Earnings Release • Feb 28, 2018
Earnings Release
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Increase of the revenue, EBITDA, EBIT, net result, order book and dividend
• Order book : € 4,850.8 million
• Gross dividend per share € 2.40**
| In million € | 2017 | 2016 | Change 2017/2016 |
|---|---|---|---|
| Revenue | 3,066.5 | 2,797.1 | +9.6% |
| Self-financing capacity (EBITDA) (*) | 500.7 | 465.9 | +7.5% |
| % of revenue | 16.3% | 16.7% | |
| Income from operating activities (*) | 267.2 | 227.6 | +17.4% |
| % of revenue | 8.7% | 8.1% | |
| Operating income (EBIT) (*) | 249.4 | 226.8 | +10.0% |
| % of revenue | 8.1% | 8.1% | |
| Net income part of the group | 180.4 | 168.4 | +7.1% |
| % of revenue | 5.9% | 6.0% | |
| Earnings per share (in euro) | 7.13 | 6.65 | +7.2% |
| Gross dividend per share (in euro) (**) | 2.40 | 2.15 | +11.6% |
(*) The definitions are included in the 'Consolidated financial statements' section of the financial report.
(**) Amount to be submitted for approval to the annual general meeting of 3 May 2018.
| In million € | 2017 | 2016 | Change 2017/2016 |
|---|---|---|---|
| Equity – share of the group | 1,641.9 | 1,521.6 | +7.9% |
| Net financial debt | 351.9 | 213.1 | +65.1% |
| Order book | 4,850.8 | 4,756.7 | +2.0% |
The CFE Group reported € 3,066.5 million revenue in 2017, which is up 9.6% compared to 2016. This increase was expected at DEME, which reported slower activity in 2016. On the other hand, CFE Contracting reported a slight decrease in revenue.
Thanks to the good performance of the three divisions of the group, the EBITDA slightly exceeded the threshold of € 500 million, or up 7.5%.
The operating income (EBIT) increased by 10% to € 249.4 million, while the net result, share of the group, topped the previous record of 2015 at € 180.4 million.
The Contracting and Real Estate Development divisions strongly increased their contribution to the group's net result, while the contribution of DEME remained stable.
The equity, share of the group, amounted to € 1,641.9 million, which is up 7.9%.
Despite the ambitious investment programme for the renewal and expansion of the fleet, and the acquisition of the company A2Sea, the increase in net financial debt was limited to € 138.8 million thanks to the significant improvement in DEME's working capital requirement.
The order book increased slightly to € 4,850.8 million. It remained at a high level for DEME and even grew substantially if we take into account the contracts signed but not yet included in the order book (approximately € 1.7 billion). In Contracting, the order book increased significantly due to, but not only, the acquisition of the Van Laere group.
| In million € | 2017 | 2016 | Change 2017/2016 |
||||||
|---|---|---|---|---|---|---|---|---|---|
| DEME | Restatements DEME (*) |
Total | DEME | Restatements DEME (*) |
Total | ||||
| Revenue | 2,356.0 | 0 | 2,356.0 | 1,978.2 | 0 | 1,978.2 | +19.1% | ||
| EBITDA (**) | 455.5 | 0 | 455.5 | 447.4 | 0 | 447.4 | +1.8% | ||
| Operating income (EBIT) (**) |
217.8 | -10.5 | 207.3 | 213.7 | -6.3 | 207.4 | 0.0% | ||
| Net income share of the group |
155.1 | 1.4 | 156.5 | 155.3 | 0.1 | 155.4 | +0.7% | ||
| Net financial debt | 285.7 | 2.0 | 287.7 | 151.2 | 3.8 | 155.0 | +85.6% | ||
| Order book | 3,520.0 | 0 | 3,520.0 | 3,800.0 | 0 | 3,800.0 | -7.4% |
(*) Amounts restated to take account of the recognition at fair value of the identifiable assets and liabilities of DEME following the acquisition of an additional 50% of the DEME shares on 24 December 2013.
(**) The definitions are included in the 'Consolidated financial statements' section of the financial report.
The key figures shown below are presented according to the economic approach whereby the jointly controlled companies are proportionally consolidated (accounting rules applicable before 1 January 2014).
| In million € | 2017 | 2016 | Change 2017/2016 |
|---|---|---|---|
| Revenue | 2,365.7 | 1,978.2 | +19.6% |
| EBITDA (*) | 456.2 | 450.1 | +1.4% |
| Operating income (EBIT) (*) |
222.6 | 217.6 | +2.3% |
| Net income share of the group | 155.1 | 155.3 | -0.1% |
| Net financial debt | 296.2 | 154.6 | +91.6% |
| Order book | 3,520.0 | 3,800.0 | -7.4% |
(*) The definitions are included in the 'Consolidated financial statements' section of the financial report.
DEME's revenue amounted to € 2,365.7 million, which is up 19.6%.
Business was particularly buoyant in the renewable energy segment (GeoSea, Tideway, Dredging International), which reported a vigorous growth in revenue. Four major projects contributed to this performance, two of which (Rentel and Merkur) were co-developed by DEME Concessions:
In the dredging segment, DEME continued work on the TTP1 (Tuas Terminal – phase 1) project in Singapore, along with many other projects in Africa, India and South America. Maintenance dredging activity was buoyant in Belgium, Germany and Africa.
In Panama, DEME successfully completed the widening and deepening of the Atlantic access channel.
| In % | 2017 | 2016 |
|---|---|---|
| Capital dredging | 21% | 34% |
| Maintenance dredging | 14% | 12% |
| Fallpipe and landfalls | 8% | 7% |
| Environment | 7% | 10% |
| Civil works | 3% | 3% |
| Marine works | 47% | 34% |
| In % | 2017 | 2016 |
|---|---|---|
| Europe (EU) | 69% | 56% |
| Europe (non-EU) | 2% | 4% |
| Africa | 10% | 12% |
| Americas | 3% | 8% |
| Asia-Pacific | 12% | 13% |
| Middle East | 0% | 3% |
| India and Pakistan | 4% | 4% |
DEME realized an EBITDA of € 456.2 million in 2017, which is slightly up compared to 2016 (€ 450.1 million).
The EBITDA margin came to 19.3% of revenue.
The order book shrank by 7.4% to € 3,520 million. This decrease needs to be qualified, since several major orders won in 2017 have not yet been included in the order book, as they are conditional upon the financial close of the project by the customer. They are:
Another project not yet included in the order book is the contract for the design and construction of the Fehmarnbelt Link, the tunnel linking Denmark and Germany. Work on this project, worth an estimated € 700 million (DEME share), will only begin once the German authorities have delivered the necessary building permits.
The orders not yet included in the order book totalled approximately € 1.7 billion at 31 December 2017.
Order intake reached € 2.1 billion in 2017. The main commercial successes during the financial year include (i) the EPCI contract for the Hohe See offshore wind farm and its extension Albatros, (ii) the contract for the design, construction and two-year maintenance of the new Terneuzen lock in the Netherlands, (iii) the contract for the supply, installation and maintenance of three submarine power cables that will connect the MOG (Modular Offshore Grid, an offshore platform to which four Belgian wind farms will be connected), and (iv) the DBFM (Design Build Finance Maintain) contract for the new Rijnlandroute link in the Netherlands.
Investments amounted to € 614.2 million in 2017, and primarily consist of down payments on the vessels under construction, the capitalization of maintenance costs, and the acquisition of the companies A2Sea and G-Tec.
On 31 August 2017, DEME closed the acquisition of A2Sea (Danish company owning two vessels specialized in the installation of offshore wind turbines: the Sea Installer and the Sea Challenger). The impact of this acquisition on DEME's net financial debt amounted to € 166.9 million.
On 7 November 2017, GeoSea acquired the majority of the shares (72.5%) of G-Tec. This company, based in the Liège area, specializes in offshore geotechnical and geological site investigations, marine geophysical and environmental surveys, and deep-sea engineering services. G-Tec owns an offshore geotechnical investigation vessel: Omalius.
Of the eight vessels commissioned in 2015 and 2016, worth a total of € one billion, two have already been delivered: the trailing suction hopper dredgers Minerva and Scheldt River, with a capacity of 3,500 m³ and 8,400 m³ respectively. Those two vessels are the first of DEME's fleet to run on LNG (Liquefied Natural Gas), thereby substantially reducing the emission of greenhouse gases.
The multipurpose vessel Living Stone, the self-propelled jack-up vessel Apollo, and the crane vessel Gulliver are due for delivery in 2018.
The last three vessels - the dredger Bonny River (capacity of 15,000 m³), the Smart Mega Cutter Suction Dredger Spartacus, and the dynamic positioning crane vessel Orion - are expected to become operational during 2019-2020.
DEME's net financial debt amounted to € 296.2 million. This low level of debt in relation to the level of investment in 2017 is explained by the operating cash flows and the significant improvement in the working capital requirement.
| In million € | 2017 | 2016 | Change 2017/2016 |
|---|---|---|---|
| Revenue | 717.6 | 770.5 | -6.9% |
| Operating income (EBIT) (*) | 27.2 | 20.0 | +36.0% |
| Net income share of the group | 15.4 | 10.4 | +48.1% |
| Net financial debt | 90.5 | 92.0 | -1.6% |
| Order book | 1,229.7 | 850.5 | +44.6% |
(*) The definitions are included in the "Consolidated Financial Statements" section of the financial report..
The revenue of the Contracting division amounted to € 717.6 million, down 6.9%.
This decrease, which was expected, is primarily attributable to the Belgian entities of the Construction segment, due to the delayed start of several major projects.
Internationally, the vigorous growth of the Polish activities is worth mentioning, while the deterioration of the socioeconomic situation in Tunisia obliged the Tunisian subsidiary to scale down its activities.
The main projects under construction include the Lycée Français in Luxembourg, the ZNA and AZ Sint Maarten hospitals in Flanders, and the real estate complex AGORA in Louvain-la-Neuve.
The Multitechnics and Rail Infra & Utility Networks segments reported a slight fall in revenue (-2.0%).
| In million € | 2017 | 2016 | Change in % |
|---|---|---|---|
| Construction | 499.8 | 548.5 | -8.9% |
| Buildings, Belgium | 346.7 | 405.6 | -14.5% |
| Buildings, International | 153.1 | 142.9 | +7.1% |
| Multitechnics | 155.3 | 159.2 | -2.4% |
| Rail Infra & Utility Networks | 62.5 | 62.8 | -0.5% |
| Total Contracting | 717.6 | 770.5 | -6.9% |
For the second year in a row, operating income increased substantially to € 27.2 million, or 3.8% of revenue.
All segments made a positive contribution to the division's operating income. Unlike in previous years, it was the Construction segment that reported the most vigorous growth in income, particularly BPC (branch of CFE BBW operating in Brussels and in Walloon Brabant).
| In million € | 31 December 2017 | 31 December 2016 | Change in % |
|---|---|---|---|
| Construction | 978.8 | 648.7 | +50.9% |
| Buildings, Belgium | 767.3 | 505.0 | +51.9% |
| Buildings, International | 211.5 | 143.7 | +47.2% |
| Multitechnics | 152.6 | 143.4 | +6.4% |
| Rail Infra & Utility Networks | 98.3 | 58.4 | +68.3% |
| Total Contracting | 1,229.7 | 850.5 | +44.6% |
| Total Contracting (excl. Van Laere and excl. Coghe) |
978.5 | 850.5 | +15.1% |
The order book increased significantly to € 1,229.7 million. This represents a 44.6% increase (+15.1% on a like-for-like basis), which is explained by the incorporation of the Van Laere group (€ 241.8 million order book as at 31 December 2017) and by a high order intake reported by the entities of the Construction segment operating in Brussels and in Poland, as well as by the entities of the Rail Infra & Utility Networks segment.
On 21 December 2017, CFE Contracting acquired 100% of the shares of Aannemingen Van Laere.
This acquisition had been approved beforehand by the boards of directors of CFE and CFE Contracting after obtaining the opinion of the committee of independent directors.
The Van Laere group, composed of Aannemingen Van Laere and its subsidiaries, Thiran Group and Arthur Vandendorpe, is a general contractor operating in the three regions of Belgium. In 2017, it reported € 138.1 million consolidated revenue.
The acquisition price was € 17.1 million, or an initial price of € 18.4 million reduced by € 1.3 million to take account of the evolution of the adjusted net asset value of the Van Laere group at year-end 2017.
Given that the Van Laere group had a net cash position of € 6.9 million at 31 December 2017, the transaction had an impact of € -10.2 million on the division's net cash position.
The consolidated results of the Van Laere group will be incorporated in the group's financial statements as from 1 January 2018.
On 19 December 2017, CFE Contracting acquired José Coghe-Werbrouck for € 7.7 million; this company, based in West Flanders, specializes in railway works (laying railway tracks). The company is now part of the Rail Infra & Utility Networks segment. It owns an extensive machinery, including a Tracklayer machine for replacing railway switches.
Despite the acquisitions of the Van Laere group and the company Coghe, CFE Contracting was able to maintain a virtually stable net cash position in relation to 31 December 2016. This good performance is explained by solid operating cash flows and an improved working capital requirement.
| In million € | 2017 | 2016 | Change 2017/2016 |
|---|---|---|---|
| Revenue | 10.9 | 12.1 | -9.9% |
| Operating income (EBIT) (*) | 23.4 | 4.3 | n.s. |
| Net income share of the group | 22.3 | 1.4 | n.s. |
| Net financial debt | 68.8 | 87.6 | -21.5% |
(*) The definitions are included in the "Consolidated Financial Statements" section of the financial report.
| In million € | 31 December 2017 | 31 December 2016 |
|---|---|---|
| Unsold units post completion | 6 | 17 |
| Properties under construction | 69 | 35 |
| Properties in development | 58 | 78 |
| Total capital employed | 133 | 130 |
| In million € | 31 December 2017 | 31 December 2016 |
|---|---|---|
| Belgium | 82 | 78 |
| Luxembourg | 20 | 31 |
| Poland | 31 | 21 |
| Total | 133 | 130 |
(*) Real estate projects is the sum of the equity and net financial debt of the real estate division.
In the first half of 2017, BPI Luxembourg won the tender launched by the City of Differdange for the development of a mixed-use real estate complex with a total gross floor area of 25,500 m² ('Entrée de ville' project).
During the third quarter of 2017, BPI Polska acquired a majority stake (90%) in a company owning a building plot in Poznan on which a residential property of 13,000 m² above ground (Vilda Park project) will be built.
In December 2017, BPI Luxembourg acquired a real estate company owning a building plot on Route d'Arlon in Luxembourg. It involves an office development of around 4,000 m² (demolition and rebuilding).
In 2017, BPI sold three important stakes which it held in the Kons (Luxembourg), Oosteroever (Ostend, Belgium) and Ronndriesch (Luxembourg) projects.
During the year, several major projects were launched (construction and marketing):
New phases were also initiated on the sites of Erasmus Gardens in Anderlecht, Hauts Prés in Uccle, and Bulwary Ksiazece in Wroclaw.
On the whole, sales of residential units are going ahead in a satisfactory way.
The capital employed related to real estate projects increased slightly to € 133 million at 31 December 2017. BPI's projects have a development potential of 630,000 m², BPI's share (mainly residential projects).
During the year, BPI managed to substantially reduce its stock of unsold units post completion, which now just represent 5% of the real estate projects.
The net financial debt of the division amounted to € 68.8 million, down € 18.8 million compared with 31 December 2016.
In December 2017, BPI successfully issued its first bond of € 30 million with a maturity of five years and an interest rate of 3.75% per annum.
BPI's net result amounted to € 22.3 million, an all-time high performance and primarily the result of capital gains on the sale of the Oosteroever project in Ostend (residential development sold to its partner) and the Kons project in Luxembourg (office building sold to an institutional investor).
| Holding, non-transferred activities and inter division eliminations | |
|---|---|
| --------------------------------------------------------------------- | -- |
| In million € | 2017 | 2016 | Change 2017/2016 |
|---|---|---|---|
| Revenue | -18.1 | 36.3 | n.s. |
| Operating income (EBIT) (*) | -8.4 | -4.9 | +71.4% |
| Net income share of the group | -13.7 | 1.2 | n.s. |
| Net financial debt | 85.9 | 62.4 | +37.7% |
(*) Definitions are listed under sections "Consolidated Financial Statements" of the financial report.
Revenue, adjusted for inter-division eliminations (€ -52.2 million), amounted to € 34.1 million. In accordance with the strategy that was outlined earlier, the operational activities of the Holding division will be progressively phased out. The main project still in progress is the Brussels-South wastewater treatment plant, which is progressing according to the revised planning.
The operating income amounted to € -8.4 million, compared to € -4.9 million in 2016.
The division's operating income was adversely affected by the operating costs of the Grand Hotel in N'Djamena during the first six months of 2017 and the negative contribution of Rent-A-Port.
2017 was a year of transition for Rent-A-Port, marked by shrinking sales of industrial land in Vietnam. This situation is attributable to delays in the construction of a dyke that would allow the development and marketing of a new area of several hundred hectares in the industrial zone of Nam Dinh Vu in North Vietnam. The dyke is due for completion before the end of 2018. Rent-A-Port was also affected by the weakening of the US dollar against the euro, which was reflected in the recognition of unrealized exchange losses.
The net result amounted to € -13.7 million (€ +1.2 million in 2016).
The 2016 financial year had been marked by the recognition of capital gains realized on the sale of CFE's stakes in two companies owning concessions in infrastructure projects. No disposals took place in 2017.
There has been no change in the amount of the receivables since 31 December 2016.
| Year ended 31 December In thousands € |
2017 | 2016 |
|---|---|---|
| Revenue | 3,066,525 | 2,797,085 |
| Revenue from auxiliary activities | 116,588 | 85,794 |
| Purchases | -1,726,761 | -1,504,685 |
| Remuneration and social security payments | -546,699 | -533,200 |
| Other operating charges | -404,180 | -384,649 |
| Depreciations and amortization | -238,316 | -232,775 |
| Goodwill Impairment | 0 | 0 |
| Income from operating activities | 267,157 | 227,570 |
| Earnings from associates and joint ventures | -17,710 | -784 |
| Operating income | 249,447 | 226,786 |
| Cost of financial debt | -14,362 | -31,521 |
| Other financial expenses and income | -7,904 | 7,567 |
| Net financial income/expense | -22,266 | -23,954 |
| Pre-tax income | 227,181 | 202,832 |
| Income tax expense | -48,430 | -30,580 |
| Net income for the period | 178,751 | 172,252 |
| Attributable to owners of non-controlling interests | 1,691 | -3,841 |
| Net income – share of the group | 180,442 | 168,411 |
| Year ended 31 December In thousands € |
2017 | 2016 |
| Net income for the period | 178,751 | 172,252 |
| Change in fair value related to hedging instruments | 6,463 | 2,230 |
| Currency translation differences | -4,754 | -340 |
| Deferred taxes | -1,583 | 1,143 |
| Other elements of the comprehensive income to be reclassified to profit or loss in subsequent period |
126 | 3,033 |
| Remeasurement on defined benefit plans | -2,227 | -18,901 |
| Deferred taxes | -3,382 | 6,510 |
| Other elements of the comprehensive income not to be reclassified to profit or loss in subsequent period |
-5,609 | -12,391 |
| Total elements of the comprehensive income directly accounted in equity |
-5,483 | -9,358 |
| Comprehensive income | 173,268 | 162,894 |
| - attributable to owners of the parent | 174,771 | 159,178 |
| - attributable to owners of non-controlling interests | -1,503 | 3,716 |
| Net income per share (€) (basic and diluted) | 7.13 | 6.65 |
| Comprehensive income per share (€) (basic and diluted) | 6.90 | 6.29 |
| ROE (*) | 11.9% | 11.8% |
(*) Definitions are listed under sections "Consolidated Financial Statements" of the financial report.
| Year ended 31 December In thousands € |
2017 | 2016 |
|---|---|---|
| Intangible assets | 91,343 | 95,441 |
| Goodwill | 184,930 | 175,169 |
| Property, plant and equipment | 2,138,208 | 1,683,304 |
| Investments in associates and joint ventures | 140,510 | 141,355 |
| Other non-current financial assets | 147,719 | 153,976 |
| Non-current derivative instruments | 921 | 510 |
| Other non-current assets | 7,798 | 23,518 |
| Deferred tax assets | 104,022 | 126,944 |
| Total non-current assets | 2,815,451 | 2,400,217 |
| Inventories | 138,965 | 94,836 |
| Trade receivables and other operating receivables | 1,132,306 | 1,160,306 |
| Other current assets | 32,963 | 38,430 |
| Current derivative instruments | 4,156 | 2,311 |
| Current financial assets | 34 | 48 |
| Assets held for sale | 0 | 19,916 |
| Cash and cash equivalents | 523,018 | 612,155 |
| Total current assets | 1,831,442 | 1,928,002 |
| Total assets | 4,646,893 | 4,328,219 |
| Share capital | 41,330 | 41,330 |
| Share premium | 800,008 | 800,008 |
| Retained earnings | 840,543 | 714,527 |
| Defined benefits plans | -25,268 | -19,464 |
| Hedging reserves | -2,457 | -7,337 |
| Translation differences | -12,252 | -7,505 |
| Equity – part of the group CFE | 1,641,904 | 1,521,559 |
| Non-controlling interests | 14,421 | 14,918 |
| Equity | 1,656,325 | 1,536,477 |
| Retirement benefit obligations and employee benefits | 53,149 | 51,215 |
| Provisions | 30,183 | 43,085 |
| Other non-current liabilities | 4,497 | 5,645 |
| Bonds - non current | 231,378 | 303,537 |
| Financial debts | 419,093 | 367,147 |
| Non-current derivative instruments | 7,209 | 18,475 |
| Deferred tax liabilities Total non-current liabilities |
130,023 875,532 |
151,970 941,074 |
| Current provisions | 82,530 | 65,113 |
| Trade payables & other operating liabilities | 1,276,446 | 1,138,288 |
| Tax liability due for payment | 43,275 | 69,398 |
| Bonds - current | 99,959 | 0 |
| Current financial debts | 124,497 | 154,522 |
| Current derivative instruments | 7,445 | 23,515 |
| Liabilities held for sale | 0 | 6,004 |
| Other current liabilities | 480,884 | 393,828 |
| Total current liabilities | 2,115,036 | 1,850,668 |
| Total equity and liabilities | 4,646,893 | 4,328,219 |
| For the period ended 31 December In thousands € |
2017 | 2016 (*) |
|---|---|---|
| Operating activities | ||
| Income from operating activities | 267,157 | 227,570 |
| Depreciation and amortisation of intangible assets, property, plant & equipment and investment property |
238,316 | 232,775 |
| Net provision expense | 4,986 | -3,941 |
| Impairment on current and non-current assets and other non cash items |
-9,725 | 9,459 |
| Sales of non-current assets | -9,662 | -10,341 |
| Dividends from associates and Joint Ventures | 6,507 | 15,221 |
| Cash flow from operating activities before changes in working capital |
497,579 | 470,743 |
| Decrease/(increase) in trade receivables and other current and non current receivables |
107,002 | 101,564 |
| Decrease/(increase) in inventory | -8,466 | -19,113 |
| Increase/(Decrease) in trade payables and other current and non current payables |
75,012 | -162,691 |
| Income tax paid/received | -42,282 | 34,111 |
| Cash flow from operating activities | 628,845 | 424,614 |
| Investing activities | ||
| Sales of non-current assets | 18,322 | 7,138 |
| Purchases of non-current assets | -458,210 | -188,873 |
| Acquisition of subsidiaries net of cash acquired | -181,370 | 0 |
| Change in percentage held in associates | 0 | 36,456 |
| Capital increase in investments in associates | -32,323 | -19,883 |
| Sales of subsidiaries | 574 | 0 |
| Loans granted | -9,926 | -49,342 |
| Cash flow from investing activities | -662,933 | -214,504 |
| Financing activities | ||
| Interests paid | -29,347 | -40,498 |
| Interests received | 13,970 | 11,125 |
| Other financial expenses and income | -12,218 | -10,854 |
| Borrowings | 240,289 | 216,045 |
| Reimbursements of borrowings | -212,271 | -203,758 |
| Dividends paid | -54,426 | -60,755 |
| Cash flow from financing activities | -54,003 | -88,695 |
| Net Increase/(Decrease) in cash position | -88,091 | 121,415 |
| Cash and cash equivalents at start of the year | 612,155 | 491,952 |
| Exchange rate effects | -1,046 | -1,212 |
| Cash and cash equivalents at end of period | 523,018 | 612,155 |
(*) Amounts restated in accordance with changes in the accounting presentation of the consolidated cash flow statement as adapted by the group with effect from 1 January 2017.
The tangible assets increased by € 454.9 million to € 2,138.2 million. This increase is primarily attributable to DEME, which continued its construction programme of new vessels and acquired the company A2Sea in 2017.
Following the sale of the company Ronndriesch, there are no longer any assets or liabilities held for sale at 31 December 2017.
Taking into account the payment of a dividend of € 54.4 million in May 2017, the consolidated equity amounted to € 1,656.3 million at 31 December 2017.
The net financial debt breaks down into a short-term and long-term financial debt of € 650.5 million and € 224.4 million respectively, and a positive net cash position of € 523.0 million.
CFE SA has confirmed medium-term credit facilities for its general financing needs totalling €115 million. Those facilities had not been drawn down at year-end 2017.
CFE, DEME, CFE Contracting and BPI are all in compliance with the banking covenants.
| In thousands € | Share capital | Share premium | Retained earnings | Defined benefits plans |
Reserves related instruments to hedging |
Translation differences |
Equity attributable to owners of the parent |
Non-controlling interests |
Total |
|---|---|---|---|---|---|---|---|---|---|
| 31 December 2016 | 41,330 | 800,008 | 714,527 | -19,464 | -7,337 | -7,505 | 1,521,559 | 14,918 | 1,536,477 |
| Comprehensive income for the period |
180,442 | -5,804 | 4,880 | -4,747 | 174,771 | -1,503 | 173,268 | ||
| Dividends paid to shareholders |
-54,426 | -54,426 | -54,426 | ||||||
| Dividends paid to non-controlling interests |
-528 | -528 | |||||||
| Change in con solidation scope and other movements |
1,534 | 1,534 | |||||||
| 31 December 2017 | 41,330 | 800,008 | 840,543 | -25,268 | -2,457 | -12,252 | 1,641,904 | 14,421 | 1,656,325 |
| 31 December 2017 | 31 December 2016 | |
|---|---|---|
| Total number of shares | 25,314,482 | 25,314,482 |
| Net result part of the group per share (in €) | 7.13 | 6.65 |
| Equity part of the group per share (in €) | 64.86 | 60.11 |
| Revenue | Income from operating activities | Operating income (EBIT) | Financial income | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| In thousands € | 2017 | 2016 | 2017 | % Revenue | 2016 | % Revenue | 2017 | % Revenue | 2016 | % Revenue | 2017 | 2016 |
| Dredging and environment |
2,356,014 | 1,978,250 | 230,507 | 9.78% | 226,956 | 11,47% | 217,775 | 9.24% | 213,677 | 10.80% | -21,117 | -33,797 |
| Correction DEME | -5,468 | -5,276 | -10,510 | -6,253 | 4,218 | 7,029 | ||||||
| Contracting | 717,649 | 770,491 | 27,212 | 3.79% | 19,987 | 2,59% | 27,212 | 3.79% | 19,984 | 2.59% | -134 | -694 |
| Real Estate | 10,900 | 12,075 | 21,799 | 199.99% | -1,469 | -12,17% | 23,388 | 214.5% | 4,263 | 35.30% | -902 | -2,799 |
| Holding and non-transferred activities |
34,141 | 60,264 | -7,704 | -12,770 | -9,229 | -5,027 | -4,331 | 6,307 | ||||
| Eliminations between segments |
-52,179 | -23,995 | 811 | 142 | 811 | 142 | ||||||
| Total consolidated | 3,066,525 | 2,797,085 | 267,157 | 8.71% | 227,570 | 8,14% | 249,447 | 8.13% | 226,786 | 8.11% | -22,266 | -23,954 |
| Taxes | Net income of the group | Non-cash items | EBITDA | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| In thousands € | 2017 | 2016 | 2017 | % Revenue | 2016 | % Revenue | 2017 | 2016 | 2017 | % Revenue | 2016 | % Revenue |
| Dredging and environment |
-43,269 | -20,416 | 155,055 | 6.58% | 155,334 | 7.85% | 224,993 | 220,400 | 455,500 | 19.33% | 447,356 | 22.61% |
| Correction DEME | 7,739 | -670 | 1,448 | 106 | 5,468 | 5,276 | ||||||
| Contracting | -11,726 | -9,228 | 15,351 | 2.14% | 10,351 | 1.34% | 406 | 12,758 | 27,618 | 3.85% | 32,745 | 4.25% |
| Real Estate | -256 | -18 | 22,255 | 204.17% | 1,446 | 11.98% | 1,860 | 2,034 | 23,659 | 217.06% | 565 | 4.68% |
| Holding and non-transferred activities |
-856 | -201 | -14,416 | 1,079 | 850 | -2,175 | -6,854 | -14,945 | ||||
| Eliminations between segments |
-62 | -47 | 749 | 95 | 811 | 142 | ||||||
| Total consolidated | -48,430 | -30,580 | 180,442 | 5.88% | 168,411 | 6.02% | 233,577 | 238,293 | 500,734 | 16.33% | 465,863 | 16.66% |
| 31 December 2017 In thousands € |
Dredging and Environment |
Contracting | Real Estate | Holding & non-transferred activities |
Eliminations between divisions |
Consolidated total |
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Goodwill | 163,370 | 21,560 | 0 | 0 | 0 | 184,930 |
| Property, plant and equipment | 2,073,436 | 63,736 | 526 | 510 | 0 | 2,138,208 |
| Non-current loans to consolidated group companies |
0 | 0 | 0 | 20,000 | -20,000 | 0 |
| Other non-current financial assets | 94,138 | 754 | 34,981 | 17,846 | 0 | 147,719 |
| Other non-current assets | 278,749 | 10,894 | 32,889 | 1,267,880 | -1,245,818 | 344,594 |
| Inventories | 15,714 | 24,020 | 99,216 | 1,640 | -1,625 | 138,965 |
| Cash and cash equivalents | 434,687 | 59,234 | 3,324 | 25,773 | 0 | 523,018 |
| Internal cash position - cash pooling - assets |
0 | 47,985 | 0 | 1,928 | -49,913 | 0 |
| Other current assets | 727,178 | 290,454 | 26,723 | 136,074 | -10,970 | 1,169,459 |
| Total assets | 3,787,272 | 518,637 | 197,659 | 1,471,651 | -1,328,326 | 4,646,893 |
| EQUITY AND LIABILITIES |
||||||
|---|---|---|---|---|---|---|
| Equity | 1,570,503 | 74,226 | 64,433 | 1,194,605 | -1,247,442 | 1,656,325 |
| Non-current borrowings from consolidated group companies |
0 | 0 | 20,000 | 0 | -20,000 | 0 |
| Bonds - non current | 201,900 | 0 | 29,478 | 0 | 0 | 231,378 |
| Non-current financial liabilities | 401,559 | 11,134 | 6,400 | 0 | 0 | 419,093 |
| Other non-current liabilities | 177,604 | 18,241 | 8,846 | 20,370 | 0 | 225,061 |
| Bonds - current | 0 | 0 | 0 | 99,959 | 0 | 99,959 |
| Current financial liabilities | 118,889 | 5,608 | 0 | 0 | 0 | 124,497 |
| Internal cash position - cash pooling - liabilities |
0 | 0 | 16,293 | 33,620 | -49,913 | 0 |
| Other current liabilities | 1,316,817 | 409,428 | 52,209 | 123,097 | -10,971 | 1,890,580 |
| Total equity and liabilities | 3,787,272 | 518,637 | 197,659 | 1,471,651 | -1,328,326 | 4,646,893 |
| 31 December 2016 In thousands € |
Dredging and Environment |
Contracting | Real Estate | Holding & non-transferred activities |
Eliminations between divisions |
Consolidated total |
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Goodwill | 155,960 | 19,209 | 0 | 0 | 0 | 175,169 |
| Property, plant and equipment | 1,648,984 | 33,409 | 224 | 687 | 0 | 1,683,304 |
| Non-current loans to consolidated group companies |
0 | 0 | 0 | 20,000 | -20,000 | 0 |
| Other non-current financial assets | 98,860 | 160 | 32,913 | 22,043 | 0 | 153,976 |
| Other non-current assets | 318,519 | 4,586 | 44,424 | 1,266,368 | -1,246,129 | 387,768 |
| Inventories | 25,261 | 15,855 | 53,645 | 1,676 | -1,601 | 94,836 |
| Cash and cash equivalents | 527,733 | 43,481 | 5,574 | 35,367 | 0 | 612,155 |
| Internal cash position - cash pooling - assets |
0 | 61,005 | 0 | 60,714 | -121,719 | 0 |
| Other current assets | 790,584 | 253,355 | 54,552 | 154,630 | -32,110 | 1,221,011 |
| Total assets | 3,565,901 | 431,060 | 191,332 | 1,561,485 | -1,421,559 | 4,328,219 |
| EQUITY AND LIABILITIES |
||||||
|---|---|---|---|---|---|---|
| Equity | 1,470,050 | 66,869 | 42,745 | 1,204,291 | -1,247,478 | 1,536,477 |
| Non-current borrowings from consolidated group companies |
0 | 0 | 20,000 | 0 | -20,000 | 0 |
| Bonds - non current | 203,578 | 0 | 0 | 99,959 | 0 | 303,537 |
| Non-current financial liabilities | 327,193 | 9,916 | 38 | 30,000 | 0 | 367,147 |
| Other non-current liabilities | 214,909 | 12,472 | 14,792 | 28,467 | -250 | 270,390 |
| Current financial liabilities | 151,947 | 2,575 | 0 | 0 | 0 | 154,522 |
| Internal cash position - cash pooling - liabilities |
0 | 0 | 73,185 | 48,582 | -121,767 | 0 |
| Other current liabilities | 1,198,224 | 339,228 | 40,572 | 150,186 | -32,064 | 1,696,146 |
| Total equity and liabilities | 3,565,901 | 431,060 | 191,332 | 1,561,485 | -1,421,559 | 4,328,219 |
| 31 December 2017 In thousands € |
Dredging and Environment |
Contracting | Real Estate | Holding and non-transferred activities |
Consolidated total |
|---|---|---|---|---|---|
| Cash flow from operating activities before change in working capital |
449,832 | 24,904 | 29,056 | -6,213 | 497,579 |
| Net cash flow from (used in) operating activities |
595,170 | 44,895 | 24,272 | -35,492 | 628,845 |
| Cash flow from (used in) investing activities |
-632,851 | -21,773 | -2,583 | -5,726 | -662,933 |
| Cash flow from (used in) financing activities |
-53,178 | -8,412 | -24,152 | 31,739 | -54,003 |
| Net increase/(decrease) in cash position |
-90,859 | 14,710 | -2,463 | -9,479 | -88,091 |
| 31 December 2016 In thousands € |
Dredging and Environment |
Contracting | Real Estate | Holding and non-transferred activities |
Consolidated total |
|---|---|---|---|---|---|
| Cash flow from operating activities before change in working capital |
445,608 | 36,663 | 6,522 | -18,050 | 470,743 |
| Net cash flow from (used in) operating activities |
438,036 | 27,857 | 24,243 | -65,522 | 424,614 |
| Cash flow from (used in) investing activities |
-224,867 | -8,612 | 1,294 | 17,681 | -214,504 |
| Cash flow from (used in) financing activities |
-63,218 | -12,136 | -24,361 | 11,020 | -88,695 |
| Net increase/(decrease) in cash position |
149,951 | 7,109 | 1,176 | -36,821 | 121,415 |
On 21 December 2017, CFE Contracting, a subsidiary of CFE, acquired 100% of the shares of the fully consolidated Belgian company Algemene Aannemingen Van Laere. Its assets and liabilities were recognized at the carrying value determined according to the accounting methods of the CFE group. The fair value of the identifiable assets and liabilities was provisionally assessed on 31 December 2017.
The fair values provisionally assigned to the assets and liabilities that were acquired are summarized as follows:
| In thousands € | |
|---|---|
| Intangible assets | 64 |
| Tangible assets | 19,451 |
| Cash and cash equivalents | 12,027 |
| Provisions | -3,216 |
| Current and non current financial debts | -5,117 |
| Deferred taxes | 2,632 |
| Other current and non current assets and liabilities | -8,757 |
| Net assets acquired | 17,084 |
| Goodwill | 0 |
| Purchase price | 17,084 |
The following valuation methods were applied to determine the fair value of the main identifiable assets and liabilities:
On 12 December 2017, CFE Contracting, a subsidiary of CFE, acquired 100% of the shares of the fully consolidated Belgian company José Coghe-Werbrouck NV. Its assets and liabilities were recognized at the carrying value determined according to the accounting methods of the CFE group. The fair value of the identifiable assets and liabilities was assessed on 31 December 2017.
The fair values assigned to the assets and liabilities that were acquired are summarized as follows:
| In thousands € | |
|---|---|
| Tangible assets | 4,415 |
| Cash and cash equivalents | 2,585 |
| Current and non current financial debts | -1,316 |
| Deferred taxes | -355 |
| Other current and non current assets and liabilities | 21 |
| Net assets acquired | 5,350 |
| Goodwill | 2,350 |
| Purchase price | 7,700 |
The following valuation methods were applied to determine the fair value of the main identifiable assets and liabilities:
Taking into account the consideration transferred, the residual goodwill has been estimated at € 2,350 thousand.
The recognition of a residual goodwill is justified by the fact that the CFE group expands its set of competencies and skills in the railway business by incorporating the track-laying activity of the acquired company.
On 31 August 2017, GeoSea, a subsidiary of DEME, acquired 100% of the shares of the fully consolidated company A2Sea A/S. Its assets and liabilities were recognized at the carrying value determined according to the accounting methods of the CFE group. The fair value of the identifiable assets and liabilities was provisionally assessed on 31 December 2017.
The fair values provisionally assigned to the assets and liabilities that were acquired are summarized as follows:
| In thousands € | |
|---|---|
| Tangible assets | 165,888 |
| Other non current assets | 185 |
| Cash and cash equivalents | 37,891 |
| Other current and non current assets and liabilities | 734 |
| Net assets acquired | 204,698 |
| Goodwill | 0 |
| Purchase price | 204,698 |
The following valuation methods were applied to determine the fair value of the main identifiable assets and liabilities:
The fair value assessment of the identifiable assets and liabilities could not be completed within the time limits set by the annual closing. The values assigned to the assets and liabilities that were acquired may still be changed during a period of 12 months after the acquisition date.
In the fourth quarter of 2017, GeoSea, a subsidiary of DEME, acquired 72.5% of the shares of the fully consolidated Belgian company G-tec. Its assets and liabilities were recognized at the carrying value determined according to the accounting methods of the CFE group. The fair value of the identifiable assets and liabilities was provisionally assessed on 31 December 2017.
The fair values provisionally assigned to the assets and liabilities that were acquired are summarized as follows:
| In thousands € | |
|---|---|
| Tangible assets | 20,442 |
| Other non current assets | 274 |
| Cash and cash equivalents | 1,054 |
| Non current liabilities | -14,279 |
| Other current and non current assets and liabilities | -10,040 |
| Net assets (100%) | -2,549 |
| % share acquired | 72.5% |
| Net assets - group share | -1,850 |
| Goodwill | 7,410 |
| Purchase price | 5,560 |
The fair value assessment of the identifiable assets and liabilities could not be completed within the time limits set by the annual closing. The values assigned to the assets and liabilities that were acquired may still be changed during a period of 12 months after the acquisition date.
No significant changes have occurred in the financial and commercial situation of the CFE Group since 31 December 2017.
| In thousands € | 2017 | 2016 |
|---|---|---|
| Turnover | 29,578 | 46,911 |
| Operating income | -31,507 | -8,040 |
| Net financial result excluding non-recurring financial income |
57,681 | 58,969 |
| Non-recurring financial income | 518 | 9,487 |
| Non-recurring financial charges | 0 | -1,541 |
| Result before taxes | 26,692 | 58,875 |
| Taxes | -170 | -17 |
| Result of the year | 26,522 | 58,858 |
The gradual delivery of the latest projects realized by CFE SA mechanically leads to a decrease in its revenue.
The operating income was adversely affected by increases of provisions.
The financial result consists mainly of € 55.0 million and € 6.0 million worth of dividends paid by DEME and CFE Contracting respectively.
In 2016, the non-recurring financial income included the capital gains realized on the disposal of Locorail and Coentunnel Company.
| In thousands € | 31 December 2017 | 31 December 2016 |
|---|---|---|
| Assets | ||
| Fixed assets | 1,325,005 | 1,323,520 |
| Current assets | 155,489 | 236,408 |
| Total assets | 1,480,494 | 1,559,928 |
| In thousands € | 31 December 2017 | 31 December 2016 |
|---|---|---|
| Equity and liabilities | ||
| Equity | 1,163,350 | 1,197,582 |
| Provisions | 81,998 | 57,272 |
| Non-current liabilities | 248 | 132,580 |
| Current liabilities | 234,898 | 172,494 |
| Total equity and liabilities | 1,480,494 | 1,559,928 |
The financial assets for the most part consist of the stakes in DEME, CFE Contracting and BPI.
The bond of € 100 million matures at the end of June 2018. On 31 December 2017, it was reclassified from long-term debts to short-term debts.
The CFE Group will report a substantial revenue growth in 2018, in view of the high order book for both DEME and Contracting.
At the general meeting of shareholders on 3 May 2018, CFE's board of directors will propose a gross dividend of € 2.40 per share, representing a net dividend of € 1.68, or a total distribution of € 60,754,757.
At the end of the financial year, CFE's share capital amounted to €41,329,482.42, divided into 25,314,482 shares, with no declared par value. The Company's shares are registered or in electronic form.
CFE's equity base as of 31 December 2016 was as follows:
| Shares with no par value | 25,314,482 |
|---|---|
| registered shares | 18,552,334 |
| shares in electronic form | 6,762,148 |
Shareholders owning 3% or more of the voting rights relating to the shares they hold:
| Ackermans & van Haaren NV Begijnenvest 113 B-2000 Antwerp (Belgium) |
15,289,521 shares or 60.40% |
|---|---|
| VINCI Construction SAS 5, cours Ferdinand-de-Lesseps F-92851 Rueil-Malmaison Cedex (France) |
3,066,460 shares or 12.11% |
There has been no issue of convertible bonds or warrants.
Degroof-Petercam has been appointed as the 'Main Paying Agent'.
Financial institutions with which holders of financial instruments may exercise their financial rights are: Degroof-Petercam, BNP Paribas Fortis and ING Belgium.
| Ordinary shareholders meeting | 3 May 2018 |
|---|---|
| Publication of interim statements 2018 | 25 May 2018 (before opening of the stock market) |
| Publication of half-year financial statements 2018 | 31 August 2018 (before opening of the stock market) |
| Publication of interim statements 2018 | 23 November 2018 (before opening of the stock market) |
The statutory auditor, Deloitte, Reviseurs d'Entreprises, represented by Michel Denayer and Rik Neckebroeck, has confirmed that it 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. Nevertheless, without qualifying its opinion, the auditor draws attention to the uncertainties as to the payment of the outstanding debts due by the Chadian government and the actions undertaken to facilitate their settlement.
* * *
CFE, founded in 1880 is a Belgian industrial group active in three different divisions. The first, Dredging, Environment, Offshore and Infra, is carried out by its wholly owned subsidiary DEME, one of the world leaders in the field. DEME has a modern fleet of multipurpose vessels equipped with the latest technologies. The second, Contracting, encompasses the group's construction, multitechnics and rail activities in Belgium, Luxembourg, Poland and Tunisia. The third, Real Estate Development, covers the real estate projects developed by BPI in Belgium, Luxembourg and Poland.
The CFE group currently employs more than 8,000 people and is active on every continent. CFE is listed on Euronext Brussels and is 60.40% owned by Ackermans & van Haaren.
This press release is available on our website at www.cfe.be.
* * *
Note to editors
For further information, please contact, at CFE:
- Renaud Bentégeat, Chief Executive Officer, tel.: +32 2 661 13 27, mobile: +32 497 514 445, [email protected]; or
- Fabien De Jonge, Chief Financial Officer, tel. +32 2 661 13 12, mobile +32 497 514 406, [email protected]
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