Arcadis Nv · EURONEXT:ARCAD
Arcadis Nv — FY2017 Earnings Presentation
31 slides from Arcadis Nv's earnings presentation, Feb 15, 2018
Slide 1: Full Year Results 2017
FULL YEAR RESULTS 2017 Peter Oosterveer | CEO Renier Vree | CFO Amsterdam 15 February 2018
Slide 2: Disclaimer
DISCLAIMER Statements included in this presentation that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward-looking state
Slide 3: Peter Oosterveer, Chief Executive Officer
PETER OOSTERVEER MELBOURNE METRO Chief Executive Officer Melbourne, Australia
Slide 4: Performance Improvement
PERFORMANCE IMPROVEMENT Net revenue & organic growth Operating EBITA (margin) Free cash flow € millions and % € millions and % € millions 5%400 139,8 1% 0% 1% 10.1% 121 350 9.6% 119,8 0% 103 98 -4% 300 7.6% 99,8 250 7.1% 80 2.6 2.5 2.4 -5%250 203 79,8 175 186 2.0 200 -10% 59,8 150 39,8 100 -15% 50 1
Slide 5: On track to deliver on our 2018-2020 strategic priorities
ON TRACK TO DELIVER ON OUR 2018-2020 STRATEGIC PRIORITIES STRATEGIC PRIORITIES PROOF POINTS 2017 • Voluntary staff turnover • People first • Staff engagement • Continued investment in Arcadis Academy • Brand • One brand, recognized thought leader • Clients • Focus on Global Key Clients (17% growth i
Slide 6: Renier Vree, Chief Financial Officer
RENIER VREE Chief Financial Officer NIKE DISTRIBUTION CENTER Belgium 15 February 2018 | FY 2017 Results Presentation | © Arcadis 2018 | 6
Slide 7: Q4 / Full Year 2017 – Financial Overview
Q4 / FULL YEAR 2017 – FINANCIAL OVERVIEW • Operating EBITA margin In € millions FY 2017 FY 2016 Change Q4 2017 Q4 2016 Change improved to 7.6% (2016: 7.1%) Gross revenues 3,219 3,329 -3% 805 854 -6% Net revenues 2,437 2,468 -1% 595 608 -2% • Non-operating costs of €25 Organic growth 1% 3% million (2
Slide 8: Full Year 2017 – Net Income and EPS
FULL YEAR 2017 – NET INCOME AND EPS • EBIT(D)(A): 2016 included a €19 million In € millions FY 2017 FY 2016 Change provision release EBITDA 200 207 -3% • Amortization 2016 included €15 million Depreciation -40 -41 impairment EBITA 161 166 -3% Amortization -31 -53 • Net finance expense decreased due
Slide 9: Revenue and Operating EBITA
REVENUE AND OPERATING EBITA Net Revenues and organic growth • Q4 organic net revenue growth 3%; all regions except € millions, % for Latin America and the Middle-East contributed to 700 3% 3% 680 -1% 0% this growth 660 -3% 640 620 • FY return to organic net revenue growth of 1%: 600 580 - North Amer
Slide 10: Cash Flow Statement
CASH FLOW STATEMENT • Free cash flow improved to €98 million (2016: €80 million) due to higher EBIT In € millions FY 2017 FY 2016 EBIT 130 113 • D&A: 2016 included €15 million impairment Depreciation and amortization 71 94 • Other: 2016 impacted by €19 million litigation provision EBITDA 200 207 rel
Slide 11: Strong free cash flow in 2017, net debt substantially below last year
STRONG FREE CASH FLOW IN 2017, NET DEBT SUBSTANTIALLY BELOW LAST YEAR Free Cash Flow EBITDA € millions € millions 98 107 80 100 100 100 -28 -62 H1'16 FY'16 H1'17 FY'17 H1'16 H2'16 H1'17 H2'17 Net Debt Average net debt / EBITDA € millions Calculated using bank covenants methodology 587 514 494 2.5 2.
Slide 12: Balance Sheet
BALANCE SHEET In € millions Assets 31 Dec 2017 31 Dec 2016 Equity and liabilities 31 Dec 2017 31 Dec 2016 Intangible assets 1,074 1,170 Equity 981 1,002 Fixed assets 93 100 Loans & borrowings 474 700 Other non-current assets 91 87 Other non-current liabilities 146 176 Trade receivables 579 622 Billi
Slide 13: Reduction working capital and DSO remains priority
REDUCTION WORKING CAPITAL AND DSO REMAINS PRIORITY Working capital 2016/2017 • NWC of 16.9% at a 3 year low, driven by € millions & as % of gross revenues Continental Europe 25% • Cash collection KSA and Qatar remains priority 19.9% 20.9% 19.9% 730 18.9% 19.3% 19.8% 17.5% 16.9% 20% 660 15% 590 10% 5
Slide 14: Ageing Receivables
AGEING RECEIVABLES • Overdue receivables include two large items: 31 December 2017 31 December 2016 In € millions - KSA: projects completed in 2016 Gross Gross As % As % receivable receivable - US: Oil & Gas project involving insurance Not past due 298 47% 341 50% Past due 0-30 days 109 17% 121 18%
Slide 15: Maturity Profile of Financing
MATURITY PROFILE OF FINANCING Maturity profile of debt • In 2018 €197 million of debt is expiring for € millions which various options are considered • Average interest expense at 3.2% (2016: 3.0%) 400 of gross debt 300 200 100 0 2018 2019 2020 2021 2022 2023 Bank Term Loans USPPs Revolving Credit F
Slide 16: Segments
SEGMENTS EUROPE & AMERICAS MIDDLE EAST ASIA PACIFIC CALLISONRTKL 15 February 2018 | FY 2017 Results Presentation | © Arcadis 2018 | 16
Slide 17: Americas
AMERICAS OUR PEOPLE 6,800 OUR CLIENTS Georgia DoT, USACE, Chevron, PG&E, GE, Sabesp, Vale, Vinci, Brookfield, GE, Codelco, Embraer % OF ARCADIS NET REVENUE 31% 7% 18% 43% 44% 33% 44% 48% 27% 25% 13% Infrastructure Public Consulting Water Regulated Program, project & cost mgmt Environment Private Des
Slide 18: Americas Segment 2017 Results
AMERICAS SEGMENT 2017 RESULTS In € millions FY 2017 FY 2016 Change Q4 2017 Q4 2016 Change Gross revenues 1,175 1,227 -4% 293 323 -9% Net revenues 751 769 -2% 175 187 -7% Organic growth -2% 1% EBITA 36.0 26.3 37% Operating EBITA1) 47.5 36.1 31% Operating EBITA margin 6.3% 4.7% Backlog organic growth
Slide 19: Brazil Clean Energy Assets
BRAZIL CLEAN ENERGY ASSETS • Arcadis Logos Energia (associate, 49.99% owned by Arcadis) has equity stakes in 6 biogas plants in Brazil that convert landfill gas into bio-methane (natural gas substitute) and power, thereby significantly reducing greenhouse gas emissions • In 2017 we re-assessed the b
Slide 20: Europe and Middle East
EUROPE AND MIDDLE EAST OUR PEOPLE 13,100 OUR CLIENTS Southern Water, HS2, Cross Rail 2, ProRail, Rijkswaterstaat, Societe du Grand Paris, Nike, Opel, Emaar, Vinci % OF ARCADIS NET REVENUE 46% 19% 22% 40% 37% 40% 53% 28% 38% 12% 11% Infrastructure Public Consulting Water Regulated Program, project &
Slide 21: Europe & Middle East Segment 2017 Results
EUROPE & MIDDLE EAST SEGMENT 2017 RESULTS In €millions FY 2017 FY 2016 Change Q4 2017 Q4 2016 Change Gross revenues 1,337 1,398 -4% 340 353 -4% Net revenues 1,113 1,117 0% 282 279 1% Organic growth 4% 4% EBITA 74.0 67.0 10% Operating EBITA1) 84.3 83.9 0% Operating EBITA margin 7.6% 7.5% Backlog orga
Slide 22: Asia Pacific
ASIA PACIFIC OUR PEOPLE 5,700 OUR CLIENTS Sung Hung Kai, China Resources, HSBC, Citi, Adidas, BMW, Huawei, Alibaba, LendLease, CPB, Acciona % OF ARCADIS NET REVENUE 14% 10% 28% 32% 30% 68% 4% 66% 2% 60% Infrastructure Public Consulting Environment Regulated Program, project & cost mgmt Buildings Pri
Slide 23: Asia Pacific Segment 2017 Results
ASIA PACIFIC SEGMENT 2017 RESULTS In € millions FY 2017 FY 2016 Change Q4 2017 Q4 2016 Change Gross revenues 387 378 2% 98 97 2% Net revenues 344 338 2% 85 84 1% Organic growth 2% 8% EBITA 30.1 30.7 -2% Operating EBITA1) 30.7 31.3 -2% Operating EBITA margin 8.9% 9.3% Backlog organic growth 6% DSO 85
Slide 24: CallisonRTKL
CALLISONRTKL OUR PEOPLE 1,700 OUR CLIENTS Nordstrom, AT&T, Emaar, Primark, Capital One, Stanford Healthcare % OF ARCADIS NET REVENUE 9% 3% 7% 15% 2% 21% 15% 47% 53% 95% 19% 23% Commercial Public America Retail Regulated Europe & Middle East Workplace Private China Healthcare Other 15 February 2018 |
Slide 25: CallisonRTKL Segment 2017 Results
CALLISONRTKL SEGMENT 2017 RESULTS In € millions FY 2017 FY 2016 Change Q4 2017 Q4 2016 Change Gross revenues 320 326 -2% 73 81 -10% Net revenues 229 244 -6% 53 58 -8% Organic growth -3% 0% EBITA 20.8 22.9 -9% Operating EBITA1) 23.9 24.3 -2% Operating EBITA margin 10.4% 9.9% Backlog organic growth -1
Slide 26: Peter Oosterveer, Chief Executive Officer
PETER OOSTERVEER EAST SIDE COASTAL Chief Executive Officer RESILIENCY New York, US 15 February 2018 | FY 2017 Results Presentation | © Arcadis 2018 | 26
Slide 27: Our Positioning
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 28: 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 integrated • Focus on where we can lead our people can be at their best and sustainable solutions to our • Deliver client and project exc
Slide 29: Delivering Sustainable Value
DELIVERING SUSTAINABLE VALUE Net Revenue & Organic growth Operating EBITA (margin) NWC% and DSO € millions and % € millions and % % and days Surpass 17.8% 2% 8.5% - 9.5% 17.5% 1% GDP 7.6% 7.4% <17.0% 7.1% 16.9% -4% 91 90 2.5 88 2.4 186 2.2 175 162 2016 2017 2017 Target 2016 2017 2017 Target 2016 201
Slide 30: Priorities 2018
PRIORITIES 2018 • Deliver financial objectives as per the strategic framework 2018-2020 • Select projects, businesses and geographies where we can lead • Improve project delivery • Invest in people and culture to build the workforce of the future • Innovate to become a digital frontrunner in the ind
Slide 31: Arcadis. Improving quality of life.
Arcadis. Improving quality of life. 15 February 2018 | FY 2017 Results Presentation | © Arcadis 2018 | 31