying our pipe-laying vessel Stingray on EPC contracts. The decision to invest in a new subsea rock installation vessel like the Bravenes is also an indicator of our confidence in this sector over the long term’, says Pieter van Oord.

Offshore wind
The Offshore Wind Projects Division grew exponentially in 2014, in terms of both turnover and organisation. This growth was based on the award of two major contracts to Van Oord (Eneco Luchterduinen and Gemini). The projects and activities on this market are fundamentally different than those in either the dredging or offshore oil and gas sector. Van Oord anticipated this within the company by adjusting its organisation and attracting and training employees with other competences and capabilities. This market is also distinguished by the relatively large number of subcontractors and materials purchased. The development of the offshore wind market is still in full swing, with one continuing and relatively uncertain factor being the political decision-making on the construction of large offshore wind parks and the necessary government support for these types of projects. Particularly important are the political efforts at European level to continue investing in the generation of sustainable energy. The Dutch Energy Agreement provides a stimulus for continuing to develop offshore wind projects.

People, safety, and sustainability

Van Oord’s staff grew in 2014 from 4,195 to 4,843 employees. Pieter van Oord: ‘Van Oord will continue to raise its profile on the labour market and recruit new people. During the National Career Fair in 2014, Van Oord was named “favourite employer in the marine contracting sector” and we received an award for our trainee programme.’

There were also fewer accidents in 2014. Although Van Oord’s long tradition of reducing the number of accidents resulting in absence continued last year, the company is still devoting undiminished attention to a safe work environment, because even one accident is one too many. In 2014, as part of the Safety Leadership Programme, more than 300 managers received extra training, and safety awareness has increased enormously in comparison to three years ago. Leadership plays a prominent role in safety.

When it executes its projects, Van Oord also has to deal with their effects on the environment. Because sustainability is important to Van Oord, it has become an essential part of both the company’s strategy and its activities. In 2014, for example, various Guards developed by Van Oord (ReefGuard, FaunaGuard, and PlumeGuard) and eco-engineering solutions were included in tender proposals and were actively applied during projects such as Eneco Luchterduinen (the Netherlands), Liverpool 2 (United Kingdom), Sandy Bottom (Bahamas), and KNPC (Kuwait). In 2014, the company focused on the energy efficiency of the fleet: two-thirds of Van Oord’s self-propelled vessels have been awarded International Energy Efficiency Certificates and the order for two new trailing suction hopper dredgers specifies fuel efficiency as a top priority. The company’s CO2 footprint in 2014 was reduced by 10% compared to 2010.

Investment programme

According to Van Oord’s 2013-2018 Strategic Plan, the company will be investing more than EUR 1 billion in building new vessels and modernising and replacing the fleet. In 2014, this investment included an order for a new fallpipe vessel, Bravenes, which is currently being built by the Sinopacific Shipbuilding Group Shanghai at its shipyard in Ningbo, China. Two trailing suction hopper dredgers are also being developed and have been ordered; these vessels are now under construction at the LaNaval shipyard in Spain. The offshore wind division was also strengthened by the acquisition of the staff and equipment from Ballast Nedam Offshore. Investments made earlier also paid off in 2014, with events such as the successful introduction of the Aeolus, a vessel designed for offshore and wind projects, and the construction of the Nexus, the cable-laying vessel that was launched on 7 March 2015. The Aeolus was delivered in July 2014 and was first deployed to the Eneco Luchterduinen offshore wind park project. The introduction of the Aeolus to the fleet was incredibly successful. After Eneco Luchterduinen is completed, the Aeolus will be deployed to the Gemini project. The Nexus will also be deployed to this project after being launched in spring 2015.

Financing and shareholdings

The company is financially sound. There were no changes either in its financing or its shareholding ratios in 2014. Van Oord N.V. is a public limited company with its head office in the Netherlands. MerweOord BV, the holding company owned by the Van Oord family, holds 78.5% of its shares. The remaining shares are held by Cobepa (Nederland) N.V. (10.75%) and ConsOord B.V. (10.75%).

Outlook

Pieter van Oord: ‘On balance, the sharp drop in the price of oil has not been good for our company. A much lower oil price means that large oil and gas companies will postpone starting projects and making investments. We’ll be feeling most of the effects of this during and after 2015. Conversely, the drop in the value of the euro against other major currencies, including the dollar, will help us in 2015 by reducing our operating costs in countries that use the dollar. We remain optimistic about our opportunities for growth in offshore wind projects. The fact that our order portfolio for 2015 is so well-filled gives us confidence about this year. Our turnover and activities will continue to expand.’

Press contact

Contact Media Relations

Robert de Bruin

31 88 8268234
31 6 53440890
robert.debruin@vanoord.com

Robert de Bruin deals with all media enquiries relating to Van Oord's corporate and international activities. For non press related questions we kindly redirect you to our contact form.

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