Koninklijke Heijmans N.v. · EURONEXT:HEIJM
Koninklijke Heijmans — Non-Deal Roadshow (September 2020)
76 slides from Koninklijke Heijmans's roadshow presentation, September 2020
Slide 1: Heijmans Business Update
Heijmans Business Update ROADSHOW BOOKLET, SEPTEMBER 2020, BASED ON 2020 INTERIM RESULTS
Slide 2: Key figures H1 2020
2 Key figures H1 2020 Key figures (x € 1 million) H1 2020 H1 2019 2019 Revenues 839 730 1.600 Underlying EBITDA* 41 36 78 Result after tax 15 15 30 Earnings per share (in €) 0,71 0,71 1,40 Order book 1.972 2.091 2.124 Net debt 43 99 30 Solvency 27% 25% 25% Number of FTE 4.642 4.624 4.595 * Underlyin
Slide 3: Contents
3 Contents • Company profile 4 - 13 • Strategy 14 - 25 • Environmental, Social, Corporate Governance (ESG) 24 - 29 • Dutch construction market 30 - 37 • 2020 Interim results / Outlook 38 – 45 • Financing, cash flow, financial statements 46 - 49 • Case studies 54 - 65 • Appendices 67 - 76 • Impact IF
Slide 4: Company profile
HEIJMANS ONE Company profile 4
Slide 5: History
5 COMPANY PROFILE History 1923 – founded by Jan Heijmans as Infra company 1945 and beyond - strong growth following WWII 1960’s - diversification towards residential building 1980’s - diversification towards property development 1993 – listing on Amsterdam Stock Exchange 1993/2007 – strong growth th
Slide 6: Organisation chart Heijmans N.V.
6 Organisation chart Heijmans N.V. Property Development Property Building & Infrastructure Development Technology
Slide 7: Heijmans at a glance
7 • Approximately 4,500 employees work on a daily basis for COMPANY PROFILE these business segments in the Netherlands. More than 99% of these employees are covered by a collective labour agreement. • Ambition to achieve a leading position on quality, Heijmans at a glance sustainability and profitab
Slide 8: Restructuring provides potential
Jan-2018 Jul-2009 Apr-2012 Dec-2012 Aug-2013 Dec- 2014 Appointment Nov-2009 2010 350 FTE Feb-2016 Feb-2017 of CRO, and € 100 mio 2011 disposal of 250 FTE ‘Sub-10’ disposal disposal of reductions Extension Extension merge of rights issue restructuring Telecom activities reduction share issue Heitkamp
Slide 9: Competitive strengths
Living (Residential and Property Development) 9 • Development of urban and rural areas in both small COMPANY PROFILE and large-scale projects • Combining creativity and customer focus with strength on realisation • Focus on complex renovations and transformations • Standardisation of concepts (e.g.
Slide 10: Living: Property Development
10 COMPANY PROFILE Living: Property Greenville – Leidsche Rijn Utrecht Development Property Development focuses on area development of both large and smaller-scale projects in urban and out-of-town areas. It fulfills the role of both initiator, developer and seller of (mainly) residential properties
Slide 11: Living: Residential
11 COMPANY PROFILE * As of 1/1/2018, Residential and Non Residential were brought under central management and the name was changed into Building & Technology Living: Residential Residential Building operates from five regions under central management. Its prime activity is new-build, but it also in
Slide 12: Working: Non Residential
12 COMPANY PROFILE * As of 1/1/2018, Residential and Non Residential were brought under central management and the name was changed into Building & Technology Working: Non Residential Non-Residential designs, creates and maintains high-quality electro-technical and mechanical installations (‘Service
Slide 13: Connecting: Infrastructure
13 COMPANY PROFILE Connecting: ASPHALT A1/A27 - UTRECHT Infrastructure Infra focuses on the construction, improvement and maintenance of the Dutch road infrastructure and public spaces, including related installations and on-site objects. This includes roads, viaducts, tunnels, locks, water treatmen
Slide 14: Strategy
WINTRACK II - TENNET WIND PARK WIERINGERMEER DRINKING WATER PIPELINE – LOOSBROEK Strategy 14
Slide 15: Strategy 2019 - 2023
15 Strategy 2019 - 2023 STRATEGY FROM TO VISION: SPACIAL CONTOURS OF STRATEGIC AGENDA BASED 8 STRATEGIC THEMES TRANSLATED TOMORROW ON 3 MAIN THEMES INTO OPERATIONAL KPI’S Developments within Heijmans • To build on ‘Focus, discipline, excellence’ strategy of 2018-2019 to further enhance risk manageme
Slide 16: Strategy 2019 – 2023: Better and Smarter
16 Strategy 2019 – 2023: STRATEGY “Better” and “Smarter” Strategic theme Bold statements Concrete goals We work safely or we do not We won't be satisfied until we have 0 accidents Safety work at all IF rate < 1 in 2020 Risk Management & All projects are predictable We complete the implementation of
Slide 17: Strategy 2019 – 2023: Sustainable
17 Strategy 2019 – 2023: STRATEGY “Sustainable” Strategic theme Bold statements Concrete goals Our production is CO2-neutral As of 2023, Heijmans is CO2-neutral. We offset any residual value Energy and we create energy-neutral In 2023, we can deliver 100% energy-neutral solutions for our solutions f
Slide 18: Asset management project images
ASSET MANAGEMENT TERNEUZEN LOCK WILHELMINA LOCK ZAANDAM N280 ROERMOND - INFRA BEATRIX LOCK PPP - NIEUWEGEIN
Slide 19: Strategy Property Development
19 STRATEGY Strategy Property Development Long term goal • Strong demographic growth fundamentals hampered by various regulatory issues that impact pipeline, Property Development: including designation of new development areas, changes in environmental law and private quality stable EBITDA- assuranc
Slide 20: Strategy Building & Technology
20 STRATEGY Strategy Building & Technology Long term goal: • As of 1/1/2018 Residential and Non Residential were brought under central management and stable EBITDA- merged into “Building & Technology”, with commercial focus based on core competencies: Margin of 4-5% › Services: armed with its instal
Slide 21: Strategy Infra
21 STRATEGY Strategy Infra Long term goal: • 2017 and 2018 were dominated by derisking of loss-making projects acquired in 2011-2015 stable EBITDA- Margin of 4-5% • 2019 was a stable year in which the turnover mix changed to targeted levels, but pipeline affected by nitrogen and PFAS issues • Large
Slide 22: Innovation project images
VAN GOGH – ROOSEGAARDE BICYCLE PATH COMPOSITE BRIDGE HYDROFIT SEWER RELINING Kousrelining (renovation of waterpipes) SOLAR NOISE BARRIER BIKESCOUT SOLAR GUARD RAIL RECOFLEX ASPHALT
Slide 23: Focus on innovation
Examples of innovations sold / ready for market launch: 23 • Heijmans ONE portable house > 135 houses now sold; STRATEGY • Hydrofit sewer relining > several projects realised; • BikeScout: warning system to improve safety of cyclists, implemented at several locations; • Smart living concept: standar
Slide 24: Environmental Social Corporate Governance
ZUIDERHAVEN, HARLINGEN Environmental Social Corporate Governance 24
Slide 25: ESG - rankings
25 ESG - rankings Ranking Institute Position / Score 1 Forrest50 FSC 2nd 2 Carbon disclosure CDP B 3 Transparency benchmark Ministry of Economic Affairs & Climate 12th 4 ISO 14001 Kiwa N/A 5 CO2- Performance ranking Kiwa Level 5 6 Score card EcoVadis EcoVadis Bronze medal 7 VCA Kiwa N/A 8 Sustainabi
Slide 26: Asset management and locks project images
ASSET MANAGEMENT TERNEUZEN LOCK WILHELMINA LOCK ZAANDAM BEATRIX LOCK PPP - NIEUWEGEIN
Slide 27: ESG policy Heijmans
27 ESG policy Heijmans • Digitalisation / Production technology: several initiatives to improve efficiency of materials and impact on environment • Energy: target to be CO2 neutral in 2023 • Materials: we aim for 100% circularity in 2023 • Space: our developments are green, blue and safe Key measure
Slide 28: ESG policy Heijmans
28 ESG policy Heijmans • Safety: With our GO! Programme we aim for IF rate < 1 • Process improvement: strong focus on performance measurement and customer satisfaction against clear targets • Quality of the organization: HR policy to bind, attract & retain employees. Programmes for trainees, and sen
Slide 29: ESG policy Heijmans
29 ESG policy Heijmans • Risk management & Process improvement › Full implementation of Corporate Governance Code, Compliance Office and Integrity commission › Strong lines of defense, including Internal Audit and Risk Office • Quality of the organization: Transparant interaction with stakeholders (
Slide 30: Dutch Construction Market
ZUIDASDOK – AMSTERDAM Dutch Construction Market 30
Slide 31: Nitrogen issue explained
DUTCH CONSTRUCTION MARKET 31 Nitrogen issue explained • NL: 166 designated ‘natura 2000’ areas: nature areas protected by European law • 118 with habitats sensible to nitrogen emissions • Until May, the “Program Approach Nitrogen” (PAS) allowed to include positive effects of future developments whil
Slide 32: Nitrogen: impact Heijmans
DUTCH CONSTRUCTION MARKET 32 Nitrogen: impact Heijmans • Technical solutions / innovations are being explored • Until now, no Heijmans projects in execution are cancelled / suspended • However, pipeline of projects is heavily impacted, difference between ‘tender market’ and projects outside the tend
Slide 33: PFAS issue explained
DUTCH CONSTRUCTION MARKET 33 PFAS issue explained PFAS is a family name for 6.000 material, including Pfos, Pfoa and GenX and is being used for decades in all kind of applications PFAS is strong, mobile (especially in water) and hardly degradable Hundreds of locations known in the Netherlands, with
Slide 34: Dutch market
34 • 2020-2021 outlook weakened throughout 2019 following DUTCH CONSTRUCTION MARKET impact of more strict norms for nitrogen disposition, heavily impacting a.o. agricultural and construction sector, and PFAS • As a result, growth of employment will come to an end in 2020-2021, as well as shortages o
Slide 35: Production volumes sector 2018-2024
DUTCH CONSTRUCTION MARKET 35 Production volumes sector 2018-2024 Forecast Q1 2020 – Pre Covid 19 Forecast Q2 2020 – Post Covid 19 2018 2019 2019 2020 2021 22-24* 2020 2021 22-24* in € millions Annual change (in percentages) Residential New build 13.025 13.375 2,5 -5 -5,5 7 -9 -13,5 14,5 Renovations
Slide 36: Dutch housing market
DUTCH CONSTRUCTION MARKET 36 Dutch housing market Average sales period (#days) of homes supply Average sales price houses (new built vs other) Supply of houses for sale has decreased sharply since 2014 and production of new built houses unable to meet strong demand … …as a result, house prices are S
Slide 37: Dutch housing market
DUTCH CONSTRUCTION MARKET 37 Dutch housing market Fundamentals have improved considerably since 2014 after 7 years of declining market: • Historically low interest rates, increased consumer confidence and government policies (limiting tax deductibility and revised social housing policy) have resulte
Slide 38: Heijmans H1 2020 results: Strong performance despite market challenges
NATIONAAL MILITAIR MUSEUM - SOESTERBERG “Heijmans H1 2020 results: Strong performance despite market challenges” Ton Hillen, CEO Heijmans N.V. Hans Janssen, CFO Heijmans N.V. 38 August 21, 2020
Slide 39: Safety
39 Safety Trendline number of injuries per month (incl. subcontracting Trendline Injury Frequency (IF)* (own staff incl. hires) and restricted workday) *IF = Injury Frequency = number of lost-time injuries in the last 12 months / number of hours worked in the last 12 months * 1.000.000 (Target: IF <
Slide 40: Highlights interim H1 results
40 Highlights interim H1 results • Revenue and underlying EBITDA more than 10% higher than last year • Order book remains healthy at € 2.0 billion • Strong cash position, credit facility unused • Home sales comparable with 2019 • Heijmans effectively absorbs impact of Covid-19 in H1, uncertain impac
Slide 41: Willemspoort North residential project image
ANDERE FOTO VAN FENIX I WILLEMSPOORT NORTH - RESIDENTIAL WILLEMSPOORT NOORD, ‘S-HERTOGENBOSCH
Slide 42: Property development
42 Property development: Property development ∆% x € 1 million H1 2020 H1 2019 2019 2020-2019 Revenues 224 206 459 9% Underlying EBITDA 14 11 26 Underlying EBITDA margin 6,3% 5,3% 5,7% Order book 492 451 454 • First half 2020 results were better than those in the first half of 2019 • Number of homes
Slide 43: Building & Technology: revenue growth, higher costs non-residential projects
43 Building & Technology: revenue growth, higher costs non- residential projects Building & Technology ∆% x € 1 million H1 2020 H1 2019 2019 2020-2019 Revenues - Residential 268 225 448 Revenues - Non-Residential 202 165 369 Revenues - Building & Technology 470 390 817 21% Underlying EBITDA - Buildi
Slide 44: Infra: delivers strong performance
44 Infra: delivers strong performance Infra ∆% x € 1 million H1 2020 H1 2019 2019 2020-2019 Revenues 310 297 619 4% Underlying EBITDA 17 13 30 Underlying EBITDA margin 5,5% 4,4% 4,8% Order book 704 773 791 • Well-filled order book • Additions primarily for short-cyclical works in the fields of maint
Slide 45: Outlook: confident for the full-year 2020
45 Outlook: confident for the full-year 2020 • Strong first half provides solid basis for the rest of 2020 • Healthy order book and progress on projects in all sectors • Performance at least equal to last year • Covid-19 situation and potential nitrogen emissions measures difficult to predict • The
Slide 46: Financing, Cash flow, Financial statements
KONINGSTUNNEL – THE HAGUE Financing, Cash flow, Financial statements 46
Slide 47: Cash flow and financing
47 Cash flow and financing • Net debt € 43 million (H1 2019: € 99 million), driven by positive result development and improved working capital • Working capital boosted by sustained strong pre-financing and rapid receivables collection • Solvency further improved to 26.9%. Robust balance sheet • Hei
Slide 48: Continued strong focus on debt reduction
48 Continued strong focus on debt reduction Omvang syndicaatslening versus gebruik syndicaatslening 220 • Heijmans continues to 200 reduce debt 180 160 140 • Average net debt improved 120 by more than € 40 million 100 80 year-on-year 60 40 20 • Credit facility remains 0 unused so far in 2020 -20 -40
Slide 49: Financing in place
49 In addition, several project financings in place in PPP and Financing in place Property Development, both recourse and non recourse, as well as several operational and financial leases Relevant details syndicated loan facility: The most significant financing arrangements include: - € 121 mln in s
Slide 50: Order Book
DE LEEUWENKUIL, ROTTERDAM 50 FINANCIAL STATEMENTS Order Book in € mln. 31-12-2019 30-06-2019 31-12-2018 Property development 454 451 435 Residential 506 493 508 Non-residential 762 731 694 Building & Technology 1.268 1.224 1.202 Infra 791 773 766 Eliminations -389 -357 -389 Total 2.124 2.091 2.014 O
Slide 51: Financial covenants
51 YTD June FY 2019 H1 2019 x € 1 million 2020 FINANCIAL STATEMENTS Reported Net debt 43,3 30,4 99,1 Adjustments: Corrections IFRS 16 -83,3 -86,6 -76,1 Net debt joint ventures 57,0 51,3 78,5 Net debt non recourse project financings -74,1 -79,6 -90,5 Cumulative preference shares B -41,8 -45,1 -45,1 O
Slide 52: Profit and loss H1 2020
H1 2020 H1 2019 2019 x € 1 million 52 FINANCIAL STATEMENTS Revenues 839 730 1.600 Property development 14 11 26 Building & Technology 14 15 30 Infra 17 13 30 Corporate -4 -3 -8 Underlying EBITDA 41 36 78 P&L Correction EBITDA joint ventures Write down on property assets 5 0 -3 0 -8 -5 Restructuring
Slide 53: Balance sheet
53 FINANCIAL STATEMENTS Balance sheet
Slide 54: Case studies
ELASTOCOAST - WADDENZEEDIJK Case studies 54
Slide 55: Project: HAGA / De Schoone Ley, Den Haag
PROJECT: HAGA / DE SCHOONE LEY, DEN HAAG SECTOR: PROPERTY DEVELOPMENT / RESIDENTIAL ORIGINAL CONTRACT SUM: € 92 MLN START: 2018 EXPECTED COMPLETION: 2020
Slide 56: Project: Vertical Amsterdam Sloterdijk
PROJECT: VERTICAL AMSTERDAM SLOTERDIJK PROJECT: SECTOR: PROPERTY NEW AMSTERDAM DEVELOPEMENT COURT HOUSE IN COMBINATION WITH SECTOR: BUILDING BUILDING & TECHNOLOGY & TECHNOLOGY > HIGH>RISE NONRESIDENTIAL RESIDENTIALBUILDINGS SERVICES ORIGINAL CONTRACT SUM: € 60 SIZE: MLN START: EARLYSTART: 2020 MAINT
Slide 57: Project: New Amsterdam Court House
PROJECT: NEW AMSTERDAM COURT HOUSE SECTOR: BUILDING & TECHNOLOGY > NON RESIDENTIAL PROJECTS ORIGINAL CONTRACT SUM: € 216 MLN (90% SHARE) START: 2016 NEW AMSTERDAM COMPLETION: 2020 (EXCL MULTI COURTPERIOD) YR MAINTENANCE HOUSE
Slide 58: Project: European Medicines Agency Amsterdam
PROJECT: EUROPEAN MEDICINES AGENCY AMSTERDAM SECTOR: BUILDING & TECHNOLOGY > NON RESIDENTIAL PROJECTS ORIGINAL CONTRACT SUM: € 190 MLN (50% SHARE) START: 2018 EUROPEAN COMPLETED: 2019 (EXCL MEDICINES AGENCY, AMSTERDAM MULTI YR MAINTENANCE PERIOD)
Slide 59: Project: Maintenance contract Paleis 't Loo
PROJECT: MAINTENANCE CONTRACT PALEIS T LOO SECTOR: BUILDING & TECHNOLOGY > NON RESIDENTIAL SERVICES ORIGINAL CONTRACT SUM: € 18 MLN START: 2018 MAINTENANCE CONTRACT ROYAL PALACE – ‘T2020 COMPLETION: LOO
Slide 60: Project: Aegon head office The Hague
PROJECT: AEGON HEAD OFFICE THE HAGUE PILOT BE SENSE DATA DRIVEN SERVICES SECTOR: BUILDING & TECHNOLOGY > NON RESIDENTIAL SERVICES ORIGINAL CONTRACT SUM: N/A START: 2017 COMPLETION: MULTI YEAR
Slide 61: One concept, Various applications
One concept, Various applications PROJECT: AEGON HEAD OFFICE THE HAGUE PILOT BE SENSE DATA DRIVEN SERVICES SECTOR: BUILDING & TECHNOLOGY > RESIDENTIAL SIZE: ROUGHLY 1.000 HOMES ANNUALLY START: N/A COMPLETION: N/A
Slide 62: Project: Several residential projects
CARMELFLATS - BEEK PROJECT: SEVERAL PROJECTS SECTOR: BUILDING & TECHNOLOGY > RESIDENTIAL SIZE: ROUGHLY € 50 MLN ANNUALLY START: N/A RENOVATION LEFIER - EMMEN COMPLETION: N/A
Slide 63: Project: IXAS / A9 Gaasperdammertunnel
PROJECT: IXAS / A9 GAASPERDAMMERTUNNEL SECTOR: INFRA > CENTRALISED PROJECTS ORIGINAL CONTRACT SUM: APPR. € 600 MLN (33,33% SHARE) START: 2015 COMPLETION: 2020 (EXL MULTI YEAR MAINTENANCE PERIOD)
Slide 64: Project: A1 Apeldoorn/Azelo
PROJECT: A1 APELDOORN/AZELO SECTOR: INFRA > CENTRALISED PROJECTS CONTRACT SUM: APPR. € 175 MLN (100% SHARE) START: 2019 COMPLETION: 2020
Slide 65: Project: Two projects for network operator Liander
PROJECT: TWO PROJECTS FOR NETWORK OPERATOR LIANDER SECTOR: INFRA > ASSET MANAGEMENT ORIGINAL CONTRACT PROJECT:SUM: IXAS APPR. € 120 MLN (100% SHARE) / A9 GAASPERDAMMERTUNNEL PROJECT 1: 10 YEAR SECTOR: MAINTENANCE INFRA AND PROJECTS > CENTRALISED UPGRADE ORIGINALCONTRACT CONTRACTFOR SUM:1.350 MEDIUM
Slide 66: Appendices
PROJECT: MAINCONTRACT SCHIPHOL MAINCONTRACT SCHIPHOL AIRPORT SECTOR: INFRA > ASSET MANAGEMENT ORIGINAL CONTRACT SUM: APPR. € 45 MLN ANNUALLY Appendices START: 2019 COMPLETION: 2028 66
Slide 67: Executive Board
67 Ton (A.G.J.) Hillen (1961), Member of the APPENDIX Executive Board as of 18 April 2012, Chairman of the Executive Board as of 1 December 2016. responsible for: General Affairs, Infrastructure, Property Development, Building & Technology, Innovation, HR / Management Development, Executive Board Pr
Slide 68: Impact IFRS 16 Leases as of 2019
68 APPENDIX Impact IFRS 16 Leases as of 2019 • Modified retrospective method applied, as a result, no comparable figures for 2018 • Balance sheet: lengthening due to recognition of operational leases and rental agreements • Except for: contracts shorter than 12 months / initial value < € 5.000 • P&L
Slide 69: Impact IFRS 16 Leases on 2019 P&L and opening balance sheet
Condensed consolidated balance sheet x € 1 million 69 Adjustment Impact IFRS 16 Leases on 2019 31 December 2018 1 January 2019 IFRS 16 Leases ASSETS Non-current assets P&L and opening balance Property, plant and equipment 44 44 Right-of-use assets - 79 79 Intangible assets 79 79 Joint ventures and a
Slide 70: Property development process
70 APPENDIX Property development process Process and timing unsold unsold unsold sold sold sold sold sold sold sold sold sold sold Obtaining Start Start sale Start building Delivery to consumer Land position Property development 70/80% pre-sold 1-6 years 1-2 years 3-6 months 1-2 years Revenues recog
Slide 71: Risk management approach
71 APPENDIX • ‘Best in class’ project reporting providing good insight on project opportunities as well as risks, specific issues, cash flow and progress; • Uniform risk classification for all projects into three categories. Direct involvement from Executive Board in large and complex Risk managemen
Slide 72: Towards one integrated ERP platform (SAP)
72 APPENDIX • Successful deployed to all employees and now implemented in all business segments • Proven project approach and timelines (Initiated in Towards one integrated ERP 2011, Blueprint Q4 2012, start roll-out 2013, implementation completed in 2018; platform (SAP) • Generic processes based up
Slide 73: IFRS % of completion method
73 APPENDIX IFRS % of completion method • Direct costing applied, i.e. the gross margin is recognized on the basis of the percentage of completion method. • In this method, 50% of the gross profit is recognized half way the project, and 100% at completion. • Suppose a EUR 100 mln with 10% gross marg
Slide 74: Project images in this handout
74 APPENDIX Project images in this handout Slide Project Locat ion Business Segment 4 Heijmans One Replaceable Residential 10 Greenville resp. Porseleinhaven Utrecht Leidsche Rijn resp. Loosdrecht Property Development / Residential 11 Cobana Rotterdam Property Development / Residential 12 Hart van Z
Slide 75: Contact details and disclaimer
75 CONTACT DETAILS HEIJMANS N.V. CONTACT: PO Box 2 Guido Peters 5240 BB Rosmalen, The Netherlands Investor Relations Heijmans www.heijmans.nl +31 73 543 5482 http://twitter.com/HeijmansNL gpeters@heijmans.nl DISCLAIMER This presentation has been prepared by and is the responsibility of Heijmans N.V.
Slide 76: Heijmans social media
heijmansnl @heijmansnl heijmans heijmansnl
Koninklijke Heijmans — Non-Deal Roadshow (September 2020) on 6ix