Arcadis Nv · EURONEXT:ARCAD
Arcadis Nv — Investor Day (2017)
93 slides from Arcadis Nv's investor day presentation, 2017
Slide 1: Creating a Sustainable Future
Arcadis Capital Markets Day 2017 CREATING A SUSTAINABLE FUTURE Our strategy, actions and results
Slide 2: Agenda for the Day
AGENDA FOR THE DAY 1. Introduction, vision and strategy Peter Oosterveer 2. Strategy implementation Mary Ann Hopkins (Americas) Stephan Ritter (Europe & Middle East) Alan Brookes (United Kingdom) Stephanie Hottenhuis (Asia Pacific) Greg Steele (Australia) 3. Financial framework Renier Vree 4. Summar
Slide 3: Our Team
OUR TEAM Peter Oosterveer Renier Vree Mary Ann Hopkins Stephan Ritter Stephanie Hottenhuis Chief Executive Officer Chief Financial Officer Americas Europe & Middle East AsiaPacific/CallisonRTKL First year with Arcadis 7 years with Arcadis 2 years with Arcadis 5 years with Arcadis 22 years with Arcad
Slide 4: Introduction, Vision and Strategy
INTRODUCTION, Peter Oosterveer VISION AND STRATEGY CEO Capital Markets Day 2017 © Arcadis 2017 4
Slide 5: Our Foundation for Growth
OUR FOUNDATION FOR GROWTH 100 DAYS, 5 HIGHLIGHTS Strong Committed client people relations Deep market Focus Opportunities sector insights & project for Growth & expertise delivery
Slide 6: The Arcadis Journey
THE ARCADIS JOURNEY Acquisition of Hyder Consulting and Callison Introduction of Arcadis brand Acquisition of name and logo EC Harris 1888 1959 1997 2007 2011 2012 2014 2015 2020 2030 CREATING A SUSTAINABLE FUTURE Start of export Acquisition of RTKL Acquisition of Langdon One global brand of water a
Slide 7: Arcadis at a Glance – Well Diversified
ARCADIS AT A GLANCE – WELL DIVERSIFIED GROSS REVENUE BREAKDOWN GROSS REVENUE BREAKDOWN BY SEGMENT BY SERVICE € 3.3 bn 2016 GROSS REVENUE 10% 10% 20% 12% 37% 35% ~ 27,000 PEOPLE WORLDWIDE 35% 41% 30,000+ PROJECTS ANNUALLY Americas Consultancy Europe & Middle East Program, Project & Cost management As
Slide 8: Our Expertise to Create a Sustainable Future
OUR EXPERTISE TO CREATE A SUSTAINABLE FUTURE INFRASTRUCTURE (24% gross revenues) WATER (13% gross revenues) AIRPORT SOLUTIONS WATER WATER FOR MANAGEMENT INDUSTRY HIGHWAYS AND INTELLIGENT TRANSPORT SYSTEMS RAIL AND URBAN TRANSPORT WATER CONVEYANCE PORTS AND INDUSTRIAL INFRASTRUCTURE WATER SUPPLY AND
Slide 9: A Global Market of ~$500 Billion, Growing in Line with GDP
A GLOBAL MARKET OF ~$500 BILLION, GROWING IN LINE WITH GDP 20 100 100 180 30 10 30 40 Adressable market in $ billion Source: IHS, GWI Capital Markets Day 2017 © Arcadis 2017 9
Slide 10: A Strong Global Market Position
A STRONG GLOBAL MARKET POSITION In US$ billion of engineering revenues 9.9 7.4 7.3 6.2 5.5 4.8 4.2 3.7 3.3 3.0 2.7 2.6 2.6 2.3 2.2 2.2 2.0 1.9 1.9 1.9 1.9 1.8 1.8 Arcadis AECOM AMEC HDR KBR Fluor Jacobs/CH2M CRCC CCC CRG DAR Group CCEC Tetra Tech CB&I LLC Sweco PCC China SNC Lavalin/Atkins Stantec A
Slide 11: Strategy
STRATEGY Capital Markets Day 2017 © Arcadis 2017 11
Slide 12: Strengths to Build On and Areas for Improvement
STRENGTHS TO BUILD ON AND AREAS FOR IMPROVEMENT STRENGTHS TO BUILD ON IMPROVEMENT AREAS • Global platforms • Organic revenue growth • One brand, recognized thought leader • Operating margin • Leadership positions in key markets • Focus on markets, solutions, and client sectors • Strong City program
Slide 13: Mega Trends That Create Opportunities
MEGA TRENDS THAT CREATE OPPORTUNITIES URBANIZATION SUSTAINABILITY & GLOBALIZATION DIGITIZATION & MOBILITY CLIMATE CHANGE Capital Markets Day 2017 © Arcadis 2017 13
Slide 14: Our Strategic Context
OUR STRATEGIC CONTEXT MEGA TRENDS STAKEHOLDER SUSTAINABLE DEVELOPMENT COMPETITIVE DIALOGUE GOALS RELEVANT FOR ARCADIS LANDSCAPE Urbanization Changing client & mobility patterns Sustainability & Employees Shift to digital climate change Clients Industry consolidation Globalization Suppliers/subcontra
Slide 15: Our Culture Is Based on Strong Values
OUR CULTURE IS BASED ON STRONG VALUES PEOPLE FIRST We care for each other and create a safe and respectful working environment where our people can grow, perform, and succeed CLIENT SUCCESS We are passionate about our clients success and bring insights, agility, and innovation to co-create value INT
Slide 16: A Sustainable Future Through Our Strategic Pillars
A SUSTAINABLE FUTURE THROUGH OUR STRATEGIC PILLARS PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Create an environment where • Grow through providing • Focus on where we can lead all our people can be their best integrated and sustainable • Deliver client and project solutions for our c
Slide 17: People & Culture
PEOPLE & CULTURE PEOPLE FIRST • Be the employer of choice • Create an environment to grow, perform and succeed LIVING OUR VALUES • Foster a balanced culture that is driven by our core values • Create business value through sustainable solutions DEVELOP AND RETAIN THE WORKFORCE OF THE FUTURE • Develo
Slide 18: Develop and Retain the Workforce of the Future
DEVELOP AND RETAIN THE WORKFORCE OF THE FUTURE Impact • Annual program for global early career professionals sponsored by the Lovinklaan GLOBAL SHAPERS & Foundation. The theme in 2017 was Sustainability for impact - Digital Solutions to improve ARCADIS ACADEMY quality of life. • Our global hub for l
Slide 19: Innovation & Growth
INNOVATION & GROWTH ADVISE & DELIVER SUSTAINABLE SOLUTIONS • Build scale where we can both advise and deliver • Apply integrated thinking to solve complexity for clients DIGITAL INNOVATION • Scale existing technologies • Explore new technologies in co-creation with clients LOCAL STRENGTH, GLOBAL REA
Slide 20: Embracing Digital Thinking, Expanding Capabilities
EMBRACING DIGITAL THINKING, EXPANDING CAPABILITIES TODAY TOMORROW AFTER TOMORROW • Data-driven business models • Human-centric digital solutions • Co-creation with clients 100% BIM1) Digital value propositions Digital lab SCALE INCUBATE EXPLORE 1) Building information modeling Capital Markets Day 20
Slide 21: Focus & Performance
FOCUS & PERFORMANCE FOCUS WHERE WE CAN LEAD • Build leadership positions based on relevance for clients, local presence and global positions • De-prioritize businesses that fail to meet our criteria CLIENT & PROJECT EXCELLENCE • Disciplined project and client selection and improved project delivery
Slide 22: The Arcadis Way Provides a True Competitive Edge
THE ARCADIS WAY PROVIDES A TRUE COMPETITIVE EDGE THE ARCADIS WAY – OUR HARMONIZED WAY OF WORKING PEOPLE & CULTURE INNOVATION & GROWTH FOCUS & PERFORMANCE Enable people to develop in a culture of Enhance client selectivity and pursue Improve project delivery via best client success and knowledge exch
Slide 23: Global Excellence Centers (GECs)
GLOBAL EXCELLENCE CENTERS (GEC’S) • Highly skilled multi-disciplinary capability • Integrated ‘One Team’ approach creates seamless project delivery GEC JOURNEY 10% 7% 4% 2,600 2,019 1,017 1,298 2014 2015 2016 2017 FTEs in GECs GEC staff as % total staff Capital Markets Day 2017 © Arcadis 2017 23
Slide 24: Our Strategic Framework 2018 - 2020
OUR STRATEGIC FRAMEWORK 2018 - 2020 PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Voluntary staff turnover • Organic Revenue Growth • Margin Voluntary staff turnover < Market • Surpass GDP growth in our Operating EBITA trending to 8.5% - markets 9.5% of net revenues in 2020 • Staff enga
Slide 25: Strategy Implementation
STRATEGY IMPLEMENTATION Capital Markets Day 2017 © Arcadis 2017 25
Slide 26: North America
NORTH AMERICA Mary Ann Hopkins Capital Markets Day 2017 © Arcadis 2017 26
Slide 27: North America - Returning to Profitable Growth
NORTH AMERICA - RETURNING TO PROFITABLE GROWTH OUR PEOPLE 5,200 OUR CLIENTS Georgia DOT, USACE, Chevron, PG&E, GE % OF ARCADIS NET REVENUE 28% Expertise Clients Services Countries 7% 3% 14% 32% 44% 45% 46% 28% 51% 97% 22% 11% Infrastructure Public Consulting US Water Regulated Program, project & cos
Slide 28: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Increased Infrastructure spending driven by local funding initiatives 2. Increased use of Design-Build and Public-Private Partnerships 3. Corporate social responsibility driving environmental priorities for private clients 4. Vulnerable cities developing and implemen
Slide 29: Implementing Our Strategy in North America
IMPLEMENTING OUR STRATEGY IN NORTH AMERICA PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Live our values and passion • Lead in addressing emerging • Build on the achievements to date: contaminants and grow Strategic • Turnaround Environment • Become the employer of choice Environmental
Slide 30: Dutch Expertise for Future Flood Protection
DUTCH EXPERTISE FOR FUTURE FLOOD PROTECTION Impact • Arcadis designs resilient infrastructure in New York City, protecting 200,000 residents EAST SIDE COASTAL and 21,000 businesses. RESILIENCY • Addresses flood protection following Superstorm Sandy. • A range of multifunctional resilience solutions
Slide 31: Reducing Traffic in a Congested City
REDUCING TRAFFIC IN A CONGESTED CITY Impact • Arcadis provides in-depth transportation knowledge, construction contract REGIONAL administration and quality and safety oversight. CONNECTOR • $1.55 Billion rail project in partnership with Los Angeles County Metropolitan TRANSIT PROJECT Transportation
Slide 32: Innovation for Emerging Contaminants
INNOVATION FOR EMERGING CONTAMINANTS Impact • Arcadis assessing portfolio of 85 Army facilities across the US to determine extent of PRELIMINARY PFAS contamination. ASSESSMENTS • Prioritizing and fast tracking sites/facilities into emergency response actions North America where PFAS releases are imp
Slide 33: Supporting Georgia's Growing Infrastructure Needs
SUPPORTING GEORGIA’S GROWING INFRASTRUCTURE NEEDS Impact • Arcadis provides full design and consulting support, including Intelligent Transportation ENGINEERING AND Systems, Traffic Operations, Asset management and maintenance. CONSULTING • Over 150 staff support the program that has a contract capa
Slide 34: Latin America
LATIN AMERICA Mary Ann Hopkins Capital Markets Day 2017 © Arcadis 2017 34
Slide 35: Latin America - Reposition for New Growth Cycle
LATIN AMERICA - REPOSITION FOR NEW GROWTH CYCLE OUR PEOPLE 1,550 OUR CLIENTS SABESP, Vale, Vinci, Brookfield, GE, Codelco, Embraer % OF ARCADIS NET REVENUE 3% Expertise Clients Services Countries 16% 3% 15% 25% 38% 37% 48% 24% 60% 60% 27% 47% Infrastructure Public Consulting Brazil Water Regulated P
Slide 36: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Macro-economic indicators improving in Brazil 2. Private and foreign capital responding to concessions, PPPs and M&A 3. Foreign contractors entering region 4. Signs of mining recovery in Chile & Peru 5. Political elections in Brazil and Chile create uncertainty Capit
Slide 37: Implementing Our Strategy in Latin America
IMPLEMENTING OUR STRATEGY IN LATIN AMERICA PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Rebuild spirit of the region after • Position early with contractors and • Rebalance business back to several years of contraction capital providers for concessions profitability and PPPs • Value, p
Slide 38: Preventing Pollution of the Tiete River
PREVENTING POLLUTION OF THE TIETE RIVER Impact • Arcadis has supported SABESP for over 45 years with engineering and program PROGRAM management support to reduce pollution to the Tiete River. MANAGEMENT • Over $15B has been invested to capture and treat wastewater. FOR TIETE RIVER • More than 22 mil
Slide 39: Reducing Impacts During Construction
REDUCING IMPACTS DURING CONSTRUCTION Impact • Arcadis has provided design services for all Santiago Metro lines since 2000. METRO • Metro line 3 was a 22 KM extension with 18 new stations. LINES • Considered environmental impacts in design • Project fostered collaboration with other Arcadis entities
Slide 40: Break
BREAK Capital Markets Day 2017 © Arcadis 2017 40
Slide 41: Continental Europe
CONTINENTAL EUROPE Stephan Ritter Capital Markets Day 2017 © Arcadis 2017 41
Slide 42: Continental Europe – Outperforming in Our Markets
CONTINENTAL EUROPE – OUTPERFORMING IN OUR MARKETS OUR PEOPLE 6,150 OUR CLIENTS ProRail, Rijkswaterstaat, Societe du Grand Paris, Nike, Opel % OF ARCADIS NET REVENUE 22% Expertise Clients Services Countries 6% 20% 28% 14% 35% 37% 55% 45% 15% 49% 25% 9% 27% 16% 19% Infrastructure Public Consulting Net
Slide 43: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Significant focus on Sustainability and urban resilience 2. Continued investments in private sectors 3. Increase spend in public sectors (with more country based variability) 4. Success driven by asset knowledge, integrated offerings and European coverage 5. Asset kn
Slide 44: Implementing Our Strategy in Europe
IMPLEMENTING OUR STRATEGY IN EUROPE PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Accelerate diversity and inclusion • Grow integrated capex solutions • Improve project delivery with a spirit programs for industry clients across Europe of continuous improvement • Invest in front end des
Slide 45: Enhancing Economic Growth in Paris
ENHANCING ECONOMIC GROWTH IN PARIS Impact - Arcadis is executing a €80 million contract to deliver 60+ stations and 200km + of GRAND PARIS new metro lines, 90% of which will be underground EXPRESS METRO - These metro lines are expected to carry 2 million passengers per day, an France investment of a
Slide 46: An Energy Neutral Storage and Office Complex
AN ENERGY NEUTRAL STORAGE AND OFFICE COMPLEX Impact • The 150,000 m2 complex is energy-neutral, using low-energy lighting, closed water NIKE DISTRIBUTION loops, green roofs and walls, and environmentally friendly hybrid robot cranes. CENTER • Arcadis provided structural and infrastructural engineeri
Slide 47: 100% BIM for Expansion Learning Center
100% BIM FOR EXPANSION LEARNING CENTER ABB BERLIN BUILDING Berlin, Germany Impact • Arcadis and its partner TU Berlin were commissioned to design a new building on a heritage industrial complex with 100% BIM. • Simulations of user behavior, life cycle cost analysis and energy efficiency data are bei
Slide 48: New A-Terminal to Accommodate Growth
NEW A-TERMINAL TO ACCOMODATE GROWTH Impact • Arcadis won a €20 million contract to perform project and construction management NEW TERMINAL AT for the new terminal and pier. SCHIPHOL AIRPORT • Expanding capacity from 63 million passengers today to 80 million passengers in The Netherlands 2023. • The
Slide 49: Middle East
MIDDLE EAST Stephan Ritter Capital Markets Day 2017 © Arcadis 2017 49
Slide 50: Middle East - De-risk Through Focus and Selectivity
MIDDLE EAST- DE-RISK THROUGH FOCUS AND SELECTIVITY OUR PEOPLE 2,200 OUR CLIENTS Emaar, Vinci, Ashghal, Kahramaa, Sabb % OF ARCADIS NET REVENUE 7% Expertise Clients Services Countries 3% 21% 33% 38% 9% 41% 48% 52% 56% 70% 13% 2% 14% Infrastructure Public Consulting UAE and Oman Water Regulated Progra
Slide 51: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Regional dynamics causing business uncertainty 2. Major projects reprioritized due to budget deficits related to the oil price 3. Region has been embarking on a productivity-led transformation 4. National Visions will provide future opportunities UAE National Vision
Slide 52: Implementing Our Strategy in the Middle East
IMPLEMENTING OUR STRATEGY IN THE MIDDLE EAST PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Collaborate with UK on university • Grow top 20 clients, increasing share • Sharpen focus on selection of program to attract mobile talent of wallet profitable clients and projects • Differentiate
Slide 53: Innovating with World-Class Mixed-Use Development
INNOVATING WITH WORLD-CLASS MIXED-USE DEVELOPMENT Impact • Arcadis was appointed to provide lead consultant, design and supervision services CITY WALK for 34 buildings on leisure, retail and entertainment facilities • The development utilized high-levels of pre-fabrication, off-site manufacturing an
Slide 54: Sustainable and Future Proof Headquarter
SUSTAINABLE AND FUTURE PROOF HEADQUARTER Impact • Arcadis is providing integrated engineering (MEP), traffic planning, site supervision HEADQUARTER and cost management solutions as well as landscape, waste and security advice. SABB • The SABB headquarters is the first fully-certified LEED Gold build
Slide 55: Improving Health & Safety Through Drone Technology
IMPROVING HEALTH & SAFETY THROUGH DRONE TECHNOLOGY NATIONAL VISION 2030 - ORBITAL HIGHWAY Qatar Impact • Arcadis was the first design & consultancy in Qatar to secure the authorization required to use drone technology. • Arcadis provided volumetric calculations for the earthwork spread of the Orbita
Slide 56: United Kingdom
UNITED KINGDOM Alan Brookes Capital Markets Day 2017 © Arcadis 2017 56
Slide 57: United Kingdom - Capitalize on Market Leadership
UNITED KINGDOM - CAPITALIZE ON MARKET LEADERSHIP OUR PEOPLE 4,400 OUR CLIENTS Southern Water, HS2, Cross Rail 2, Jaguar Land Rover % OF ARCADIS NET REVENUE 16% Expertise Clients Services Countries 16% 22% 35% 30% 44% 46% 100% 38% 48% 9% 12% Infrastructure Public Consulting UK Water Regulated Program
Slide 58: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Lack of clarity of what Brexit means causes lower client confidence 2. UK economy still growing and has real opportunity 3. Lower GBP is bringing continued foreign investment 4. Housing is a key issue - 200,000 more homes needed 5. The volume of major infrastructure
Slide 59: Implementing Our Strategy in the United Kingdom
IMPLEMENTING OUR STRATEGY IN THE UNITED KINGDOM PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Reduce attrition & enhanced • Sector, asset and digital • Program management, performance- engagement score knowledge for focused client driven design engineering growth and city focus • Strate
Slide 60: Global Excellence Center: Rail UK
GLOBAL EXCELLENCE CENTER: RAIL UK • Growth booster UK • Adopting new technologies (BIM, Big Data, 3D outputs) • Efficiency gains • Exceeded client expectations 500 400 300 200 100 0 2010 2011 2012 2013 2014 2015 2016 2017 GEC Rail # people UK Rail # people Capital Markets Day 2017 © Arcadis 2017 60
Slide 61: Agile and Modern New Headquarters
AGILE AND MODERN NEW HEADQUARTERS Impact • Arcadis provides cost and project management for the development of NEW SCOTLAND a modern, agile new headquarters called ‘New Scotland Yard’. YARD OFFICE • The building is considered to be of special merit and local significance and provides a welcoming and
Slide 62: Next Generation Garden Town
NEXT GENERATION GARDEN TOWN Impact • Arcadis is exploring how technology and digitalization can be used OTTERPOOL PARK in the next generation of garden settlements. RESIDENTIAL AREA • The aim is to improve quality of life for residents by creating up to 12,000 new homes an hour’s train ride from Lon
Slide 63: Creation of Integrated Public Transport Hub
CREATION OF INTEGRATED PUBLIC TRANSPORT HUB Impact • Arcadis creates an integrated public transport hub that will provide a BELFAST world-class gateway for Belfast, linking it to national and international markets. TRANSPORT HUB • Improves passenger journeys and provides better, more modern faciliti
Slide 64: Multi-Disciplinary 3D Model for Strategic Route
MULTI-DISCIPLINARY 3D MODEL FOR STRATEGIC ROUTE LOWER THAMES CROSSING UK Impact • Leadership and delivery roles in the Information Systems work package: Information Management, BIM and Asset Data Management. • The multi-disciplinary 3D model can feed into a future asset management database, enabling
Slide 65: Asia
ASIA Stephanie Hottenhuis Capital Markets Day 2017 © Arcadis 2017 65
Slide 66: Asia – Growth Through Local Depth and Global Expertise
ASIA – GROWTH THROUGH LOCAL DEPTH AND GLOBAL EXPERTISE OUR PEOPLE 4,300 OUR CLIENTS Sung Hung Kai, China Resources, HSBC, Citi, Adidas, BMW, Huawei, Alibaba % OF ARCADIS NET REVENUE 9% Expertise Clients Services Countries 11% 12% 11% 6% 15% 2% 2% 8% 39% 11% 87% 86% 83% 27% Infrastructure Public Cons
Slide 67: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Significant growth in transportation and infrastructure 2. One Belt, One Road 3. Increasing influence of Chinese investors in Asia and internationally 4. Growth of new sectors; industrial, logistics, leisure and entertainment 5. Increased relevance of livability and
Slide 68: Implementing Our Strategy in Asia
IMPLEMENTING OUR STRATEGY IN ASIA PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Brand recognition • Sustainable cities • Excel in project and client selection and improve project • Become the employer of choice • Lead and “self-disrupt” delivery in cost management • Attract and retain t
Slide 69: New Facility to Meet Growing Demand
NEW FACILITY TO MEET GROWING DEMAND Impact • Arcadis manages delivery of a high-profile scheme for manufacturing and BMW production facility development. NEX-PLANT • In 2016 this award-winning project was recognized by the client for outstanding performance. Shenyang, China Capital Markets Day 2017
Slide 70: Global Knowledge for a Global Client
GLOBAL KNOWLEDGE FOR A GLOBAL CLIENT Impact • Citibank extended the scope of Arcadis’ Governance and Control services by including GOVERNANCE AND EMEA. CONTROL SERVICES • Arcadis brings deep stakeholder knowledge and delivers a high level of technical ability and global expertise, supported by of Gl
Slide 71: Meeting Long-Term Needs for Water
MEETING LONG-TERM NEEDS FOR WATER Impact • Arcadis is design consultant for the extension of Singapore’s deep tunnel system. DEEP TUNNEL • We deliver value through our global collaboration, expertise and experience. SEWAGE SYSTEM • Water is collected and transported to a reclamation plant for recycl
Slide 72: Integrated Water Management of Sponge City
INTEGRATED WATER MANAGEMENT OF SPONGE CITY Impact • Arcadis is principal consultant for Sponge City in Wuhan, providing technical, WUHAN policy and program management advisory. SPONGE CITY • Our approach holds, cleans and drains water, ecologically-friendly. • Outcome is a city more resilient to cli
Slide 73: Opportunity for Ambitious Infrastructure Plan
OPPORTUNITY FOR AMBITIOUS INFRASTRUCTURE PLAN Impact • One Belt One Road is an ambitious program by the Chinese government to build ONE BELT and upgrade highways, railways, ports, industrial facilities and other trade supporting ONE ROAD infrastructure throughout Asia, Africa and Europe. INFRASTRUCT
Slide 74: Australia
AUSTRALIA Greg Steele Capital Markets Day 2017 © Arcadis 2017 74
Slide 75: Australia - Sustain the Momentum in Urban Growth
AUSTRALIA - SUSTAIN THE MOMENTUM IN URBAN GROWTH OUR PEOPLE >1,300 OUR CLIENTS (Regional) Government, LendLease, CPB, Acciona, Charter Hall, GPT % OF ARCADIS NET REVENUE 5% Expertise Clients Services Countries 17% 33% 36% 58% 20% 100% 62% 63% 9% 2% Infrastructure Public Consulting Australia Water Re
Slide 76: Market Trends & Opportunities
MARKET TRENDS & OPPORTUNITIES 1. Australia GDP – 3% for the last few years 2. Stable political system 3. Our key markets of Infrastructure, Environment and Buildings are solid 4. High population growth in major cities 5. Energy and Resources sectors on the way back 6. Digital disruption starting but
Slide 77: Implementing Our Strategy in Australia
IMPLEMENTING OUR STRATEGY IN AUSTRALIA PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Creating a diverse and inclusive • Strengthen capabilities early in • Strong programs for client culture the value chain selection and pursuit excellence • Living our values (strong programs • Renewed f
Slide 78: Design for Biggest Public Transport Project
DESIGN FOR BIGGEST PUBLIC TRANSPORT PROJECT Impact • Arcadis appointed as lead designer for stage 2 of the Sydney Metro project, the biggest SYDNEY transport project with the longest railway tunnels ever built in Australia. METRO • Broad multidisciplinary expertise was critical to solving issues aro
Slide 79: Exceeding Expectations with Arcadis Technology
EXCEEDING EXPECTATIONS WITH ARCADIS TECHNOLOGY Impact • Project implemented Arcadis technology that was developed in Australia. PFAS REMEDIATION • The solution developed by Arcadis exceeded all other available options. WORK Australia Capital Markets Day 2017 © Arcadis 2017 79
Slide 80: First Major Investment in Health Infrastructure
FIRST MAJOR INVESTMENT IN HEALTH INFRASTRUCTURE Impact • New 5 level hospital. NORTHERN • First major investment in health infrastructure in the Northern Beaches area of Sydney. BEACHES HOSPITAL • Arcadis providing structural, civil, façade and traffic engineering services. Sydney, Australia Capital
Slide 81: Advising for Sustainable Logistics
ADVISING FOR SUSTAINABLE LOGISTICS Impact • Arcadis provides freight logistics and sustainability advisory services enabling MOOREBANK the client to obtain clean energy funding to develop the facility and incorporate LOGISTICS PARK large-scale renewable energy sources. • Demonstrated that net greenh
Slide 82: Financial Framework
FINANCIAL FRAMEWORK Renier Vree CFO Capital Markets Day 2017 © Arcadis 2017 82
Slide 83: Our Strategic Framework 2018 - 2020
OUR STRATEGIC FRAMEWORK 2018 - 2020 PEOPLE & INNOVATION FOCUS & CULTURE & GROWTH PERFORMANCE • Voluntary staff turnover • Organic Revenue Growth • Margin Voluntary staff turnover < Market • Surpass GDP growth in our Operating EBITA trending to 8.5% - markets 9.5% of net revenues in 2020 • Staff enga
Slide 84: Realistic Targets Based on Strategic Drivers
REALISTIC TARGETS BASED ON STRATEGIC DRIVERS REVENUES (€M) AND ORGANIC GROWTH OPERATING MARGIN (In %) Surpass GDP (In % of net revenues) 1% 0% 0% -4% 3.4 Gross Revenue 3.3 10.1% 9.6% 8.5%-9.5% 2.6 2.4 Net Revenue 7.1% 6.8% Organic Net Revenue growth (%) 2014 2015 2016 2017 Q3 Target 2014 2015 2016 2
Slide 85: Focus on Cashflow to Implement Strategic Roadmap
FOCUS ON CASHFLOW TO IMPLEMENT STRATEGIC ROADMAP… NET WORKING CAPITAL AS % OF GROSS REVENUES DSO IN DAYS 18.4% 91 92 17.4% 17.5% 83 84 <85 17.1% <17.0% 2014 2015 2016 2016 Target 2014 2015 2016 2016 Target pro-forma 1) pro-forma 1) 1 Pro-forma: excluding CallisonRTKL • Focus on clients with good pay
Slide 86: With an Efficient and Robust Capital Structure
…WITH AN EFFICIENT AND ROBUST CAPITAL STRUCTURE Return on Invested Capital Leverage ratio Net Debt / EBITDA 1) (In %) 13.7% 2.5 2.2 2.0 9.3% >10.0% 1.5 6.8% 1.0 2014 2015 2016 Target 2014 2015 2016 Target 1) Average net debt/EBITDA: calculated according to bank covenant methodology • Higher profitab
Slide 87: Funding in Place to Realize Strategic Initiatives
FUNDING IN PLACE TO REALIZE STRATEGIC INITIATIVES Sources of funds MATURITY PROFILE OF DEBT € million • Operating cash flow • Divestments 400 Use of funds 300 • Capital & people investments • Dividend 200 • Acquisitions/Digital strategy 100 • Repay debt • Return cash to shareholders if leverage sust
Slide 88: Risk Management Is Embedded in Our Daily Practices
RISK MANAGEMENT IS EMBEDDED IN OUR DAILY PRACTICES Key risk mitigating controls • Strong culture and clear values • Diversified business • Aligned regional strategy implementation plans STRATEGIC RISKS OPERATIONAL RISKS COMPLIANCE RISKS • Cost efficiency including use of GEC’s • Innovation through D
Slide 89: In Summary
IN SUMMARY 1. Our Key Performance Indicators are clear and cover the breadth of our stakeholders 2. We have realistic targets based on our strategic performance drivers 3. We focus on cash flow to fund our strategic roadmap 4. We execute our strategy with an efficient and robust capital structure 5.
Slide 90: Summary
Peter Oosterveer SUMMARY CEO Capital Markets Day 2017 © Arcadis 2017 90
Slide 91: Improving Quality of Life
WELL POSITIONED TO DELIVER ON OUR STRATEGY IMPROVING QUALITY OF LIFE CREATING A SUSTAINABLE FUTURE PEOPLE & CULTURE INNOVATION & GROWTH FOCUS & PERFORMANCE Capital Markets Day 2017 © Arcadis 2017 91
Slide 92: Q&A
Q&A Capital Markets Day 2017 © Arcadis 2017 92
Slide 93: Creating a Sustainable Future
CREATING A SUSTAINABLE FUTURE