Koninklijke Bam Groep Nv · EURONEXT:BAMNB
Koninklijke Bam Groep Nv — Royal BAM Group — FY2014 Earnings Presentation
31 slides from Koninklijke Bam Groep Nv's earnings presentation, Feb 19, 2015
Slide 1: 2014 Results
2014 Results Annual results 2014 Amsterdam, 19 February 2015
Slide 2: BAM 2014 adjusted pre-tax result €62 million; Back in Shape on track
Royal BAM Group nv BAM 2014 adjusted pre-tax result €62 million; Back in Shape programme on track Adjusted result supported by strong Q4 at PPP and first Back in Shape savings Positive cash flow 2014 driven by divestments and improving trade working capital Results in operational sectors down in a d
Slide 3: Revenue and adjusted results per sector
Royal BAM Group nv Revenue and adjusted results per sector (in € million) 2014 2013 Revenue Result Revenue Result* Construction and M&E services 3,016 -5.5 3,078 23.0 Civil engineering 3,949 14.2 3,970 61.4 Property 477 19.6 236 -15.1 PPP 258 38.6 288 14.4 Eliminations and other -386 1.4 -530 -1.5 T
Slide 4: Construction and M&E services
Royal BAM Group nv Construction and M&E services (in € million) Market • Recovery IE and UK non-residential markets ongoing; Revenue Result cautious growth in NL residential; BE and DE unchanged stable. Business • Revenue: NL down due to weak residential house sales in 2013; UK helped by FX. • Resul
Slide 5: Civil engineering
Royal BAM Group nv Civil engineering (in € million) Market • Recovery IE and UK markets ongoing; NL cautious Revenue Result improvement; DE unchanged stable and BE uncertainty about government spending; INT strong opportunities. Business • Revenue: UK higher helped by FX and IE reflecting market pos
Slide 6: Property
Royal BAM Group nv Property (in € million) Market • Twin track development NL residential market. Revenue Result • Non-residential property UK picking up; BE and NL unchanged. Business • Revenue: residential higher reflecting house sales; non-residential higher due to divestment programme. • Result:
Slide 7: Property (cont’d)
Royal BAM Group nv Property (cont’d) Twin track development NL Consequences for BAM residential market • Cutting prices in some regional areas. • Demand recovering first in and around • Shifting from expensive to affordable homes major cities. in some developments, hence significantly • More demand
Slide 8: PPP
Royal BAM Group nv PPP (in € million) Market • Good opportunities in all home markets, UK lagging Portfolio (number) Result because of upcoming elections. Business • Portfolio: grew due to 6 project wins (hit rate 50%). • Result: excellent in 2014; book profits from 7 transfers and high contribution
Slide 9: Income statement
Royal BAM Group nv Income statement (in € million, unless stated otherwise) 2014 Margin 2013* Margin Total result sectors 68.3 0.9% 82.2 1.2% Group overhead -0.6 -1.2 Group interest charge -5.5 -5.8 Adjusted result before tax 62.2 0.9% 75.5 1.1% Restructuring -68.8 -25.4 Impairments -115.9 -30.0 Pen
Slide 10: Cash flow analysis
Royal BAM Group nv Cash flow analysis (in € million) 1H14 2H14 FY14 1H13 2H13 FY13 Net cash result -23 34 11 -13 59 46 Investments TFA -25 -17 -42 -39 -26 -65 ∆ Trade working capital -296 281 -15 -193 143 -50 Net Investment Property 19 64 83 -1 -25 -26 Net investment PPP 37 31 68 7 9 16 ∆ Other work
Slide 11: Key figures: balance sheet
Royal BAM Group nv Key figures: balance sheet (in € million, unless stated otherwise) FY14 FY13 • Improvement recourse net 624 548 cash position due to Cash position substantial divestments non- Interest-bearing debt 664 931 residential property and PPP Net debt position 40 383 projects. Recourse ne
Slide 12: Recourse leverage, interest coverage and solvency ratios
Royal BAM Group nv Recourse leverage ratio Recourse interest coverage ratio 4,0 9,0 3,0 7,8 7,6 7,7 1,5 8,0 7,3 7,4 7,3 2,0 6,4 6,6 6,8 1,0 7,0 0,0 -0,9 1,0 -1,1 0,9 1,4 1,4 5,5 0,9 0,8 6,0 5,0 -1,0 0,4 -0,1 4,8 4,5 -2,0 -0,2 -2,8 5,0 -3,0 4,0 -4,0 3,0 11Q4 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14
Slide 13: Dividend 2014
Royal BAM Group nv Dividend 2014 Since the net result for the year was negative there will be no dividend in respect of 2014. Annual results 2014 | 19 February 2015 13
Slide 14: Sustainability
Royal BAM Group nv Sustainability Safety (IF) CO2 (kTon) Waste (kTon) • IF (Incidents per millions hours worked) 6 5,8 300 300 277 reduced from 5.8 to 5.0 5,0 5 250 242 250 • CO2 emissions, 200 corrected for turnover, 4 200 200 184 reduced with 15% 3 150 150 • Construction and office waste, correcte
Slide 15: ‘Back in Shape’ programme
Royal BAM Group nv ‘Back in Shape’ programme Culture Structure Processes Cost reduction Working capital Project control Divestments Annual results 2014 | 19 February 2015 15
Slide 16: Cost reduction
Royal BAM Group nv Cost reduction (in € million) Overhead Simplification FTE reduction 650 600 550 500 450 end 2013 end 2015 Annual results 2014 | 19 February 2015 16
Slide 17: Project control
Royal BAM Group nv Project control Stage gate Peer review Operational audit Annual results 2014 | 19 February 2015 17
Slide 18: Trade working capital
Royal BAM Group nv Trade working capital Trade working capital Trade working capital (in € million) (in € million and TWC as %) 0 0% 3.000 2.000 -2% -200 1.000 -4% 0 -400 -1.000 -6% -2.000 -3.000 -600 -8% Q4 Q1 Q2 Q3 Q4 2013 2014 2014 2014 2014 -800 -10% Work-in-progress credit Work-in-progress debi
Slide 19: Divestments
Royal BAM Group nv Divestments Proceeds €100m Annual results 2014 | 19 February 2015 19
Slide 20: Back in shape timing, costs and benefits
Royal BAM Group nv Back in shape timing, costs and benefits (in € million) Actual H2 2014 H1 2015 H2 2015 Beyond 2015 Cost reduction P&L restructuring cost €53m ~ €30m Cash costs €9m ~ €60m ~ €15m Cost saving €8m > €100m Project margins Towards 2-4% Working capital reduction > €300m Divestments €170
Slide 21: Order book
Royal BAM Group nv Order book FY14 FY13 Δ • Order book stable; quality improving Construction and • Increase Construction and M&E services 4,424 4,013 +10% M&E services supported by stronger Pound Sterling Civil engineering 5,129 5,090 +1% • Order book lower at Property due to Property 859 983 -13%
Slide 22: Outlook
Royal BAM Group nv Outlook BAM is on course to deliver cost savings of at least €100 million (annual run rate) and a reduction in trade working capital of at least €300 million by year-end 2015. There will be a Back in Shape restructuring charge of approximately €30 million in 2015. BAM expects the
Slide 23: Annexes
Royal BAM Group nv Annexes Property Netherlands Property investments PPP investments Net debt analysis Revenue sector/country Group structure as from 1 January 2015 Stage gate tendering Annual results 2014 | 19 February 2015 23
Slide 24: Property Netherlands
Royal BAM Group nv Property Netherlands 2014 2013 Number of home sold from own development: Q1 444 265 Q2 492 266 Q3 488 379 Q4 453 455 Total 1,877 1,365 Stock of unsold and unlet premises : 1H14 FY13 - homes under construction (number) 132 288 - homes finished (number) 87 161 - commercial property
Slide 25: Property investments
Royal BAM Group nv Property investments Total investments (in € million, unless stated otherwise) Q4 2014 Q4 2013 (in € million) Land and building rights 420 484 42 36 Property development 403 544 Total investments (a) 823 1,028 82 Non-recourse loans 161 271 663 Recourse loans 57 71 Total loans (b)
Slide 26: Public private partnerships investments
Royal BAM Group nv Public private partnerships investments (in € million, unless stated otherwise) Q4 2014 Q4 2013 PPP assets (intangibles, receivables) 318 424 Non-recourse PPP loans -206 -295 Recourse PPP loans (equity bridges) -63 -76 PPP associates/JV/other 10 56 Investment equity1) 59 109 Commi
Slide 27: Net debt analysis
Royal BAM Group nv Net debt analysis (in € million, unless stated otherwise) FY14 FY13 Non recourse PPP loans 206 295 Non recourse project financing 170 276 Other project financing 135 157 Total ‘project related’ 511 727 Subordinated loan 124 124 Financial lease liabilities 22 43 Bank overdrafts and
Slide 28: Revenue sector/country
Royal BAM Group nv Revenue sector/country Construction Civil Property and M&E PPP Total engineering development Services Netherlands 15% 17% 4% 2% 38% United Kingdom 14% 13% 1% 0% 28% Belgium/L’bourg 3% 8% 1% 0% 12% Germany/Swiss 7% 5% - 0% 12% Ireland - 5% 0% 1% 6% International - 4% - - 4% Total 3
Slide 29: Group structure as from 1 January 2015
Royal BAM Group nv Royal BAM Group nv Group structure as from 1 January 2015 Executive Board Construction & Property Civil engineering NL UK DE BE IRE NL UK DE Intl. Business line support Business line support PPP Annual results 2014 | 19 February 2015 29
Slide 30: Stage gate tendering
Royal BAM Group nv Royal BAM Group nv Stage gate tendering Stage Gate 1 Stage Gate 2 Stage Gate 3 Stage Gate 4 Stage Gate 5 Decision Initial Approval of Approval final If won: to tender validation A-form contract reality check Tender Contract submitted awarded Annual results 2014 | 19 February 2015
Slide 31: Contact details
Royal BAM Group nv Contact details BAM Investor Relations Joost van Galen +31(0) 30 659 87 07 ir@bam.nl Annual results 2014 | 19 February 2015 31