overview results 2000 and first quarter 2001 results by harrie l.j. noy chairman of the executive...
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Overview results 2000 and First quarter 2001 results
By Harrie L.J. Noy Chairman of the Executive Board of ARCADIS NV
General Meeting of Shareholders Arnhem, May 23, 2001
Results full year 2000
ARCADIS on track with new strategyNet income +18% Results in line with strategic goals
Gross revenue•Growth 18% of which 7% autonomous
Operational margin•Operating income +26%•EBIT margin from 6.1 to 6.4%
Net income per share •16% higher at € 1.04
Net income FY 2000: EUR 20.7 mln
Gross revenue
Net revenue
Operating income
Net income
Net income per share
1999
655
460
27.8
17.6
0.90
2000
776
551
35.2
20.7
1.04
Growth
18%
20%
26%
18%
16%
Higher autonomous growth
•Autonomous
•Acquisitions
•Dollar
Gross revenue 2000
7%
6%
6%
Gross revenue Q4
11%
-6%
6%
Operating income 2000
12%
8%
6%
Major developments
•Strategic review
•New financial targets
•Strong autonomous growth in United States
•Solid contribution acquisitions
•Sale of Dutch environmental contracting
activities
•Integration of operations in Germany, United
States, The Netherlands
Development operating income
22.026.2 27.2 27.8
35.2
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
1996 1997 1998 1999 2000
+19% +4% +2% +26%
Development net income (excl. extraordinary items)
12.714.6 15.5
17.620.7
0.0
5.0
10.0
15.0
20.0
25.0
1996 1997 1998 1999 2000+15% +6% +14% +18%
Cash flow and balance sheet
•Sharp decline in
working capital
•Balance sheet stronger:
solvency to >37%
•Operational cash flow
doubled
0
10
20
30
40
50
60
1998 1999 2000Cash flow Operational cash flow
Gross revenue: Market segments
70
100
130
160
190
1999 2000
Buildings +30%
120
170
220
270
320
1999 2000
Infrastructure +17%
70
120
170
220
1999 2000
Environment +20%
70
90
110
130
150
1999 2000
Communications +18%
Infrastructure +17%
Major projects Netherlands Business parks through PPP
TEA-21 fuels U.S. growth Relocation greenhouses
Environment +20%
MNC program successful
GRiP distinguishing feature Integrated approach
Strong growth in U.S.
Buildings +30%
Olympia stadium Berlin
Acquisition Giffels in U.S. Turnkey projects in Spain
Facility management
Communications +18%
Glass fiber networks, last mile GSM networks
Real estate data Tele hotels
Gross revenue: Regions
100
150
200
250
300
1999 2000
Netherlands consulting +8%
100
110
120
130
140
150
1999 2000
Other Europe +1%
100
150
200
250
300
350
1999 2000
North- and South America +57%
0
20
40
60
80
100
1999 2000
Netherlands contracting -/- 7%
Geographical spread
Netherlands51%
Other Europe
21%North and
South America
28%
Netherlands44%
Other Europe
18%North and
South America
38%
1999 2000
EBITA: Regions
0
5
10
15
20
1999 2000
Netherlands +14%
0
2
4
6
1999 2000
Other Europe +22%
0
5
10
15
1999 2000
North- and South America +50%
Strategic review
Strong position:•Stable growth of revenues and income •Europe top 3 / worldwide no. 9•Strongest international network in the business
However:•Not reflected in share price•Organic growth limited
In short: strategic review
Market developments
•Globalization of clients
•Consolidation in the sector
•Governments pull back
•Industry: outsourcing and vendor reduction
•Changing roles
•Changing labor markets
More focus on value creation•Profitable growth is key
Clients Employees- more added value - project management- expansion services - training &
development- new clients - performance
based pay
Profitable growth
Shareholder value
•More emphasis on organic growth•Focus on existing home markets
Four strategic pillars
Accelerate
profitable growth
Organic growth existing core business
Strong growth in specific segments
Expansion services to industry
Acquisitions
New ambitious goals
1 Growth gross revenue- Autonomous - Acquisitions- Dollar-effect
2 Margin- EBIT/net revenue
3 Growth net income per share
Result 2000
18%7%6%5%
6.4%
16%
1995-1999
13%3%7%3%
19996.1%
8%
New goal
13%1/21/2-
In 20058%
15%
The following conditions apply:
•Excluding the effects of goodwill write-offs
•Excluding changes in exchange rate dollar - euro
•Market conditions show no major changes
•Growth rate in part depends on acquisitions
And : no change in pay-out ratio dividend
Results first quarter 2001 and outlook full year 2001
0
50
100
150
200
2000 2001
Gross revenue +7%
0
2
4
6
8
10
2000 2001
Operating income +10%
0
1
2
3
4
5
2000 2001
Net income +11%
0
50
100
150
2000 2001
Net revenue +10%
Net income 1st quarter 2001: EUR 3.6 mln
Highlights first quarter 2001•The Netherlands:
•Growth in infrastructure•Divestment Dutch environmental contracting activities
•Decline in demand real estate information services
•North- and South-America:•Good order intake infra + environment in U.S.
•Acquisition WSBC generates growth•Buildings, communications weaker•Strong growth Brazil
•Europe:•Healthy organic growth
Outlook market
• Infrastructure market remains good Netherlands: growing investment volume United States: TEA-21 continues Brazil: strong growth power-infrastructure
• Telecommunications grows, but slower Growth in Germany and Spain
• Private sector: stronger tendency outsourcing Opportunity for facility management
• Uncertainty American economy
Outlook 2001
• NL: infrastructure compensates real estate information
• USA: growth in infrastructure and environment• Extraordinary gain approx. EUR 2 million• Net income approx. 10% higher• Premise:
American economy remains level Unforeseen circumstances
• Excluding extraordinary gain and new acquisitions
ARCADIS on track to realize strategic goals
ARCADIS: from engineering firm …
to professional service provider for: infrastructure, environment, buildings and communications
•Broad range of services •Higher in the value chain •More added value •More fixed relationships/ partnerships
•Long term contracts
Realization
Engineering
Design
Fin., Legal, Permitting
Maintain
Project Development
Feasibility Studies
Program Consultancy