Earnings Release • Feb 28, 2013
Earnings Release
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| In million € | 2012 | 2011 | 2012/2011 variation |
|---|---|---|---|
| Revenue | 1,898.3 | 1,793.8 | +5.8% |
| EBITDA | 199.1 | 181.7 | +9.6% |
| % of revenue | 10.5% | 10.1% | |
| Operating income | 81.4 | 84.9 | -4.1% |
| % of revenue | 4.3% | 4.7% | |
| Net result part of the group | 49.1 | 59.1 | -16.9% |
| % of revenue | 2.6% | 3.3% | |
| Earnings per share (in €) | 3.75 | 4.51 | |
| Gross dividend per share (in €) | 1.15 | 1.15 | |
| Net financial debt | 400.0 | 350.8 | |
| Order book at 31 December | 2,868.2 | 2,382.3 | +20.4% |
******
CFE's board of directors met on 27 February 2013. The board finalised the financial statements for the year ended 31 December 2012, which will be submitted to shareholders for approval in the 2 May 2013 shareholders' meeting.
| As of December 31 | % variation | ||
|---|---|---|---|
| In million € | 2012 | 2011 | |
| Contracting | 900.8 | 897.1 | +0.4% |
| -Construction | 645.2 | 655.5 | -1.6% |
| -Rail & Road | 99.3 | 91.8 | +8.2% |
| -Multitechnics | 156.3 | 149.8 | +4.3% |
| Real Estate & Management Services | 35.0 | 26.0 | n.s. |
| Dredging & Environment | 957.5 | 882.9 | +8.4% |
| PPP-Concessions | 11.7 | 2.9 | n.s. |
| Holding and consolidation | -6.7 | -15.2 | n.s. |
| adjustments | |||
| Total | 1,898.3 | 1,793.8 | +5.8% |
| As of December 31 | % variation | ||
|---|---|---|---|
| In million € | 2012 | 2011 | |
| Contracting | +5.0 | +12.5 | -60.0% |
| -Construction | -2.5 | +3.2 | - |
| -Rail & Road | +5.7 | +4.6 | +23.9% |
| -Multitechnics | +1.8 | +4.7 | -61.7% |
| Real Estate & Management Services | +10.4 | +9.4 | +10.6% |
| Dredging & Environment | +69.1 | +67.6 | +2.1% |
| PPP-Concessions | +3.7 | -2.2 | - |
| Holding and consolidation | -6.8 | -2.3 | - |
| adjustments | |||
| Total | +81.4 | +84.9 | -4.1% |
| As of December 31 | % variation | ||
|---|---|---|---|
| In million € | 2012 | 2011 | |
| Contracting | +3.6 | +5.2 | -30.8% |
| -Construction | -1.3 | -0.6 | - |
| -Rail & Road | +4.0 | +3.6 | +11.1% |
| -Multitechnics | +0.9 | +2.2 | -59.1% |
| Real Estate & Management Services | +5.7 | +6.3 | -9.5% |
| Dredging & Environment | +43.3 | +51.0 | -15.1% |
| PPP-Concessions | +3.1 | -1.9 | - |
| Holding and consolidation | -6.6 | -1.6 | - |
| adjustments | |||
| Total | +49.1 | +59.1 | -16.9% |
| As of December 31 | % variation | ||
|---|---|---|---|
| In million € | 2012 | 2011 | |
| Contracting | 1,195.6 | 1,171.9 | +2.0% |
| -Construction | 964.2 | 983.2 | -1.9% |
| -Rail & Road | 65.8 | 76.0 | -13.4% |
| -Multitechnics | 165.6 | 112.7 | +46.9% |
| Real Estate & Management Services | 14.1 | 8.4 | n.s. |
| Dredging & Environment | 1,658.5 | 1,202.0 | +38.0% |
| PPP-Concessions | - | - | - |
| Holding and consolidation | - | - | - |
| adjustments | |||
| Total | 2,868.2 | 2,382.3 | +20.4% |
Consolidated revenue was €1.898 million on 31 December 2012 representing a 5.8% increase relative to 31 December 2011 (4.9% on a comparable structure basis).
Contracting revenue rose by 0.4% (-1.6% on a comparable structure basis) to €900.8 million, with €645.2 million from construction, €99.3 million from rail & road and €156.3 million from multitechnics.
Revenue from real estate & management services increased, with ongoing firm performance in terms of both business activity and sales.
Dredging & environment revenue rose by 8.4% to €957.5 million (CFE share).
Order intake on 31 December 2012 totalled €2,385 million, including €925 million in contracting and €1,414 million in dredging & environment.
The order book ended the year at €2,868.2 million, up 20.4% relative to 31 December 2011. This growth was driven mainly by dredging & environment, which posted a 38% increase.
Operating income amounted to €81.4 million, down 4.1% relative to 31 December 2011. This decrease was mainly the result of the construction and multitechnics activities. Real estate & management services, PPP-concessions and rail & road posted good earnings, higher than in 2011. The dredging business had a difficult first halfyear impacted by depreciation charges but improved as the year progressed.
Net income part of the group amounted to €49.1 million versus €59.1 million on 31 December 2011.
| In million € | 2012 | 2011 | % variation |
|---|---|---|---|
| Civil Engineering | 138.5 | 192.2 | -27.9 % |
| Buildings, Benelux | 432.7 | 354.1 | +22.2 % |
| Buildings, International | 74.0 | 109.2 | -32.2 % |
| Total | 645.2 | 655.5 | -1.6% |
Revenue fell slightly in 2012. However, evolutions are quite different within the division:
Major contracts won four years ago are gradually coming to an end.
| In million € | As of December 31 2012 |
As of December 31 2011 |
Variation en % |
|---|---|---|---|
| Civil Engineering | 190.6 | 233.5 | -18.4% |
| Buildings, Benelux | 527.8 | 607.9 | -13.2% |
| Buildings, International | 245.8 | 141.8 | +73.3% |
| Total | 964.2 | 983.2 | -1.9% |
The main trends were as follows:
The division's operating income turned negative (€-2.5 million). There were losses totalling €13 million at BAGECI and CFE Poland as well as in Qatar.
Problems with various projects and business levels that were too low to cover overheads prompted CFE to implement major restructuring measures in these entities at the end of the first halfyear.
Results from other companies were generally satisfactory following positive developments in certain matters.
Arbitration proceedings initiated at the request of a client in relation to a major Dutch project, came to an end. The parties adopted a new deadline to reach a balanced, definitive agreement in the first halfyear of 2013.
The division made a net loss of €-1.3 million versus €-0.6 million in 2011.
In early 2012, CFE set up its new rail & road division. This division includes the activities of ENGEMA (installation of overhead contact lines and rail signalling) and Louis Stevens & Co (rail signalling)- previously included in the multitechnics division- along with the road business of Aannemingen Van Wellen, and the activities of specialist track-layer Remacom, which was acquired at the start of the year.
The Rail & Road division's revenue grew by 8.2% (2.4% at constant scope) to €99.3 million. There was organic growth at ENGEMA and Louis Stevens & Co, while revenue in the Road business was comparable to the 2011 figure.
The order book ended the year at €65.8 million, down 13.4% relative to 31 December 2011 (-18.8% at constant scope). The outlook remains positive, since some large contracts are currently out to tender.
Operating income was €5.7 million versus €4.6 million in 2011 due to Remacom entering the scope of consolidation. In general, all of the division's companies posted satisfactory earnings.
Net income was €4 million, slightly higher than the 2011 despite a higher tax charge.
The multitechnics division generated revenue of €156.3 million, up 4.3% relative to the previous year (-4% at constant scope). International revenue increased -supported by VMA, which won contracts from major carmakers in Turkey, Poland and Hungary- while revenue fell slightly in Belgium.
The order book totalled €165.6 at end-2012, up 46.9% relative to 31 December 2011. The order book grew strongly at almost all subsidiaries, particularly CFE EcoTech due to orders in Vietnam and Sri Lanka, VMA -following further international expansion- Nizet Entreprise and Druart.
Although most subsidiaries posted satisfactory operating income, the divisional total fell to €1.8 million from €4.7 million in 2011. This temporary decline was due solely to a one-off loss at a subsidiary in western Flanders. The necessary restructuring measures have been taken.
Taking into account the financial result, tax and non-controlling interests, net income was €0.9 million, versus €2.2 million in 2011.
Despite a temporary dip in sales at the end of the first quarter, 2012 was an excellent year in terms of property sales and revenue amounted to €35 million (€26 million in 2011).
The value of real estate projects developed as follows:
Value of real estate projects
| In million € | As of December 31 2012 |
As of December 31 2011 |
|---|---|---|
| Properties at the marketing stage |
19 | 9 |
| Properties at the construction stage |
45 | 54 |
| Properties at the development stage |
102 | 68 |
| Total | 166 | 131 |
Although the value of properties at the marketing stage was boosted by the completion of a building at the end of the year, the total remains low (11%), reflecting the group's successful marketing policy.
The value of properties at the construction stage fell because of the aforementioned completion. Construction is fully underway on the Brusilia and Van Maerlant residential projects.
Properties at the development stage increased substantially due to the acquisition, in partnership with another developer, of the very well located Solvay site in Brussels, along with the acquisition of a stake in the Bavière project in Liège.
Operating income increased in 2012 to €10.4 million (€9.4 million in 2011).
Net income fell slightly because of heavier financial expenses caused by the higher level of properties at the construction and development stages. It totalled €5.7 million, versus €6.3 million in 2011.
(The amounts stated in this section relating to DEME are at 100%, whereas CFE owns 50% of the company).
DEME generated revenue of €1,915 million, up 8.4% relative to the previous year (€1,766 million).
| % | 2012 | 2011 |
|---|---|---|
| Capital dredging | 51% | 49% |
| Maintenance dredging | 14% | 16% |
| Fallpipe et landfalls | 11% | 12% |
| Environment | 10% | 11% |
| Marine works | 14% | 12% |
| Total (in million €) | 1,915 | 1,766 |
| % | 2012 | 2011 |
|---|---|---|
| Europe (EU) | 45% | 52% |
| Europe (non-EU) | 4% | 8% |
| Africa | 12% | 11% |
| Americas | 9% | 10% |
| Asia-Pacific | 20% | 11% |
| Middle East | 8% | 5% |
| India and Pakistan | 2% | 3% |
| Total (in million €) | 1,915 | 1,766 |
DEME's order book grew strongly (by 38%) to €3,317 million versus €2,404 million at 31 December 2011.
The increase was the result of winning three large contracts in the first half of the year. In Australia, DEME won the contract to dredge the approach channel, the manoeuvring area and the berths for the Wheatstone LNG project. In Qatar, DEME's Medco subsidiary -in which it owns a 44% stake- won the contract of the new port, reclaim 4.5km² of land and build two breakwaters using rock placement techniques. In the North Sea, DEME signed a contract with Northwind for the construction and installation of foundations for a wind-power project off the Belgian coast.
Fleet utilisation fell in the first part of 2012, with some dredgers undergoing major maintenance and repair work, while depreciation was higher following the delivery of new dredgers. However, business in the second part of the year enabled DEME to achieve firm operating income, higher than the 2011 figure, due to a satisfactory fleet utilisation rate.
EBITDA rose by 17.4% to €350.1 million versus €298.3 million in 2011. Operating income was €140.4 million (€137.3 million in 2011).
Net income fell as a result of higher financial expenses and totalled €89.4 million (€104.2 million in 2011).
In 2012, DEME completed its 2008-2012 investment plan by launching seven large new vessels:
DEME's net financial debt at end-2012 was €742 million after the aforementioned investment plan, versus €651 million at end-2011.
In early 2013, DEME carried out a €200 million bond issue. The proceeds are intended to refinance some of DEME's existing debt, while diversifying the company's financing sources. The issue was fully subscribed.
Through one of its subsidiaries and in conjunction with other Otary shareholders, DEME won new concessions for three North Sea wind-power projects off the coast of Belgium (Rentel, Seastar and Mermaid) with combined capacity of 900MW.
Revenue totalled €11.7 million (€2.9 million in 2011), supported by 45% -owned subsidiary Rent-A-Port, whose Vietnam project saw good progress. CFE's own business still consists partly of studies. Projects relating to the Liefkenshoekspoortunnel (Antwerp), Coentunnel (Amsterdam), schools in Belgium's German-speaking community (Eupen) and the Charleroi police station are still in the construction phase. CFE was selected or pre-selected for projects relating to the new prison in Haren and the Liège tram line.
Operating income turned positive as a result of Rent-A-Port, totalling €3.7 million in 2012 (€-2.2 million in 2011), with CFE's study-related costs remaining well under control.
Net income part of the group was €3.1 million versus €-1.9 million in 2011
Net income part of the group was negative (€-6.6 million) due to revenue levels that did not cover overheads, the cost of developing the new management system, and the fall in fair value of hedging instruments.
| For the year ended 31 December (in thousands €) | 2012 | 2011 |
|---|---|---|
| Revenue | 1,898,302 | 1,793,834 |
| Revenue from auxiliary activities | 72,155 | 72,078 |
| Purchases | -1,132,066 | -1,072,616 |
| Wages, salaries & social charges | -371,938 | -338,479 |
| Other operating charges | -265,374 | -268,536 |
| Depreciations | -119,683 | -101,350 |
| Impairment of goodwill | 0 | 0 |
| Operating result | 81,396 | 84,931 |
| Gross financial cost | -24,134 | -16,301 |
| Financial income from cash investments | 5,193 | 4,299 |
| Other financial charges | -19,174 | -18,569 |
| Other financial incomes | 8,966 | 14,838 |
| Financial result | -29,149 | -15,733 |
| Result before taxes for the period | 52,247 | 69,198 |
| Incom tax expense | -3,505 | -13,056 |
| Result of the year | 48,742 | 56,142 |
| Share in the result of associated companies | 489 | 868 |
| Result (including non-controlling interests) for | 49,231 | 57,010 |
| the period | ||
| Non-controlling interests | -162 | 2,071 |
| Result part of the group | 49,069 | 59,081 |
| For the year ended 31 December (in thousands €) | 2012 | 2011 |
| Result for the period (including non-controlling interests) |
49,231 | 57,010 |
| Financial instruments : change in fair values | -10,045 | -14,462 |
| Currency translation differences | 2,639 | 1,812 |
| Deferred taxes | 4,018 | 5,785 |
| Change in consolidation mode (net of deferred | 0 | 0 |
| taxes) | ||
| Other elements of the comprehensive income | -3,388 | -6,865 |
| Comprehensive income | 45,843 | 50,145 |
| - attributable to the group | 45,773 | 52,006 |
| - attributable to non-controlling interests | 70 | -1,861 |
| Net result per share (euro) (diluted and basic) | 3.75 | 4.51 |
| Comprehensive income per share (euro) (diluted and basic) |
3.50 | 3.83 |
| For the year ended 31 December (in thousands €) | 2012 | 2011 |
|---|---|---|
| Intangible assets | 12,651 | 9,839 |
| Goodwill | 33,401 | 28,725 |
| Property, plant and equipment | 980,434 | 899,618 |
| Property investments | 2,056 | 7,067 |
| Investments in associated companies | 18,364 | 15,128 |
| Other non current financial assets | 56,586 | 30,631 |
| Non current derivative instruments | 0 | 0 |
| Other non current assets | 9,283 | 10,923 |
| Deferred tax assets | 22,787 | 11,412 |
| Total non current assets | 1,135,562 | 1,013,343 |
| Inventories | 186,534 | 158,850 |
| Trade receivables and other operating receivable | 732,466 | 761,407 |
| Other current assets | 84,240 | 60,242 |
| Current derivative instruments | 0 | 148 |
| Current financial assets | 153 | 1,759 |
| Cash and cash equivalents | 260,602 | 208,347 |
| Total current assets | 1,263,995 | 1,190,753 |
| Total assets | 2,399,557 | 2,204,096 |
| Issued capital | 21,375 | 21,375 |
| Share premium | 61,463 | 61,463 |
| Gain on revaluation | 1,088 | 1,088 |
| Hedging reserves | -17,673 | -11,646 |
| Retained earnings | 460,012 | 425,999 |
| Translation differences | 6,154 | 3,423 |
| Equity - part of the group CFE | 532,419 | 501,702 |
| Non-controlling interests | 6,227 | 7,059 |
| Equity | 538,646 | 508,761 |
| Pensions and employee benefits | 13,432 | 14,720 |
| Provisions | 10,679 | 10,613 |
| Other non current liabilities | 70,745 | 82,833 |
| Financial debts | 479,120 | 434,896 |
| Non current derivative instruments | 32,853 | 24,694 |
| Deferred tax liabilities | 13,789 | 12,630 |
| Total non current liabilities | 620,618 | 580,386 |
| Provisions for termination losses | 11,652 | 16,040 |
| Provisions for other current risks | 24,168 | 31,547 |
| Trade payables & other operating liabilities | 689,475 | 635,159 |
| Tax liability due for payment | 21,579 | 24,975 |
| Current financial debts | 181,474 | 124,268 |
| Current derivative instruments | 4,201 | 5,646 |
| Other current liabilities | 307,744 | 277,314 |
| Total current liabilities | 1,240,293 | 1,114,949 |
| Total equity and liabilities | 2,399,557 | 2,204,096 |
Net financial debt(*) was €400 million at end-2012 versus €420 million at 30 June 2012 and €351 million at 31 December 2011. This figure breaks down into long-term debt of €479 million, offset by net cash of €79 million. Cash flows relating to investing activities amounted to €197 million, compared with €179 million in 2011. Investments mainly arose from DEME's capital expenditure program.
The need for working capital remains stable.
After payment of the dividend with respect to 2011 (€15.1 million), shareholders' equity totalled €539 million.
CFE has €100 million of confirmed long-term credit facilities for its general financing needs, of which €65 million were unused at 31 December 2012. DEME's investments in dredgers and other marine equipment are subject to separate financing arrangements secured on those assets.
In late May 2012, CFE issued €100 million of 6-year bonds maturing on 21 June 2018. The issue was a success, and was fully subscribed.
(*) Net financial debt at 31 December 2012 does not include the fair value of derivative instruments, which represented a liability of €37.1 million at 31 December 2012.
| Year ended 31 December (in thousands €) |
2012 | 2011 |
|---|---|---|
| Cash flows relating to operating activities | 150,008 | 102,592 |
| Cash flows relating to investing activities | -196,951 | -179,124 |
| Cash flows relating to financing activities | 95,152 | 111,450 |
| Net increase/(decrease) in cash position | 48,189 | 34,918 |
| Shareholders' equity (excluding non-controlling interests) at start of period |
501,702 | 466,061 |
| Shareholders' equity (excluding non-controlling interests) at end of period |
532,419 | 501,702 |
| Net income part of the group for the period | 49,069 | 59,081 |
| ROE | 9.8% | 12.7% |
| (in thousands €) | Issued capital |
Share premium |
Retained earnings |
Hedging reserves |
Gain on revaluation |
Translation differences |
Equity part of the group |
Non-controlling interests |
Total |
|---|---|---|---|---|---|---|---|---|---|
| As of December 31 2011 |
21,375 | 61,463 | 425,999 | (11,646) | 1,088 | 3,423 | 501,702 | 7,059 | 508,761 |
| Global result for the period |
49,069 | (6,027) | 2,731 | 45,773 | 70 | 45,843 | |||
| Dividends paid to shareholders |
(15,056) | (15,056) | (15,056) | ||||||
| Paid to non controlling shareholders |
(902) | (902) | |||||||
| As of December 31 2012 |
21,375 | 61,463 | 460,012 | (17,673) | 1,088 | 6,154 | 532,419 | 6,227 | 538,646 |
| 31.12.2012 | 31.12.2011 | |
|---|---|---|
| Total number of shares | 13,092,260 | 13,092,260 |
| Operating result after deduction of the net financial | 3.99 | 5.29 |
| charges per share | ||
| Net profit of the group per share | 3.75 | 4.51 |
| (in thousands €) | 2012 | 2011 |
|---|---|---|
| Turnover and other income | 407,806 | 431,649 |
| Turnover | 349,506 | 361,506 |
| Operational result | -721 | 663 |
| Financial result | 24,295 | 30,762 |
| Current result | 23,574 | 31,425 |
| Exceptional revenues | 44 | 696 |
| Exceptional costs | -273 | -175 |
| Result before taxes | 23,345 | 31,946 |
| Taxes | -4 | 190 |
| Result of the year | 23,341 | 32,136 |
| (in thousands €) | 31.12.2012 | 31.12.2011 |
|---|---|---|
| Assets | ||
| Fixed assets | 371,723 | 306,139 |
| Current assets | 284,942 | 316,370 |
| Total Assets | 656,665 | 622,509 |
| (in thousands €) | 31.12.2012 | 31.12.2011 |
| Equity and liabilities | ||
| Equity | 172,275 | 163,991 |
| Provisions & deferred taxes | 46,258 | 53,020 |
| Non current liabilities | 117,578 | 42,945 |
| Current liabilities | 320,554 | 362,553 |
| Total equity and liabilities | 656,665 | 622,509 |
In a difficult economic environment the well filled order book enables us to consider a growth of the turnover in 2013.
At the Shareholders Meeting of 2 May 2013, CFE SA's Board of Directors will show its confidence in the future by proposing to maintain a gross dividend per share of €1.15, the same as the dividend paid in 2011, corresponding to a net dividend of €0.8625 per share and a total pay-out of €15,056,099. Retained earnings after the dividend payment will amount to €54,422,043.
At December 31, 2012, CFE's share capital consisted of 13,092,260 shares.
The extraordinary shareholders meeting of 8 October 2007 approved:
The share dematerialisation and splitting process is still under way.
The split of the registered shares has been carried out automatically and shareholders have been automatically recognised as the owners of the appropriate number of split shares in the share register.
The split of bearer shares recorded in the share register at 1 January 2008 has been carried out automatically and shareholders have been automatically allocated the appropriate number of split shares.
For the exchange and split of bearer shares still physically held, shareholders must either hand these in to a financial institution of their choice for registration in a stock account or to the company's registered offices for recording in the shareholders' register. The number of split shares will be recorded in the stock account or in the shareholders' register.
Since 1 January 2008, the exercise of any right attached to bearer shares has been suspended for as long as they are physically held. Since that date, to participate in a shareholders meeting, the holders of such bearer shares must apply to have the shares exchanged for registered shares or have them dematerialised.
Bearer shares issued by the company, which are neither registered nor recorded in the shareholders' register, will be converted by operation of law into dematerialised shares on 31 December 2013.
Euroclear Belgium has been appointed as the settlement organisation. Registered shares are held in electronic form and Euroclear Belgium (CIK SA) is in charge of managing them.
There has been no issue of convertible bonds or warrants.
Banque Degroof has been appointed as the "Main Paying Agent".
Financial institutions with whom holders of financial instruments may exercise their financial rights are Banque Degroof, BNP Paribas Fortis and ING Belgique.
The general meeting held 10 October 2012 approved the change of control clause in the prospectus on the bond issue of 29 May 2012.
The board of directors proposes to the ordinary shareholders' general meeting:
The Statutory Auditor, Deloitte, Reviseurs d'Entreprises, represented by Pierre-Hugues Bonnefoy, has confirmed that he has no reservations as to the accounting information reported in this press release and that it is in line with the financial statements as approved by the Board of Directors.
* * *
CFE is a multidisciplinary group of companies operating in construction and associated services. It is listed on Euronext Brussels and 47% owned by VINCI. CFE is a major player in Belgium's construction industry, with a presence in the Netherlands, the Grand Duchy of Luxembourg, Central Europe, Africa, Asia and the Middle East. CFE owns 50% of the capital of DEME, one of the world's leading dredging contractors.
This press release is also disposable on www.cfe.be.
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