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Annual accounts Van Oord 2009

  • Press release
  • Financially healthy company
  • Excellent profitability
  • EUR 1,424 million turnover and EUR 120 million net profits
  • Order portfolio up to standard

Turnover and profits

Van Oord’s turnover was EUR 1,424 million in 2009 (2008: EUR 1,896 million). Net profits were EUR 120 million (2008: EUR 165 million). Profitability – expressed as a percentage of turnover – remained high at 8.4% (2008: 8.7%). We achieved healthy results in virtually every region of the world, with a good balance between people and equipment on the one hand and available work on the other. In addition, almost none of our projects in the past year were loss-making. Loss of turnover in the Middle East was compensated in part by a rise in turnover in other parts of the world. In early 2009, we adjusted our organisation to the reduced turnover in Dubai. We did this not only in Dubai itself, where hundreds of jobs were cut, but also, to a limited extent, at our headquarters in Rotterdam. Because our activities are distributed worldwide, we were able to deploy our international employees and equipment elsewhere. That means that turnover has increased in our Netherlands, Brazil, Nigeria and India regions in particular. The same goes for Offshore and the Offshore Wind Projects business unit.

Order portfolio

The large-scale land reclamation projects in Dubai that were postponed in late 2008 (valued at EUR 1,842 million) were deducted from our work in progress. At 31 December 2009, our order portfolio stood at EUR 1,777 million and is therefore up to standard (2008: EUR 1,798 million).

Our regions and projects

Netherlands (EUR 250 million turnover)
In our organisation, this region encompasses both the Netherlands and Belgium. The most important projects in Van Oord’s domestic market involved coastal protection, river management, port expansion and infrastructure expansion. In 2009, the recommendations of the Delta Commission were laid down in the National Water Plan. The new plan provides the basis for all flood safety and marine engineering projects that will be carried out in future. 

The year 2009 was an extremely busy one in the Netherlands region. The construction of Maasvlakte 2, a new area of the Port of Rotterdam, will further boost the port’s continued development. Van Oord has a 50% stake in PUMA, the consortium carrying out the project. The work is progressing according to schedule. At the same time, Van Oord deployed a large number of trailing suction hopper dredgers on various coastal defence projects that formed part of the Netherlands‘ ‘Weak Links’ coastal defence programme, including the Hondsbossche and Pettemer Seawalls, the coast at Scheveningen, Delfland, Nolle West Dunes and between Nieuwvliet and Groede. Sand suppletion operations were carried out at Voorne and Texel as part of a regular maintenance programme. Van Oord also helped reinforce the foreshores of a number of dikes along the Oosterscheldt and Westerscheldt in the Zeeland delta. Among other dry infrastructure projects, we are part of a consortium contracted to widen the A4 motorway.

Europe (EUR 110 million turnover)
The Europe region encompasses the United Kingdom, Germany and Russia (where we have permanent branch offices) and the former Soviet republics. The worldwide economic crisis has been noticeable in this region. The former Soviet republics have been hit particularly hard, and various projects have been downsized or postponed. Our projects in Germany have been clustered in the northern part of the country and involve port development and maintenance. Coastal defences and port development are the two most important activities in the UK. Van Oord has reinforced its position in Scandinavia.

America, Mediterranean & Africa (EUR 180 million turnover)
This region covers three continents: North and South America, the Mediterranean and Africa.
Brazil has been our home base in South America for twenty-five years. We have a permanent branch office in Rio de Janeiro and deploy our own equipment – sailing under the Brazilian flag – on projects in Brazil, in particular port projects in such places as Recife, Rio de Janeiro, Itajai, São Luis and Suape. The Brazilian market for marine contracting consists mainly of port and waterway maintenance. In Mexico, we were involved in the beach replenishment project in Cancun, important for the area’s tourism industry. For the past several years, we have been carrying out regular maintenance in Venezuela’s Orinoco River and the shipping lane in Lake Maracaibo.
Spain is an important home base in the region, and our main activities there consist of port expansion and maintenance and beach maintenance. We have a joint venture in Spain with Dragados, one of Europe’s biggest contractors, which operates under the name Dravo S.A. This company has its own dredging equipment. Spain is also our base for projects in Portugal and Italy. 
Van Oord has been active non-stop in Nigeria since 1963. At the moment, our most important projects there involve work for the oil and gas industry, land reclamation, and maintenance to ensure the navigability of waterways. Our biggest and most significant project in 2009 involved deepening the River Niger. In Tunisia, we undertook maintenance work for the ports of La Goulette, Sfax and Radès.

Middle East (EUR 216 million turnover)
Much of our turnover in the Middle East evaporated, especially in Dubai. Land reclamation nevertheless continued to be a significant activity in 2009, although at a much lower level. Artificial islands are being constructed both in Dubai and Abu Dhabi. Two of the Dubai islands, Pearl Jumeirah (part of the Jumeirah Garden Islands Project) and Al Mamzar (part of Palm Deira), will be zoned for residential accommodation. The island A6 near Al Dabby’ia, Abu Dhabi, is intended for the oil and gas industry. In addition to land reclamation, the two projects also involved coastal protection work. We deepened the harbour in the emirate of Ras al Khaimah and constructed a new breakwater. We also performed maintenance dredging in the cooling water intake channel of Subiya power station, work that falls under a five-year maintenance contract with the government of Kuwait. Phase 4 of the Sohar port expansion project in Oman began in 2009 and will be completed in 2010. Our contract with Jordan to dredge salt reefs in the Dead Sea has been renewed for another year. 

Asia & Australia (EUR 209 million turnover)
India is an important site of Van Oord’s activities in the Asia & Australia region. Most of our work there concerns port development and maintenance, both required to meet the demands of the growing volume of maritime transport and the related economic development. Van Oord has a permanent branch office in Mumbai. We deploy equipment that sails under Indian flag on many of our projects. The Chinese economy has also continued its robust growth, but the market is a difficult one for foreign companies. Nevertheless, Van Oord once again deployed a cutter suction dredger in China. Our Shanghai office plays in important role in the purchase of equipment constructed in China. There was as yet no large-scale resumption of the supply of sand to Singapore, and our projects there made little progress as a result. Van Oord was involved in various maritime infrastructure development projects in Malaysia. The worldwide economic crisis affected Australia’s export of raw materials in the past year, and there were very few port projects put out to tender as a result. 

Offshore (EUR 302 million turnover)
Van Oord continued to boost its position in the offshore energy infrastructure market. We concentrated on constructing landfalls for oil and gas pipelines, executing Engineering, Procurement & Construction contracts for offshore loading and unloading stations, and installing rock on the seabed to protect and stabilise pipelines. Van Oord undertakes these activities worldwide. In 2009, we were involved in projects in Russia (Baydaratskaya Bay), the North Sea (Ormen Lange), Ireland (Corrib), the Emirates (Fujairah) and Australia (Pluto).

Offshore Wind Projects (EUR 148 million turnover)
After successfully completing the Princess Amalia Windpark along the Dutch coast, we began the first phase of constructing the Belwind offshore wind farm off the coast of Belgium in mid-2009. After Econcern went into liquidation, new owners took over the concession for this wind farm. Van Oord is once again serving as the Engineering, Procurement & Construction contractor. The contract involves building the 55 foundations (including erosion protection) and complete electricity supply station for the wind turbines, installing the turbines, and connecting them to the Belgian electricity mains. We will finish our work in late 2010. Once the first phase of the project is completed in 2011, 165,000 households will benefit from clean energy. 

Wicks (EUR 9 million turnover)
In late 2008, we concentrated our worldwide deep compaction, vertical drainage and drilling and blasting activities into a new business unit, Wicks. Wicks is an independent organisation that works for Van Oord and for third parties. Outside Europe, it focuses mainly on more specialised projects, for example installing vertical drainage facilities down to a depth of more than thirty metres.

Investment

Investment in innovation and equipment is part of our long-term effort to offer our clients the best possible and most sustainable solutions to their problems. Our EUR 1 billion investment programme, which we launched in 2007, will run until the end of 2011. Our shipbuilding activities in China are of immense strategic importance in keeping the cost of our new vessels competitive. 

We are proud that Her Royal Highness Princess Máxima of the Netherlands christened and launched trailing suction hopper dredger Vox Máxima on 24 April 2009. The vessel’s hopper capacity is 31,200 m3. IHC Dredgers B.V. delivered the vessel on 21 January 2010, after which it was deployed on the Maasvlakte 2 port expansion project in Rotterdam.

Backhoe Goliath was completed in 2009 and deployed on the port project in Barcelona, Spain. Backhoe Simson will be completed in the spring of 2010 and will be deployed on various European projects. Flexible fallpipe vessel Stornes, which has a capacity of 27,000 tonnes, is under construction at the Raffles yard in Yantai, China. The vessel will be completed in the autumn of 2010. We also had six sand transport barges constructed in Dalian, China, with a hopper capacity of 10,000 m3 each. The first three were completed in 2009. The final barge will be completed in March 2010. Four self-propelled split barges, named after famous Dutch maritime engineers (Jan Blanken, Jan Leeghwater, Pieter Caland and Cornelis Lely), are under construction at a yard in Dalian, China. Each one has a hopper capacity of 2850 m3. They will be completed in the spring of 2010. Two water-injection vessels, the Draga Tocatins and the Draga Rio Madeira, were constructed in Brazil. Both are now in operation.

In early 2010, Van Oord laid the keel of giant self-propelled cutter suction dredger. The new vessel, which will be christened the Athena, will be one of the largest cutter suction dredgers in the world. It is being constructed at IHC Dredgers B.V. in Kinderdijk, Netherlands.

Financing

The available lines of credit come to a total of EUR 447 million with a remaining term to maturity ranging from two to seven years. The total sum taken out in loans is EUR 247 million. The interest rate risk on the available credit lines has been covered on the futures market, based on the anticipated drawdown periods in the years ahead. Cash at bank and in hand came to EUR 297 million at year-end. Our company is financially healthy. The credit lines are more than sufficient to cover the current investment programme. With solvency standing at 30.1% and our capital base at 32.7% of total assets, the company’s financial basis is sound.

Prospects

Conditions of stagnating growth prevail in many areas of the world. Our industry tends to lag behind the economic cycle, and that means that 2010 is likely to be a more difficult year for Van Oord. We expect our contract volume to decline. In view of the immense uncertainty involved, it is impossible for us to predict what our turnover or results will be in 2010. We have opportunities in new markets, for example offshore wind farms, and in existing markets, for example services to the offshore industry. In addition to our sound financial structure, we have a flexible organisation made up of individuals who are used to dealing creatively and efficiently with changing market circumstances. This gives us confidence about the future.

The General Meeting of Shareholders will take place on 22 April 2010.
 

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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