Koninklijke Heijmans N.v. · EURONEXT:HEIJM
Koninklijke Heijmans — Heijmans — Non-Deal Roadshow (March 2017)
64 slides from Koninklijke Heijmans's roadshow presentation, March 2017
Slide 1: Heijmans – Business Update
Heijmans – Business Update New Amsterdam Court House, Amsterdam March 2017, based on 2016 annual results
Slide 2: RIVM & CBG, Utrecht
RIVM & CBG, Utrecht 2
Slide 3: Contents
Contents • Company profile 4- 8 • Strategy 9 - 15 • Highlights 2016 Interim results 16 - 21 • Developments per sector 22 - 39 • Outlook 40 - 41 • Financial statements 42 - 45 • Annexes 46 - 60 Ø Resumes Executive Board 49 Ø Order book 51 Ø Financing & Financial Covenants 52-53 Ø Property development
Slide 4: Company profile
Company profile Founded in 1923 by Jan Heijmans Highway Tilburg - Den Bosch (anno 1928) 4
Slide 5: Heijmans History
Company profile Heijmans History • Since 1923 active in road building • Strong growth following second world war • During sixties, diversification towards residential building • During eighties, diversification towards property development • Listing at the Amsterdam Stock Exchange in 1993 • Strong r
Slide 6: Residential, Non-residential, Infrastructure
Company profile Residential Non-residential Infrastructure Property development Building Road building Residential building Technical Services Civil Engineering Eemskwartier Groningen Baggage hall Eindhoven Airport N23 Westfrisiaweg, Province of North Holland 6 6 Meysters’ Buiten, Utrecht Technical
Slide 7: Heijmans at a glance
Company profile Heijmans at a glance • With 6,241 employees and approx. € 1.9 billion in 2016 revenues, Heijmans is active in property development, residential building, non-residential and infrastructure; • Active in selective markets in the Netherlands, Belgium and Germany; • Revised strategy will
Slide 8: Key figures
Key figures x 1 € million H2 2016 H2 2015 2016 2015 Revenues 938 1.057 1.884 1.979 Underlying operating result ** -59 6 -66 -5 Operating result -79 -13 -94 -29 Result after tax -98 12 -110 -27 Earnings per share ( in €) -4,59 -0,56 -5,16 -1,32 Order book 1.863 1.669 1.863 1.669 Net debt 100 10 100 1
Slide 9: Strategy – Restructuring provides potential
Strategy – Restructuring provides potential Since 2009, Heijmans has implemented a transformational strategic restructuring: • Focus on core activities in the Netherlands • Disposal of all foreign operations • Reduction in strategic land bank positions • Margin over volume ~ added value • Streamline
Slide 10: A27 / A1 PPP Utrecht - Eemnes
A27 / A1 PPP Utrecht - Eemnes 10
Slide 11: Strategic adjustment: 2017 - 2019 Focus, Discipline, Excellence
Strategic adjustment: 2017 - 2019 Focus, Discipline, Excellence • Dutch core company, revenues approx. € 1,5 billion, with positive results; • Disposal of German and Belgian entities; • Selective acquisition based on core competencies per segment; • Large/complex projects in partnerships; • Optimisi
Slide 12: National Military Museum (PPP), Soesterberg
National Military Museum (PPP), Soesterberg 12
Slide 13: Strategy – Competitive strengths
Strategy – Competitive strengths Residential • Development of urban and rural areas in both small and large-scale projects • Combining creativity and customer focus with strength on realization • Increasing focus on renovations and transformations • Improving processes including procurement, 3D BIM
Slide 14: Infra technology & mobility innovations
Kousrelining (renovation of waterpipes) Infrastructure for Electric cars Composite bridge Infra technology & mobility 14
Slide 15: Strategy – Innovation
Strategy – Innovation Investing in smart technological concepts / sustainable solutions: • Creating competitive advantage towards clients; • Improving future margin potential because of increased added value and focus on marketability; • Cooperation with SPARK (network for creativity and knowledge).
Slide 16: Highlights 2016
Highlights 2016 “Heijmans: annual results 2016, adjustment strategy and new financing agreements” Underlying operating result x € 1 million H2 2016 H1 2016 2016 2015 Property development 9 6 15 9 Residential 2 2 4 5 Non-residential -15 0 -15 0 Infra -63 -15 -78 -26 Netherlands -67 -7 -74 -12 Belgium
Slide 17: Highlights 2016
Highlights 2016 • Revenues 2016 € 1.9 billion (2015: € 2 billion), excl Belgium / Germany € 1.43 billion; • Growth in the number of homes sold to 1,962 homes (2015: 1,791 homes); • Significant impact project losses € 90 million, significant improvement risk profile; • Underlying operating result 201
Slide 18: Financial settlement and ringfencing of loss-making projects
Financial settlement and ringfencing of loss-making projects • Total impact 2016 nearly € 90 mln; • Infra: approx. € 75 mln; • Non-Residential: approx. € 15 mln; • Drachtsterweg Leeuwarden: new agreements Q2 2016, loss 2016: € 6 mln; • Energiefabriek Tilburg: contract termination per 1-12-2016, loss
Slide 19: Short-term measures
Short-term measures • Risk profile loss-making projects reduced, effective completion • Strategy adjusted and implementation started: focus fully on Dutch market ‘Focus, Discipline, Excellence’ • Tightened focus on core competencies • Selection of projects: core competencies, margin and risk profile
Slide 20: Strategic adjustment per sector
Strategic adjustment per sector Property Development and Residential Building • Growth from solid fundamentals, in margin and volume • Accelerating property developments leads to further debt reduction • Combination: suburban areas and inner-city developments – new-build and transformation/renovatio
Slide 21: Strategic adjustment per sector
Strategic adjustment per sector Non-Residential • Commercial focus and selective acquisition based on core competencies • Expand market share Services, growth in volume and margin • Growing importance of concepts and process standardisation • Intensifying collaboration with Property Development on t
Slide 22: Hart van Zuid PPP Rotterdam
Hart van Zuid PPP Rotterdam 22
Slide 23: Developments per sector: Property Development
x € 1 million H2 2016 H1 2016 2016 2015 DEVELOPMENTS PER SECTOR Revenues 162 170 332 278 Underlying operating result 9 6 15 9 PROPERTY DEVELOPMENT Underlying operating margin Order book 5,6% 311 3,5% 275 4,5% 311 3,2% 284 • Turnover growth continues (almost 20%) with positive development operating r
Slide 24: Dutch Real estate market
Dutch Real estate market Fundamentals have improved considerably since 2014 after 7 years of declining market: • In 2007, approx. 80K houses were built, a number that more than halved in 2013/2014; • The Netherlands: approx. 17 mln inhabitants with 7,5 mln households; • CBS: # households to increase
Slide 25: Property Development
PROPERTY DEVELOPMENT Strategic positions 31-12-2016 31-12-2015 31-12-2014 (in millions euro) Brabant & Gelderland 3 3 4 Northern provinces 9 14 17 Randstad area 22 25 30 Southern provinces 3 3 3 Totals 38 45 54 Land in exploitation 31-12-2015 31-12-2014 (in millions euro) Brabant & Gelderland 53 57
Slide 26: Herbestemming Grootlab, Kanaleneiland
Herbestemming Grootlab Kanaleneiland Amsterdamse Hogeschool Utrecht voor de Kunsten 26
Slide 27: Developments per sector: Residential
x € 1 million H2 2016 H1 2016 2016 2015 DEVELOPMENTS PER SECTOR Revenues 144 152 296 295 Underlying operating result 2 2 4 5 RESIDENTIAL Underlying operating margin Order book 1,4% 327 1,3% 277 1,4% 327 1,7% 286 • Turnover and result comparable with 2015; • Pressure on capacity through strong demand
Slide 28: Onderhoud en beheer ministeries, Lounge Schiphol
Onderhoud en beheer ministeries Lounge 2 Veiligheid en Schiphol Amsterdam Justitie, Binnenlandse Zaken en Koninkrijksrelaties 28
Slide 29: Developments per sector: Non-Residential
x € 1 million H1 2016 2015 DEVELOPMENTS PER SECTOR Revenues H2 2016 153 162 2016 315 421 Underlying operating result -15 0 -15 0 NON-RESIDENTIAL Underlying operating margin -9,8% 0,0% -4,8% 0,0% Order book 758 825 758 517 • Turnover decreased as RIVM project delayed, as well as selective tender proc
Slide 30: A9 Gaasperdammerweg Amsterdam, A12
A12 A9 Gaasperdammerweg Veenendaal – Ede - Grijsoord Amsterdam 30
Slide 31: Developments per sector: Infrastructure Netherlands
x € 1 million H2 2016 H1 2016 2016 2015 DEVELOPMENTS PER SECTOR Revenues 292 329 621 690 Underlying operating result -63 -15 -78 -26 Underlying operating margin -21,6% -4,6% -12,6% -3,8% INFRASTRUCTURE NETHERLANDS Order book 730 787 730 834 • Turnover decreased as a result of stagnation in and decom
Slide 32: Wintrack II TenneT
Wintrack II TenneT 32
Slide 33: Improving control of large projects
Improving control of large projects Market Tendering / More risks to contractors / Acquisition many competitors Risk and cost price assessment Background of issues Execution & Contract Organisation Management Focus Tender management Suitable Partnerships Design costs Improvement measures Market visi
Slide 34: Wilhelminakanaal, Tilburg
Wilhelminakanaal, Tilburg 34
Slide 35: Strategy plan Infra Netherlands 2016 - 2019
Strategy plan Infra Netherlands 2016 - 2019 • New board member appointed early 2016 with specific focus on Infra • Strategy Dutch infrastructure redefined mid 2016 • Plan consists of 5 key elements for 2016 -2019: 1) Intensively managing and completing of current loss making projects 2) Improving ri
Slide 36: Elisabeth Center Antwerpen (B)
Elisabeth Center Antwerpen (B) 36
Slide 37: Developments per sector: Belgium
x € 1 million H2 2016 H1 2016 2016 2015 DEVELOPMENTS PER SECTOR Revenues 116 114 230 208 Underlying operating result 3 4 7 8 BELGIUM Underlying operating margin 2,6% 3,5% 3,0% 3,8% Order book 259 251 259 270 • Continuing strong performance of Van den Berg, taking advantage of niche segmentation; • M
Slide 38: Oevermann Erpho-Bogen Münster (D)
Oevermann Erpho-Bogen Münster (D) 38
Slide 39: Developments per sector: Germany
x € 1 million H2 2016 H1 2016 2016 2015 DEVELOPMENTS PER SECTOR Revenues 158 126 284 319 Underlying operating result 10 3 13 7 GERMANY Underlying operating margin 6,3% 2,4% 4,6% 2,2% Order book 183 178 183 155 • Strong result in 2016 within Oevermann (5% EBIT margin), especially in H2; • Turnover an
Slide 40: Wijnhavenkwartier Den Haag
Wijnhavenkwartier Den Haag
Slide 41: Outlook
Outlook • Extension of financing and ringfencing of loss making projects offers strong foundation for continuity; • 2017 year of transition: • Shaping of proposed divestments; • Therewith: improving capital ratios; • Positioning of Dutch core company, with suitable cost base; • Above all: working to
Slide 42: Balance sheet (condensed)
Balance sheet (condensed) 31 December 30 June 31 December x € 1 million 2016 2016 2015 Fixed assets 291 374 380 Working capital (excl. cash and cash equivalents) -55 -20 -72 Netto assets held for sale 67 - - Capital invested 303 354 308 Equity 142 245 266 Provisions (non-current) 15 32 32 Net debt 1
Slide 43: Balance sheet (extended)
Balance sheet (extended) (x € 1 million) 31 December 2016 31 December 2015 Non-current assets Property, plant and equipment 55 90 Intangible assets 82 112 Share in joint ventures and associates 66 77 Other fixed assets 88 101 291 380 Current assets Strategic land portfolio 147 172 Other inventory 70
Slide 44: P&L (per sector)
P&L (per sector) H2 Full Year Actual Actual (in million €) Actual Actual 2016 2015 2016 2015 Revenues EBIT Revenues EBIT Revenues EBIT Revenues EBIT 163 8 152 5 Property Development 332 15 278 9 145 2 137 2 Residential - Netherlands 296 4 295 5 54 0 46 1 Residential - Belgium 110 0 92 1 198 2 183 3
Slide 45: Cash Flow Statement
Cash Flow Statement indirect method 2016 2015 (x € 1 million) Operating result -94 -29 Loss on sale of assets held for sale 6 - Gain on sale of non-current assets and property investments -1 -2 Depreciation and impairment of property, plant and equipment 17 18 Amortisation of intangible assets 2 2 I
Slide 46: Spaarndammerbuurt, Amsterdam
Spaarndammerbuurt, Amsterdam 46
Slide 47: Appendices
Appendices
Slide 48: Timmerhuis, Rotterdam
Timmerhuis, Rotterdam 48
Slide 49: Annex: Executive Board
Annex: Executive Board Ton Hillen (1961), CEO & chairman of the Executive Board responsible for: General Affairs, Management Development / HR, Investor Relations & Communication, Commerce, Innovation, Property Development, Residential Building, Non-Residential, PPP Ruud Majenburg (1959), COO & membe
Slide 50: Maintenance Ministries, The Hague
Maintenance Ministries, The Hague 50
Slide 51: Order book
Order book Order book (x € 1 million) 31-12-2016 30-6-2016 31-12-2015 Property development 311 275 284 Residential 327 277 286 Non-residential 758 825 517 Infra 730 787 834 Eliminations -263 -216 -252 Netherlands 1.863 1.948 1.669 Belgium 259 251 270 Germany 183 178 155 Total order book 2.305 2.377
Slide 52: Financing
Financing • Duration until 30 June 2019; • Credit facility reduced in phases to € 122 mln (30 June 2019), in line with new scope; • Divestment foreign companies: debt reduction; • No covenant testing Q4 2016 and Q1 2017; • Q2, Q3, Q4 2017: customised covenants, testing minimum levels EBITDA and solv
Slide 53: Covenants
Covenants Amounts x € 1 million Interest bearing debt 2016 FY 178,3 2016 MY 322,8 2015 FY 135,1 Minus: cash and cash equivalents 78,3 245,3 125,4 Net debt 100,1 77,5 9,7 • Waiver agreed for Q4 / Adjustments: 2016 financial covenants Net debt Joint Ventures 84,7 80,8 75,5 Net debt non recourse projec
Slide 54: Heijmans ONE, First houses sold and placed in Limburg
Heijmans ONE, First houses sold and placed in Limburg 54
Slide 55: Annex: Property development process
Annex: Property development process Process and timing unsold unsold unsold sold PROJECT sold sold sold sold sold sold sold sold sold PROCESS 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 Rev
Slide 56: Fenix Lofts, Rotterdam Katendrecht
Fenix Lofts, Rotterdam Katendrecht 56
Slide 57: Annex: Risk Management approach
Annex: Risk Management approach Policies and corporate philosophy gradually developed and implemented as from mid 2008: • Compact set-up with direct reporting to Executive • Uniform risk classification for all projects into three management; categories. Direct involvement from Executive Board • Cent
Slide 58: Franki Hammer Strasse, Hamburg (D)
Franki Hammer Strasse, Hamburg (D) 58
Slide 59: Annex: IFRS % of completion method
Annex: IFRS % of completion method Progress production 100% • 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 50% 100% at completion. • Suppose a EUR 100
Slide 60: A12 Parallelstructuur Gouda
A12 Parallelstructuur Gouda 60
Slide 61: Implementation new ERP Platform
Implementation new ERP Platform Objectives Key changes: 1. Strengthen Control Integrated system 2. Integrate Procurement Centralized data management 3. Improve efficiency in back office processes Data entry at source (orders,hours) Three way match, digital invoicing AP • Successful deployed to +/- 4
Slide 62: 1000th Heijmans own label (Huismerk) home
1000th Heijmans own label (Huismerk) home Grauwaart Leidsche Rijn, Utrecht 62
Slide 63: Project images in this handout
Project images in this handout Slide Project Location Segment Front New Amsterdam Court House PPP Amsterdam Non Residential 2 RIVM Project Utrecht Non Residential 6 Eemskwartier Groningen Property Development 6 Meijster’s Buiten Utrecht Property Development 6 Baggage Hall Eindhoven Airport Non-resid
Slide 64: Disclaimer
Disclaimer This presentation has been prepared by and is the responsibility of Heijmans N.V. This presentation is being supplied to you solely for your information and use. The information may not be further distributed or passed on to other people or published or reproduced in whole or in part. The