Arcadis Nv · EURONEXT:ARCAD
Arcadis Nv — FY2019 Earnings Presentation
25 slides from Arcadis Nv's earnings presentation, Feb 13, 2020
Slide 1: 2019 Q4 & FY Results: Sustained revenue growth and improved margin
Next generation thinking, sustainable delivery 2019 Q4 & FY Results Sustained revenue growth and improved margin Amsterdam, 13 February 2020 Peter Oosterveer (CEO) & Sarah Kuijlaars (CFO)
Slide 2: Sustained revenue growth and improved margin
FULL YEAR 2019 RESULTS Sustained revenue growth and improved margin • Continued growth on the back of megatrends urbanization, sustainability and digitalization; • 3% organic net revenue growth • 18% increase in operating EBITA to €209 million, margin improved to 8.1% (2018:7.3%) • Improvement areas
Slide 3: On track to achieve strategic targets
FULL YEAR 2019 RESULTS On track to achieve strategic targets Full year In € millions 1) 2019 2018 Change Gross revenues 3,473 3,256 7% Net Revenues Organic Growth % EBITDA 2,577 3% 235 2,440 204 6% 15% 3% Organic Net Revenue Growth EBITDA margin % 9.1% 8.4% Operation EBITA 2) 209 177 18% Operating E
Slide 4: Continued growth on the back of mega trends and actions taken
FULL YEAR 2019 RESULTS Continued growth on the back off mega trends and actions taken Total Net Revenue Key Markets Organic NR Operating DSO 84% of net revenues growth % EBITA % ▪ North America 16% ▪ Continental Europe ▪ The UK 4% 8.7% ( 8.7%) 79 (67) ▪ Australia ▪ CallisonRTKL 84% Improvement areas
Slide 5: Continued strong performance in key markets
FULL YEAR 2019 RESULTS Continued strong performance in key markets 4% 8.7%(8.7%) 79 (67) Organic NR % Operating EBITA DSO North America Continental Europe United Kingdom Australia CallisonRTKL ▪ Diligent implementation ▪ MEPC adherence ▪ Excellent foundation ▪ Focused execution of ▪ New leadership t
Slide 6: Improved results following actions identified last year
FULL YEAR 2019 RESULTS Improved results following actions identified last year -10% 7% (-3%) 200 (265) 1% 9% (5%) 135 (125) 16% 5% (-2%) 99 (120) Org. NR % DSO Org. NR % DSO Org. NR % DSO Op. EBITA Op. EBITA Op. EBITA Middle East Asia Latin America ▪ Selectivity towards specific services ▪ Leadershi
Slide 7: PFAS: innovation in remediation
FULL YEAR 2019 RESULTS PFAS: innovation in remediation PFAS are one of the world’s ▪ Multi-billion global market potential biggest emerging ▪ Arcadis addressable market; €500+ million gross contaminants revenues annually endangering humans & the environment ▪ Arcadis has significant expertise for >1
Slide 8: Arcadis Gen: digitally connect our clients with their built & natural assets
FULL YEAR 2019 RESULTS Arcadis Gen: digitally connect our clients with their built & natural assets ▪ Digitally focused, global entity, to accelerate Arcadis’ digital transformation and ▪ Sectors: Rail, Highways, Water, Energy, Aviation propositions to clients ▪ Footprint: UK, Europe, Australia, Nor
Slide 9: A 130-year heritage of sustainability-focused outcomes to clients
FULL YEAR 2019 RESULTS A 130-year heritage of sustainability-focused outcomes to clients ▪ Within the Arcadis project related activities, our Score from 70 to 73 contributions focus around five SDGs ▪ 79% of our net revenues have a positive Reduced carbon footprint by contribution to the 5 SDGs rele
Slide 10: Support in producing 4,000 Mega-watt renewable energy
IJMUIDEN, THE NETHERLANDS “IJMUIDEN VER” Support in producing 4,000 Mega-watt renewable energy 10
Slide 11: Sustained revenue growth and operating margin improvement
FULL YEAR 2019 RESULTS Sustained revenue growth and operating margin improvement Net Revenues and organic growth 1) Operating EBITA (margin) 1) € millions, % € millions, % 9.0% 10% 4% 5% 8.3% 09% 2% 2% 2% 3% 7.4% 7.2% 7.5% 7.6% 08% 07% 06% 05% 04% 53 60 03% 647 642 660 45 44 47 49 613 607 628 02% 01
Slide 12: Increase in Net Income from Operations and Dividend
FULL YEAR 2019 RESULTS Increase in Net Income from Operations and Dividend Full year In € millions 1) 2019 2018 Change EBITDA 235 204 15% Depreciation EBITA Amortization & impairment -46 189 -17 -43 162 -63 8% 17% -74% 15% EBITDA growth EBIT 172 98 75% Net finance expense -30 -27 10% Taxes on income
Slide 13: Cash flow held back by Oracle implementation in the U.S.
FULL YEAR 2019 RESULTS Cash flow held back by Oracle implementation in the U.S. Full year In € millions 1) 2019 2018 EBITDA 235 204 ▪ Return to normalized working capital levels after Changes in net working capital -85 31 Oracle implementation U.S. takes more time than Changes in other working capit
Slide 14: Return to normalized working capital levels in due course
FULL YEAR 2019 RESULTS Return to normalized working capital levels in due course € millions Dec-18 % of GR* Sep-19 % of GR* Dec-19 % of GR* Gross receivables 643 524 662 ▪ Progress made in Q4 in North America: Provisions -61 -58 -60 ▪ Trade receivables normalized Provisions % 10% 11% 9% Trade receiv
Slide 15: Continued strengthening of the balance sheet
FULL YEAR 2019 RESULTS Continued strengthening of the balance sheet EBITDA Margin 1) Free Cash Flow 1) € millions, % € millions 8.8% 9.5% 10% 8.5% 8.2% 8.5% 7.9% 09% 08% 07% 06% 05% 149 123 04% 98 97 104 112 03% 100 100 100 02% 8 01% 00% -6 H1’17 H2’17 H1’18 H2’18 H1’19 H2’19 FY’17 H1’18 FY’18 H1’19
Slide 16: Americas: best results since 2015
FULL YEAR 2019 RESULTS Americas: best results since 2015 Full year 1) 33% of net revenues 2019 2018 change Gross revenues 1,394 1,186 18% Net Revenues 860 755 14% Organic Growth % 9% Operating EBITA 70.5 54.9 28% Operating EBITA margin 8.2% 7.3% Fourth quarter 2019 2018 change Gross revenues 390 334
Slide 17: Europe & Middle East: strong fourth quarter in all regions
FULL YEAR 2019 RESULTS Europe & Middle East: strong fourth quarter in all regions Full year 1) 44% of net revenues 2019 2018 change Gross revenues 1,390 1,392 0% Net Revenues 1,145 1,133 1% Organic Growth % 1% Operating EBITA 87.0 77.4 12% Operating EBITA margin 7.6% 6.8% Fourth quarter 2019 2018 ch
Slide 18: Asia Pacific: step change in operating margin
FULL YEAR 2019 RESULTS Asia Pacific: step change in operating margin Full year 1) 14% of net revenues 2019 2018 change Gross revenues 388 375 3% Net Revenues 350 331 6% Organic Growth % 3% Operating EBITA 34.9 25.4 37% Operating EBITA margin 10.0% 7.7% Fourth quarter 2019 2018 change Gross revenues
Slide 19: CallisonRTKL: invest in turnaround
FULL YEAR 2019 RESULTS CallisonRTKL: invest in turnaround Full year 1) 9% of net revenues 2019 2018 change Gross revenues 301 301 0% Net Revenues 222 220 1% Organic Growth % -5% Operating EBITA 17.0 19.4 -13% Operating EBITA margin 7.6% 8.8% Fourth quarter 2019 2018 change Gross revenues 73 81 -10%
Slide 20: Margin improvement and balance sheet strengthening
FULL YEAR 2019 RESULTS Margin improvement and balance sheet strengthening Operating EBITA (margin) DRO (days) and Net Working Capital % € millions, % € millions, % 8.1% 17.5% 16.9% 7.6% 16.6% 7.3% 15.1% 7.1% 209 91 88 88 176 186 177 80 2,0% 5,0% 2016 2017 2018 2019 2016 2017 2018 2019 Free Cash Flow
Slide 21: Increasing Capacity Port Of Antwerp using 3D visualization
ANTWERP, BELGIUM Increasing Capacity Port Of Antwerp using 3D visualization
Slide 22: Delivery on our strategic priorities
FULL YEAR 2019 RESULTS Delivery on our strategic priorities Strategic priorities Proof points 2019 ▪ People First resulting in improved voluntary turnover to 13.5% (2018: 15.6%) People & ▪ Creating a culture with a growth mindset and a disciplined focus on the right clients, Culture predictable proj
Slide 23: On track to achieve our targets set for 2020
FULL YEAR 2019 RESULTS On track to achieve our targets set for 2020 ▪ Growing market opportunities driven by global trends ▪ Urbanization, sustainability, globalization and digitalization ▪ Our digital agenda creates more opportunities for new business and better returns ▪ Significant legacy issues
Slide 24: Improving quality of life
PARCADIS | sz” for natural and built assets:
Slide 25: IFRS 16 impact
FULL YEAR 2019 RESULTS IFRS 16 impact P&L impact 2019 FY IAS 17 IFRS 16 Delta Balance sheet impact 2019 IAS 17 IFRS 16 Delta Gross revenues 3,473 3,473 - Net debt 310 601 +291 Net revenues 2,577 2,577 - Assets: right of use assets 0 267 +267 EBITDA 235 309 74 Liabilities: lease liabilities 0 291 +29