ANNUAL REPORT 2022

CHAPTER 01 INTRODUCTION

INTRODUCTION .............................................................. 10
DEME'S STRATEGY ........................................................................................ 10
DEME’S TWO-DIMENSIONAL STRATEGY FOR
SUSTAINABLE GROWTH ............................................ 14
OUR MISSION TO CREATE A MORE SUSTAINABLE PLANET ............................................... 14
OUR MISSION .................................................................................................... 16

CHAPTER 02 STRATEGY

STRATEGY FORWARD-LOOKING ...................................................................... 17
DEME'S TWO-DIMENSIONAL STRATEGY FOR
SUSTAINABLE GROWTH ............................................ 18
OUR MISSION TO CREATE A MORE SUSTAINABLE PLANET ............................................... 20

CHAPTER 03 SEGMENTS

SEGMENTS OVERVIEW ................................................................... 24
OFFSHORE ENERGY ....................................................................................... 26
DREDGING & INFRA ........................................................................................ 30
ENVIRONMENTAL ............................................................................................. 38
CONCESSIONS ................................................................................................. 48

All definitions for alternative performance measures (APMs) or acronyms used in this report are available in the Glossary (see the Appendix chapter).

CHAPTER 06 FINANCIAL REPORT

CHAPTER 07 APPENDIX

GLOSSARY ....................................................................................................... 150
INDEPENDENT AUDITOR'S REPORT .......................................................................... 168
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ................................................... 177

CHAPTER 04 CORPORATE GOVERNANCE AND RISK

GOVERNANCE STRUCTURE ............................................................................... 70
REMUNERATION POLICY ................................................................................ 44
DEME'S GOVERNANCE ................................................................................... 44
BOARD OF DIRECTORS ................................................................................... 46
Risk management & control processes ................................... 48
AUDIT COMMITTEE ........................................................................................... 50
REPORT OF THE STATUTORY AUDITOR .................................................................... 54

CHAPTER 05 SUSTAINABILITY & QHSE

SUSTAINABILITY ............................................................................................. 57
DEME’S CONTRIBUTION TO THE UN SDGs ........................................................ 57
SUSTAINABLE DEVELOPMENT GOALS ............................................................... 59
Collaboration with stakeholders ........................................................ 59
OUR VALUES .................................................................................................... 60
OUR PEOPLE .................................................................................................... 61

INTRODUCTION 01CHAPTER

Facing new challenges and achieving our goals are only possible in a safe and healthy working environment. This is my commitment to all our employees worldwide.

NATALIA DE SOUZA SECCO | CHAIRMAN OF THE BOARD OF DIRECTORS

Letter of the CEO & Chairman

DEME has been shaping the world so. We are at the heart of the energy transition, using specialised equipment to construct offshore wind farms worldwide, and at the same time, we are establishing ourselves in the green hydrogen market. In the decades to come we will tackle some of the most important issues our planet faces today: rising sea levels, a growing population, a reduction of emissions, polluted rivers and soils, and the scarcity of mineral resources. Our mission to create a more sustainable planet underlies everything we do, and we are committed to the UN Sustainable Development Goals. In line with this, we have identified eight key sustainability themes where we can really make a difference.

COP27

We were very proud to send a high level delegation to The United Nations climate convention in Sharm el-Sheikh (Egypt). DEME has been a pioneer in the offshore wind industry for more than twenty years, and it is clear at the UN Climate Change Conference that offshore wind is now recognised as a major contributor to solving climate change, alongside other renewables such as green hydrogen.

2022 was a ‘rollercoaster’ year. It has been defined by many elements we can’t control such as geopolitical tensions, rapidly rising inflation, high steel prices and of course, Covid was still with us, although it did not have such a significant influence on our financials this year. The global energy market, however, was dramatically impacted by the conflict between Russia and Ukraine which in turn, is leading to increasing demand for renewable energy and a further push to achieve the clean energy goals as soon as possible.

Record high orderbook and solid turnover growth

Our company has achieved a record high orderbook of €10.6 billion, and have still achieved solid growth in orders is largely being driven by the need to address climate change and the energy transition, driving healthy demand across all of our segments and leading to a 30% increase in turnover.

The growth in turnover was fueled by all segments. Turnover increased by 19% to €4.7 billion, compared to €4.0 billion in 2021. This is an all-time high and showing a clear recovery to pre-pandemic levels. The recovery was mainly fueled by the Offshore Energy and Environmental segments.

Our order intake reached €5.3 billion, which is a significant increase compared to the €4.2 billion in 2021. Undoubtedly, we are living in a transformative century – the drive for sustainability, the rise in digitalisation and the need to combat global warming, are just some of the major factors impacting our business.

LETTER OF THE CEO & CHAIRMAN

DEME ANNUAL REPORT 2022 7

The order intake reached €5.3 billion, compared to €4.2 billion in 2021. This growth was driven by our ability to respond to increasing market demand for our services.

DEME's financial position

DEME’s financial position remains healthy with a net debt position of €2.8 billion (net debt / EBITDA of 2.2) while the company continues to make substantial capital investments in modernising and expanding its fleet in support of future growth.

Segment highlights

We would like to briefly outline some of the highlights and key achievements of our core segments: Offshore Energy, Dredging & Infra, Environmental and Concessions.

Offshore Energy

DEME Offshore had a remarkable year. The Orion, our groundbreaking new vessel, brought a game-changing installation concept to the offshore energy market. In January, the vessel entered the US market. Not only are we about to construct the first wind farms in the US, our activities elsewhere in the world are also intensifying as we secured contracts representing €1.7 billion in Taiwan. Meanwhile, we successfully installed XXL monopile foundations at the Saint-Nazaire offshore wind farm ahead of the planned schedule and despite the fact they were drilled directly into rock. In a demonstration of our cable laying prowess, we were awarded an EPCI contract for the inter-array cables at Dogger Bank C.

Left: Luc Bertrand, Chairman
Right: Luc Vandenbulcke, CEO.

8 LETTER OF THE CEO & CHAIRMAN

Dredging & Infra

The Dredging team continued its strategic projects, resulting in the successful completion of the €600 million LNG terminal in the Elbe. This is the largest dredging and land reclamation project in our history, alongside longstanding maintenance dredging contracts in Europe along the Elbe and Scheldt rivers. We also performed a maintenance project in South Korea for the first time in our history. Our dredging activities were instrumental in the successful completion of the ‘Northern Gate’ access channel to the Szczecin fairway in Poland. Our Infra team also had a busy year as the iconic Western Scheldt Tunnel was completed, and work on the Blankenburg Connection, New Lock Terneuzen and Oosterweel Link continued apace.

Environmental

Our Environmental team has had a very busy year across the board, with large-scale projects such as the dredging of the Port of Ostend and the remediation of contaminated sediments in the Albert Canal in Belgium, and the extensive riverbed remediation in the Thames estuary in the UK.# DEME Environmental

DEME Environmental is setting new standards in the industry, with a focus on evidence-based pollution cleaning method and recently boosted our handling capacity by making additional investments in our soil recycling centres.

Concessions

DEME Concessions was honoured that King Philippe and Queen Mathilde of Belgium attended the official opening of the Port of Duqm and visited HYPORT®, which is our flagship production site for green hydrogen. Many of the segment’s projects support the energy transition and the move to a more sustainable planet. In a remarkable accomplishment, Thistle Wind Partners, a consortium including DEME, was awarded £4.1 billion worth of option areas in the highly competitive ScotWind seabed leasing process, which includes both bottom-fixed and floating wind projects.

GSR

DEME’s major focus is helping to tackle the scarcity of our planet’s resources and GSR is continuing its conscientious research into the possibility of collecting metal-rich, polymetallic nodules from the deep ocean floor.

Well positioned to continue to deliver thanks to our people

We are certainly pleased with the progress we have made and the results achieved. These results position us well to deliver on our strategic ambitions going forward, but we would like to stress that these results are only possible thanks to DEME’s amazingly smart people – the renowned ‘One DEME, One Team’. DEME has a long track record of innovation and sustainable solutions, including the most challenging offshore infrastructure and maritime construction projects in the world. The ability of our employees to keep performing and find innovative solutions is simply astonishing. These projects require a truly committed, highly skilled and experienced workforce, able to continue to deliver what was promised - project after project. Our people are a key asset that support DEME’s leadership position, and these are key for the realisation of our growth ambitions. In addition, DEME’s culture really makes the difference. The famous pioneering spirit leads to innovative solutions and technical leadership, and this is combined with an intense focus on safety, sustainability and working together as one team.

We took an important step when DEME embarked on the next chapter in its long history and became a listed company.

LUC VANDENBULCKE | CEO 2022 DEME ANNUAL REPORT 2022 9

Many of the segment’s projects support the energy transition and the move to a more sustainable planet.

LUC BERTRAND | Chairman 2022

Future-proof fleet

Hand in hand with the ability of our people, is the capability of our fleet. We have set out to create the most modern, sustainable fleet in the industry and have welcomed incredible vessels recently. They are unique in the industry today. In the Offshore Energy segment, our revolutionary offshore installation vessel ‘Orion’ is the first floating monohulled vessel able to perform XXL monopile foundation installation in the offshore wind market. Since delivery it had successfully installed giant monopiles, topsides, a huge jacket and carried out a big decommissioning project. Our pioneering mega cutter suction dredger ‘Spartacus’ has also impressed the dredging industry. 'Spartacus' has more cutting power than any other CSD in the world and has already proven its unrivalled capabilities in terms of production rates, pumping power and ability to cut hard material. This has been coupled with a substantial reduction in fuel consumption per unit of work. ‘Spartacus’ is certainly a wonderful flagship for DEME’s future-proof, sustainable fleet. To make sure we are keeping pace with the rapid growth in the offshore wind market, we have invested in a second huge cable layer – ‘Viking Neptun’ – which recently joined our renowned 'Living Stone'. We are also investing in a giant fallpipe vessel, while our famous sister vessels – ‘Sea Challenger’ and ‘Sea Installer’ – are both being upgraded so they can handle the XXL turbines of the future.

Stock listing and dividend

We took an important step in DEME’s history and went public. We are proud that we have successfully brought DEME to the stock market, particularly that we accomplished this ambition as planned even though we did so in a somewhat volatile and uncertain operating environment. Our decision to bring DEME and CFE to become separately listed companies has been warmly welcomed by our stakeholders. We can now ‘tell our own story’ and drive our strategy and ambitions forward. Our strategy to play a key role in the energy transition and to create a more sustainable world is clear to our stakeholders. It is also rewarding to know we now have the agility to swiftly seize future opportunities and to play a role in creating a better world for generations to come. We remain convinced that our stocklisting is an incredible opportunity for our company, clients, investors, shareholders and our worldwide team of employees.

Confident about our future potential, the board decided to retain most of the financial resources in the company for future investments and to strengthen our balance sheet.

LUC BERTRAND
Chairman
DEME Group

LUC VANDENBULCKE
CEO
DEME Group

Company profile

DEME is a global leader in the fields of dredging, marine infrastructure, solutions for the offshore energy market, and environmental works. We can build on more than 145 years of know-how and experience and have fostered a pioneering approach throughout our history, being a front runner in innovation and new technologies.

145 YEARS OF EXPERIENCE
COMPANY PROFILE
ORDERBOOK TURNOVER PER CONTINENT
Europe 75%
Africa 12%
Asia 8%
Americas 5%
Other 5%
Australia 55%
Middle East 5%
Rest of World 13%
Rest of World 27%
DEME ANNUAL REPORT 2022 55

While DEME’s roots are in Belgium, the company has built up a strong presence in all of the world’s seas and continents. Our vision is to work towards a sustainable future by offering solutions for global challenges: rising sea levels, a growing population, the reduction of emissions, polluted rivers and soils, and the scarcity of mineral resources.

Today, we employ more than 5,000 highly skilled professionals across the globe, and we have a modern, versatile fleet of more than 200 specialised vessels. From our origins in the core dredging business, our portfolio has diversified substantially over the past decades. We have established four segments reflecting our areas of expertise: Dredging, Offshore Energy, Marine Infrastructure, Environmental and Concessions. Our multidisciplinary capabilities and ability to benefit from synergies across these key segments, have enabled us to become a global sustainable solutions provider.

An industry pioneer

DEME is a pioneer, and we believe in turning challenges into opportunities. That’s why we entered the offshore energy market more than 20 years ago, to contribute to the energy transition. Today, this is a major focus and is driving much of our strategy. The expansion of our horizons has led us into sustainable deep-sea harvesting and the green hydrogen sector more recently.

Expanding our geographic presence

Our ambition to play a significant role in the energy transition has led us to expand our presence outside of Europe. We are now preparing to construct offshore wind farms in the USA and Asia.

We continuously strive for operational excellence and greater productivity rates, which is demonstrated by our multi-year fleet investment programme. New vessels such as ‘Orion’ and ‘Spartacus’ have brought an entirely new installation concept to the offshore wind market and unrivalled cutting power to the dredging market.

85 SPECIALISED VESSELS
Active in more than
100 COUNTRIES
5,000 highly skilled professionals
14 INTRODUCTION FINANCIAL & NON-FINANCIAL KEY FIGURES CHAPTER 01

ORDERBOOK
(in million euro)
2021 2022 2020 2019 2018
4,500.1 5,905.2 6,190.0 2,622 2,646

EBIT MARGIN
2021 2022 2020 2019 2018
7.4% 5.4% 2.9% 5.7% 5.8%

TURNOVER
(in million euro)
2021 2022 2020 2019 2018
2,510.6 2,654.7 2,195.8 3,750 4,010

EBITDA MARGIN
2021 2022 2020 2019 2018
17.3% 16.7% 16.8% 18.7% 17.9%

Financial & non-financial key figures
Dashboard financial & non-financial KPIs

EBIT
(in million euro)
2021 2022 2020 2019 2018
143.3 155.2 64.3 141 143

LOST TIME INJURY FREQUENCY RATE
2021 2022 2020 2019 2018
0.19 0.19 0.24 0.21 0.23

CAPITAL EXPENDITURE
(in million euro)
2021 2022 2020 2019 2018
202 282 484 435 441

CONTRIBUTED CAPACITY
(MW Installed foundations)
2020 2021 2022
2,798 1,867 2,499

NET RESULT
(in million euro)
2021 2022 2020 2019 2018
114.6 112.7 50.4 125 156

EBITDA
(in million euro)
2021 2022 2020 2019 2018
469.3 473.9 369.5 459 437

DEME ANNUAL REPORT 2022 15 FINANCIAL & NON-FINANCIAL KEY FIGURES CHAPTER 01

DEME Group key figures

	2022	2021	2020
FINANCIAL KEY FIGURES
(in million euro)
Turnover	2,654.7	2,510.6	2,195.8
EBITDA	473.9	469.3	369.5
Depreciation & impairment	318.7	326.0	305.2
EBIT	155.2	143.3	64.3
Net result from joint ventures and associates	15.8	10.5	22.4
Net result share of the Group	112.7	114.6	50.4
Orderbook	6,190.0	5,905.2	4,500.1
Shareholders' equity (excl.

DEME ANNUAL REPORT 2022

Financial and non-financial key figures

	2022	2021	2020
minority interests)	1,753.9	1,579.5	1,476.5
Net financial debt	-520.5	-392.7	-489.0
Operating working capital	-506.2	-511.1	-552.3
Balance sheet total	4,509.8	4,049.6	3,919.9
Investments	483.9	282.0	201.6
Earnings per share (in euro)	4.45	4.53	
Dividend for the year per share (in euro)	1.5		
Total cash	522.3	528.6	621.9

NON-FINANCIAL KEY FIGURES

	2022	2021	2020
Average # personnel (based on FTE)	5,153	4,880	4,976
Ratio male/female	85/15	85/15	85/15
Number of nationalities	79	80	80
Worldwide Lost Time Injury Frequency Rate (WW LTIFR - 'Safety thermometer')	0.23	0.19	0.19
Low carbon fuels (% low carbon fuels versus total consumed fuels (energy based))	6.0%	N/A 	N/A 
GHG emissions worldwide in kt CO2e (Scope 1&2)	653	833	660
Contributed capacity (MW Installed foundations)	2,798	1,867	2,499
MW Installed Wind Turbines	440	2,378	1,477
MW Beneficial Ownership	144	144	144
Number of approved innovation initiatives	12	14	18
Number of green initiatives	127	125	128
Fleet utilisation rate of Trailing Suction Hopper Dredgers (in weeks)	38.3	42.2	37.5
Fleet utilisation rate of Cutter Suction Dredgers (in weeks)	29.3	25.3	10.5
Fleet utilisation rate rate of Offshore equipment (in weeks)	33.6	42.1	42.0
EU Taxonomy - Turnover - Eligible activities	29%	28%	N/A
EU Taxonomy - Turnover - Aligned activities	26%	24%	N/A
EU Taxonomy - CapEx - Eligible activities	52%	32%	N/A
EU Taxonomy - CapEx - Aligned activities	52%	32%	N/A

  

DEME ANNUAL REPORT 2022

Financial & non-financial key figures

	2022	2021	2020
Turnover	2,654.7	2,510.6	2,195.8
Offshore Energy	957.8	916.4	962.0
Dredging & Infra	1,524.3	1,478.3	1,151.6
Environmental	206.3	166.2	140.0
Concessions	2.2	1.5	2.1
Reconciliation	-35.9	-51.7	-59.9
EBITDA	473.9	469.3	369.5
Offshore Energy	221.9	170.9	145.5
Dredging & Infra	254.9	305.8	181.3
Environmental	25.0	16.8	16.4
Concessions	-12.7	-12.5	38.3
Reconciliation	-15.2	-11.7	-12.0
EBIT	155.2	143.3	64.3
Offshore Energy	117.1	74.6	34.4
Dredging & Infra	44.9	74.0	-12.1
Environmental	16.5	8.8	6.8
Concessions	-12.7	-12.6	38.3
Reconciliation	-10.6	-1.6	-3.1
Net result from joint ventures and associates	15.8	10.5	22.4
Offshore Energy	0.0	0.0	0.0
Dredging & Infra	0.1	0.0	-0.2
Environmental	0.5	0.6	0.3
Concessions	9.3	11.1	21.3
Reconciliation	5.9	-1.1	1.1
Orderbook	6,190.0	5,905.2	4,500.1
Offshore Energy	3,260.9	2,816.6	1,133.5
Dredging & Infra	2,615.7	2,833.3	3,176.5
Environmental	313.4	255.3	190.1
Concessions	-	-	-



DEME CONCESSIONS AWARDED 2 GW OF SCOTWIND’S OPTION AREAS

Thistle Wind Partners, a consortium   ScotWind’s seabed leasing process. The consortium is allocated two  and floating foundations.

 TRANSFORMED

In the largest rehabilitation project in the Port of  the transformation of Fort Sint-Filips is successfully completed by DEME Environmental and its partners.

‘ORION’ BRINGS GROUNDBREAKING INSTALLATION CONCEPT TO THE OFFSHORE ENERGY MARKET

Revolutionary offshore installation vessel ‘Orion’ enters the fleet and is the first floating monohulled vessel able to perform XXL monopile foundation installation operations in the offshore wind sector.

Highlights 2022

 HIGHLIGHTS 2022
 ANNUAL REPORT 2022 
PORT EXPANSION AND COASTAL DEFENCE PROJECT IN ITALY

 coastal defence works in the Port of Livorno is awarded to a joint venture, including DEME’s Italian subsidiary. This project   of new port areas.

DRILLING AN ENTI_TIRE WIND FARM INTO ROCK

 TECHNOLOGY

 an impressive feat in France when it drills the monopiles into hard rock using industry-first technology at Saint-Nazaire.

P FA S C L E A N I N G CAPACITY BOOSTED AT D E M E RECYCLING CENTRES

DEME has the capability to process  hybrid soil washing process we jointly developed with partner companies.  centres in Belgium will enable us to 

LISTING ON EURONEXT BRUSSELS

In June, DEME takes a major step in its history when it becomes a listed  This move gives the Group direct visibility and enables us to drive our strategy and ambitions forward.

MEGA CUTTER SUCTION DREDGER ‘SPARTACUS’ PROVES ITS CUTTING POWER

 new mega cutter suction dredger ‘Spartacus’  this project would have had to be performed using drilling and blasting techniques.

 INAUGURATED AT 

The public-private-partnership SEMOP Port-La Nouvelle, including DEME Concessions,  The consortium’s ambition is to develop Port-La Nouvelle as a sustainable green port, including establishing a strategic hub for offshore and floating wind.



SOLID PROGRESS AT THE FEHMARNBELT TUNNEL

DEME is proud to be part of the team constructing the Fehmarnbelt Tunnel, which is set to be the longest immersed road and rail tunnel in the world. Known as the ‘infrastructure project of the century’, work is solidly progressing.

CONTRACTS REPRESENTING 1 GW FOR HAI LONG WIND FARMS IN TAIWAN

DEME secures contracts representing 1 GW for the Hai Long wind farms in Taiwan. This milestone deal between CSBC-DEME Wind Engineering and Hai Long Offshore Wind covers the transport and installation of the foundations, turbines and substation.

SUSTAINABILITY EFFORTS RECOGNISED WITH TRENDS GLOBAL IMPACT AWARD

DEME is named a winner of the Trends Global  sustainable value for society. To win this award DEME is deemed to have gone ‘above and beyond’ the conventional targets, such as a climate-neutral or energy-efficient policy.

 ANNUAL REPORT 2022 

DEME PEOPLE MAKE THE DIFFERENCE

We know we have the top people in the business able to find innovative solutions for our customers.

 highly skilled professionals
79 different nationalities among crew and staff
 of DEME staff received compliance training

DEME ANNUAL REPORT 2022 

The collective creative brainpower of our  how we make the difference, and this is why we dare to pioneer. We know we have the top people in the business able to find innovative solutions for our customers that have never been seen before. DEME recognises that these talented people are very much in demand. Therefore, we put a lot of effort into attracting and retaining our workforce. Once people come on board, we want them to stay on board. Because of our diversified portfolio, we truly believe that we can offer and accommodate a lifelong career at DEME.

Attracting the best people in the industry

We launched our employer branding campaign with the tagline ‘Where   of a pioneering company working towards a sustainable future by offering solutions for global challenges. Given our sustainability ambitions, employees get the chance to literally change the world, whether this is building offshore wind farms to bring renewable energy to millions of homes or constructing a new port to stimulate economic growth and international 

A lifelong career

We have a number of initiatives in place, targeted at creating transparency and making it possible for people to ‘drive their own career’. Our DEME career  overview of all staff jobs within the company - is a step in the right direction. Internal mobility and growth are of course supported by a wide range of educational and training possibilities.

Health & wellbeing

For DEME it is important to provide a multicultural and inclusive working environment and we put every effort into ensuring that people are safe and well, both physically and mentally. In the past year we investigated the needs of our workforce, and we are set to launch  & wellbeing and diversity & inclusion. Both challenges and opportunities await anyone that joins DEME and that is what makes a DEME career so  contribute to a more sustainable planet, there is no doubt that the ‘One DEME, 

DEME people make the difference

DEME people are special: pioneering, determined, but at the same time,   industry, without our talented people DEME would not be able to accomplish the complex and challenging projects it does each day.

STRATEGIC PILLARS

SAFETY

The personal safety and health of employees and stakeholders is our greatest priority. Everyone has the right to work in a safe and risk-free environment at all times.

TECHNICAL LEADERSHIP

With an open mind and the right team spirit, we continue to improve all aspects of our work process and develop trailblazing solutions to address the needs and challenges of our customers.

RESPECT & INTEGRITY

Individuality and diversity are valued and performance is recognised. Our relationships with suppliers, subcontractors and partners reflect respect, understanding and sound business practice. We observe all applicable laws and regulations in the countries where we are active.


We respect human rights and prohibit discrimination. DEME core values DEME's core values demonstrate our commitment to consistently deliver excellence to our customers and value to our company. We also expect suppliers, subcontractors and partners to adhere to these standards. At DEME, I NNOVATION Innovation is the cornerstone of our achievements. We continuously push our boundaries by developing new, value-adding services and solutions. VALUE CREATION We make result- and sustainability- driven decisions in order to ensure long-term growth for the benefit of employees, customers and shareholders. This includes strict financial governance to keep our company healthy. ENVIRONMENT We protect the environment and the communities in which we do business by limiting our impact and by working towards sustainable value creation together with our stakeholders.

VESSELS DEDICATED TO OFFSHORE ENERGY

CUTTER SUCTION DREDGERS

TRAILING SUCTION HOPPER DREDGERS

SPECIALISED VESSELS

DEME fleet

DEME is the proud owner of the most versatile fleet in the industry after we embarked on an ambitious fleet investment program, which ensures we stay well ahead of the game. We now have more than 100 vessels in our modern fleet, allowing us to offer the optimal solution for our customers’ projects worldwide. This includes groundbreaking vessels such as ‘Orion’, which brought a game-changing installation concept to the offshore energy market, and ‘Spartacus’, the most powerful mega cutter suction dredger in the world. Offshore installation vessel ‘Green Jade’ will be equipped with a 4,000- tonne crane.

DEME FLEET
DEME ANNUAL REPORT 2022

DEME’s revolutionary offshore installation vessel ‘Orion’ heralds a new era in the offshore wind industry. With a weight of 19,380 tonnes, the vessel made history on entering the market as it performed DEME’s first floating monopile installation ever to take place. ‘Orion’ is built to handle the coming generations of turbines and foundations, and in line with this, it is equipped with a 4,000 tonne, state-of-the-art, engineered integrated motion compensated pile gripper. This tool enables the crew to upend the monopiles, which are transported horizontally on deck, and keep them vertical and stable during installation, despite motions, waves and currents. With a total installed power of 44,180 kW, the vessel has a huge, unobstructed deck and a deadweight that has been increased to accommodate the heaviest components.

Besides the monopile foundation installation in the world, the new vessel also proved its capabilities on various other projects. In 2022, ‘Orion’ was deployed on a series of projects in the North Sea and the Baltic Sea. The vessel successfully installed giant monopiles, topsides, a huge jacket and it had carried out a major decommissioning project in the North Sea. With DEME’s ambition to have the most sustainable fleet in the industry, these considerations are a vital part of the vessel’s design. ‘Orion’ has dual fuel engines, capable of running on the cleanest fuels available, a Green Passport, Clean Design notation and a waste heat recovery system.

The new built vessel, capable of 1,500 tonnes of dynamic load, is prepared for the US market. ‘Green Jade’, built by the joint venture CSBC-DEME Wind Engineering (CDWE), is an equally impressive new floating offshore installation vessel and is on course for delivery this year.

With a 4,000 tonne crane, the newbuild vessel is designed to work in deeper waters and challenging seabed environments such as those found in Taiwan. ‘Green Jade’ is the first offshore installation vessel designed and built in Taiwan and already has its first projects lined up, including the Hai Long offshore wind farm. ‘Orion’ worked on a series of projects in 2022 and heralded a new era in the offshore wind industry.

DEME FLEET
DEME ANNUAL REPORT 2022

Sea Installer
DEME’s sister vessels – ‘Sea Installer’ and ‘Sea Challenger’ – are both being upgraded with a new 5,000 tonne crane to handle the XXL turbines of the future. ‘Sea Installer’ was the first to be upgraded, which mainly included a significant increase in capacity by adding a new 500 tonne heavy lift crane and pedestal, and a considerable extension of the vessel’s accommodation, which can now house 100 people. It is about to set off for the Vineyard Wind 1 project in the US, the first large-scale offshore wind farm in the US. ‘Sea Challenger’ will be reflagged and wil join Japan Offshore Marine (JOM), the DEME Offshore and Penta- Ocean Construction joint venture in Asia.

Vessels

Heavy-lift vessel

In a major step, DEME decided to add a specialised offshore installation vessel to its fleet by purchasing and converting a bulk carrier into a crane vessel. The vessel, with a length of 217 meters and a width of 44 meters, will be the largest in the sector, boasting an enormous payload of 10,000 tonnes. The vessel will be deployed for the installation of offshore wind farms. Currently, the bulker is undergoing conversion at the Ocean Shipyards in Singapore. This includes a new powerplant and propulsion system, as well as an upgrade of the accommodation and the construction of a new bridge. The new fallpipe vessel was renamed 'Yellowstone' following a competition whereby DEME employees submitted their suggestions. Fully compliant with the latest emission standards, the fallpipe vessel will also be the first in the fleet to be prepared for (green) methanol and it will be the first dual fuel fallpipe vessel in the industry. When using green methanol, it is possible to realise DEME’s ambition of a net zero GHG vessel, which is in line with the company’s ambitions to be a frontrunner in the energy transition. Moreover, this vessel has a hybrid power plant with a 1 MWh Li-ion battery, which will lead to benefits similar to those of the hybrid ‘Viking Neptun’.

Besides the upgrade of the vessel with Selective Catalytic Reduction technology, making it TIER III compliant. 'Yellowstone' is equipped with a central 1,200 tonne crane in order to allow pre- and post-lay activities using rocks with larger diameters close to subsea structures. This inclined fallpipe is designed for rock dumping and gravel dumping, making it ideal for the renewables sector. 'Yellowstone' is set to join the DEME offshore fleet in 2023.

Heavy-lift Vessels: ‘Sea Installer’ and ‘Sea Challenger’

Group Performance 2022

Quote of the CEO

“In 2022, despite the background of geopolitical tensions, rapidly rising inflation, high steel prices and challenges associated with the pandemic, we performed well. In addition we became a publicly traded company, providing greater visibility and support for our strategy.

Today, the company is in a strong position to strengthen our industry leadership and successfully diversify our growth opportunities, based on the strength of our dedicated people and outstanding fleet. Today, we have a record high orderbook fueled by a growing global interest in addressing climate change and making the transition to clean energy.”# Executive Summary

DEME achieved two records in 2022. It boosted its orderbook by 15% to €14.5 billion and grew its turnover by 6% to €2.7 billion. The Dredging & Infra and Offshore Energy segments both recorded a higher turnover. Offshore Energy achieved several key milestones, including the installation of the largest ever monopile foundations installed in Europe and the completion of an offshore wind farm on a rocky seabed, both industry firsts and demonstrating DEME’s technical and engineering expertise. Dredging & Infra slightly improved its performance despite challenging geopolitical conditions. The associates in DEME’s concession segment reported slightly softer net results due to lower wind in the offshore concessions but was awarded a permit for the development of the largest offshore wind farm in Scotwind seabed leasing process.

While Dredging & Infra remained profitable with a turnover of €2.7 billion, the segment’s performance was impacted by high fuel costs and demurrage charges. This was offset by strong results in Offshore Energy and Environmental.

DEME’s financial position remains healthy with a net debt position of €0.5 billion while the company continues to make substantial capital investments in support of future growth.

HIGHLIGHTS FINANCIAL YEAR 2022

Turnover increased by 6% to €2,654.7 million compared to €2,510.6 million in 2021, reflecting continued healthy demand, strong market positioning and sizeable wins mainly in the Offshore Energy segment.
EBITDA increased by 1% to €473.9 million compared to €469.3 million in 2021, with growth in all segments.
Net profit amounted to €112.7 million compared to €114.6 million in 2021, impacted by a combination of a higher number of vessel dockings and overhauls, inflation, consumables and commodity price increases.
Net debt amounted to €504.5 million compared to €755.3 million in 2021.
The orderbook reached a record €14.5 billion compared to €12.6 billion in 2021.
Investments in the fleet amounted to €1,085.8 million compared to €747.6 million in 2021.
The company was awarded a permit for the development of the largest offshore wind farm in Europe.
DEME’s Board of Directors will propose a dividend of €0.40 per share.

GROUP PERFORMANCE 2022



Turnover (in million euro)
	2022	2021	2020	FY22 VS FY21
Group	6,190.0	5,905.2	4,500.1	+5%
Turnover (in million euro)
Offshore Energy	3,260.9	2,816.6	1,133.5	+16%
Dredging & Infra	2,615.7	2,833.3	3,176.5	-8%
Environmental	313.4	255.3	190.1	+23%
Concessions (in nominal value)
Europe	55%	62%	74%	-9%
Africa	5%	7%	17%	-26%
Asia	13%	6%	8%	+134%
America	27%	25%	0%	+16%
Middle East	0%	0%	1%	≈
Turnover (in million euro)
Orderbook 2021	2,021.2	1,456.9	1,079.1	1,348.0
Orderbook 2022	2,307.5	1,612.4	1,448.2	821.9

DEME’s orderbook reached a record €14.5 billion compared to €12.6 billion in 2021 and €10.1 billion in 2020. The overall orderbook at year end was €14.5 billion, representing 5.4 years of work. This increase was led by strong demand in both the Environmental and the Offshore Energy segments, the latter including the addition of major long-term projects in South-East Asia, Australia and the United States. From a geographical perspective, the orderbook in Asia and America increased significantly compared to 2021, while Europe continues to account for more than half of the orderbook.

Outlook

The following statements are forward looking, and actual results may differ materially. Given the robust demand trends across the business, in particular the Offshore Energy segment, management is confident about DEME’s long-term growth prospects and expects to see a gradual increase in turnover supported by the current backlog and current and projected fleet capacity. In light of the project-based nature of many of DEME’s activities, management expects EBITDA to vary somewhat but to stay within €450-€500 million based on present market conditions, current orderbook and fleet capacity, compared to €473.9 million in 2022 and €469.3 million in 2021. The growth in EBITDA is anticipated to be moderate in 2023 compared to 2022.

Dividend

DEME’s Board of Directors will propose a dividend of €0.40 per share. Subject to the approval of the General Meeting of Shareholders and the Board of Directors, the record date is April 26, 2023.

Turnover

Year-over-year comparison (in million euro)

	2022	2021	2020	FY22 VS FY21
Offshore Energy	957.8	916.4	962.0	+5%
Dredging & Infra	1,524.3	1,478.3	1,151.6	+3%
Environmental	206.3	166.2	140.0	+24%
Concessions	2.2	1.5	2.1
Total turnover of segments	2,690.6	2,562.3	2,255.7
Reconciliation	-35.9	-51.7	-59.9
Total turnover as per financial statements	2,654.7	2,510.6	2,195.8	+6%

Geographical breakdown (in nominal value)

	2022	2021	2020	FY22 VS FY21
Europe	75%	74%	83%	+7%
Africa	12%	19%	6%	-35%
Asia	8%	5%	9%	+96%
America	5%	2%	2%	+195%
Middle East	0%	0%	0%	≈

Total turnover of segments increased by 5% year-over-year, while revenue for the Dredging & Infra and Environmental segments increased by 3% and 24% respectively.

Despite the Russia-Ukraine conflict, the Dredging & Infra segment made a positive performance. The Environmental segment grew mainly in Belgium and France on work performed on soil remediation and treatment projects.

From a geographical perspective, turnover in Asia and America increased significantly, while Europe continues to account for three quarters of the turnover.

GROUP PERFORMANCE 2022


EBITDA (in million euro)
	2022	2021	2020
EBITDA	473.9	469.3	369.5	+1%
EBITDA margin	17.9%	18.7%	16.8%
EBIT	155.2	143.3	64.3	+8%
EBIT margin	5.8%	5.7%	2.9%
Net profit	112.7	114.6	50.4	-2%
Net margin	4.2%	4.6%	2.3%

Net profit amounted to €112.7 million compared to €114.6 million in 2021. The decrease was mainly due to a combination of a higher number of vessel dockings and overhauls, inflation, consumables and commodity price increases. The performance however was different segment by segment with the Offshore Energy segment posting a net profit of €60.6 million, the Dredging & Infra segment posting a net profit of €55.5 million and the Environmental segment posting a net profit of €30.5 million.

EBITDA remained stable at €473.9 million. This was impacted by higher operating expenses, particularly fuel costs, and lower other income. The €16.8 million in liquidated damages received as compensation for the incremental costs incurred as a result of the late delivery of the ‘Orion’ (Offshore Energy segment) was offset by liquidated damages for ‘Spartacus’ (Dredging & Infra segment).# Relevant Market Drivers

01 REDUCING EMISSIONS & TACKLING CLIMATE CHANGE

The drive to achieve the ambitious climate targets set by the Paris Agreement is becoming more urgent as countries try to slow global warming and move away from fossil-based fuels. The clean energy transition is seeing increasing demand for offshore wind energy and a focus on the importance of future fuels such as green hydrogen.

In addition, the Group takes a keen eye on global megatrends and the impact these have on our activities. The Group’s management team is therefore constantly analysing new trends and their impact on DEME’s strategic position.

02 GROWING POPULATION & URBANISATION

The world population is growing and is expected to reach 9.7 billion by 2050. In addition, 70% of the world population lives within 100 km of the coast and most major cities are located in low-lying coastal areas that are less than 10 m above sea level, leaving them highly vulnerable to sea-level rise and other weather events such as storm surges. This means that flood defence solutions are vital and will become even more important in the future.

The increasing pressure on land means that it is necessary to invest in land reclamation and new infrastructure.

03 GLOBALISATION AND THE GROWTH IN WORLD TRADE AND ITS IMPACT ON MARINE INFRASTRUCTURE

Over the past decades, globalisation has led to a substantial increase in international trade between countries worldwide. As a result, global supply chains and trade routes are developing, and new ones are being created as geopolitical and macro-economic forces shift current trading patterns. This requires significant investment in maritime infrastructure, ports and the widening of their access channels and other maritime services. A major trend is that vessels – whether containerships, bulkers or tankers – are getting bigger. Berths, fairways and turning basins have to be dredged and widened to accommodate the new generation of vessels.

04 RISING SEA LEVELS & EXTREME WEATHER EVENTS

With much of the world’s population located along the coast and global warming leading to rising sea levels and more extreme weather events, the demand for coastal protection works is increasing, and there is a growing sense of urgency. DEME has been applying its proven coastal protection solutions for decades and in line with its sustainability goals, it is also looking for possibilities to use nature-inspired solutions. These replace traditional hard-engineering, coastline and river embankment management methods and instead aim to develop circular, Nature-based Solutions.

05 SCARCITY OF MINERAL RESOURCES & INCREASING ELECTRIFICATION

The growth in the world’s population, urbanisation, increasing wealth and the energy transition are leading to unprecedented demand for electrification and in turn, the demand for minerals. Many of today’s clean energy technologies are reliant on the plentiful supply of critical minerals.

For example, the extraction of cobalt, a key component in batteries, requires responsible sourcing. For example, DEME acknowledges the growing demand for minerals and is researching the possibilities to responsibly collect metal-rich, polymetallic nodules from the deep ocean floor and believes that these nodules could become an important source of high-grade, low carbon critical minerals.

06 TACKLING POLLUTED SOILS & THE NEED TO CREATE AND PROTECT LAND

It is even more important today to value precious land resources and as the population continues to grow the demand for new residential or industrial areas will only continue. Therefore, it is crucial to be able to remediate polluted brownfield sites and give them a valuable new purpose. With the increasing focus on promoting a sustainable and circular economy, it is essential to clean and reuse as much of the contaminated soil and dredged material as possible.

DEME’S 2030 STRATEGY

DEME’s 2030 Strategy

DEME is a leading marine solutions provider, active in the fields of dredging and marine infrastructure, offshore energy and environmental remediation. DEME aims to make the world a better place by working towards a net zero future, addressing global challenges including climate change, energy transition, a growing population, polluted rivers and soils, and the scarcity of mineral resources. DEME focuses on marine and geo-engineering innovations and solutions linked to water and soil, delivering projects in a reliable, sustainable and efficient way. DEME can therefore rely on its team of more than 5,400 professionals and operates one of the largest and most technologically advanced fleets in the world.

Our strategic ambition is to:

Be a reliable, and sustainable global leader in marine solutions and
Pursue a focused and diversified expansion strategy and asset-related innovation and investments anticipating the megatrends of the future.

DEME’S 2030 STRATEGY

DEME will deliver on its strategic ambition and further strengthen its position as a leading marine solutions provider and will pursue its vision, building on the following strategic enablers.

01 RELIABLE SOLUTION PROVIDER

02 OPERATIONAL EXCELLENCE

03 HEALTHY BALANCE SHEET

04 INNOVATION & INVESTMENTS

05 SUSTAINABILITY

ASSET RELATED INNOVATION & INVESTMENTS

Innovation and investments give DEME the competitive edge and positions the company as a front runner. DEME is considered one of the most technologically advanced companies in the industry. This is the outcome of a multi-year fleet, and a pioneering spirit that enables us to provide new concepts that have never been seen before. This powerful combination allows DEME to deliver on the most demanding projects. To further strengthen this capability, DEME will continue to invest in the following domains:

5G: Smart shipping, autonomous shipping, remote operations, etc. We will leverage our capabilities & people
Circular economy: New investments in the circular economy, as well as in sustainable infrastructure in a balanced way to capture the growth opportunities
Asset portfolio: Optimise our asset portfolio to strengthen the position of our contracting segments and increase recurring revenues and profits
New Initiatives: Smart, innovative, and groundbreaking initiatives such as deep-sea mineral harvesting, green hydrogen and other advanced initiatives with a view to future proofing our fleet.

FOCUS ON STRATEGIC CHOICES & OPERATIONAL EXCELLENCE

Today, the company is already organised around optimising its business processes and operational excellence, and DEME wants to further pursue this trajectory.

Thus, the company wants to balance its resource allocation (capital investments and human capital development) and as a result, wants to wisely spend the available resources and invest in the right initiatives to fuel growth and further strengthen the leadership position of DEME.

02 A SEASONED, HIGHLY SKILLED AND COMMITTED WORKFORCE MAKING THE COMPANY A RELIABLE SOLUTION PROVIDER

DEME is a proven, reliable solutions provider and delivers what was promised. Our track record of successful project execution, combined with our company culture of resilience, adaptability and commitment to our customers, are key factors in our success. This is how DEME can and will continue to be a reliable partner for its clients and the world today.# DEME ANNUAL REPORT 2022

01 A HEALTHY BALANCE SHEET SUPPORTING INVESTMENT STRATEGY

Disciplined capital allocation policy, the company has a healthy balance sheet and a conservative debt level, allowing to continue to invest in its mid and long term future, and to move swiftly when opportunities arise.

05 SUSTAINABILITY AT THE CORE OF WHAT WE DO

DEME positions ESG and safety at the core of all of its activities. Our sustainable strategy is based on two pillars.

EXPLORE sustainable business solutions.
EXCEL in our operations by maintaining and strengthening our sustainable performance.

We outline DEME’s sustainability strategy in more detail later in this chapter.

DEME’s two-dimensional strategy for sustainable performance

EXPLORE SUSTAINABLE BUSINESS SOLUTIONS
EXCEL IN OUR OPERATIONS

This strategy will help us to create sustainable value for our customers, DEME and society. At DEME, it is our ambition to fundamentally contribute to sustainable solutions for the global environmental, societal and economic challenges facing our world today.

We continually strive to improve the sustainability of our own operations. This has led to our two-dimensional strategy for sustainable performance – we aim to EXPLORE and to EXCEL.

TO EXPLORE SUSTAINABLE BUSINESS SOLUTIONS by continuously challenging ourselves to enlarge our sustainable business portfolio and to align our business decisions with the Sustainable Development Goals where DEME can create the most impact.

The SDGs provide us with a framework and a source of inspiration.

TO EXCEL IN OUR OPERATIONS by maintaining and strengthening a sustainable performance in our daily operations. We refer to chapter 5 [link to information].

DEME’S SUSTAINABILITY STRATEGY

It is undeniable that the world is facing multiple global challenges that could have a serious impact on society and the environment unless we act. The United Nations’ Sustainable Development Goals (SDGs) provide us with a common framework and language for these global challenges. While these goals address different themes and aspects of sustainability, they are all interconnected. Together, they will help us to overcome global poverty, stop climate change and fight inequality so that we all live in a better world.

As a purpose-driven company, DEME wants to contribute to achieving the SDGs. These goals have helped us to understand the economic, environmental and social impact of our operations as we move towards a project portfolio with a strong sustainable focus. DEME does not contribute to all of the goals equally, instead we focus on those where we can make the most impact.

The SDGs provide us with a framework and a source of inspiration.

We focus on the implementation of our two-dimensional strategy for sustainable performance, based on the SDGs.

DEME's Materiality Matrix 2022 highlights our most material topics.

DEME’S 8 KEY SUSTAINABILITY THEMES AND THEIR CONNECTION WITH THE RELEVANT SDG s.

DEME’S SUSTAINABILITY STRATEGY

During 2022 we updated our Materiality Matrix. We conducted a materiality assessment to ensure we prioritise the issues that have the biggest impact on our business, and that matter most to our stakeholders.

TO DO SO WE:

Mapped the most relevant topics for DEME and its stakeholders.
Conducted a sector and company-specific ESG materiality analysis to identify these within our sector and relevant ESG topics used by risk rating agencies;
Used a stakeholder engagement approach to define the risk category, and
Applied a scoring methodology to better quantify the potential impact of DEME’s ESG risks;
Compiled the results in the updated Materiality Matrix and validated these results through our governance model.

Importance to stakeholders	Impact on DEME business
High	High
Workplace diversity and inclusion	Climate and Energy
Health & wellbeing	Resilient infrastructure
Responsible business conduct	Energy efficiency
Corporate & ESG governance	GHG emissions
Biodiversity
Resource management
Supply Chain
Land restoration
Air pollutants
Talent management
Partnerships
Safety
Sustainable innovation
Energy transition
Local community engagement

DEME’S SUSTAINABILITY STRATEGY

DEME's Materiality Matrix 2022 as its most material topics.


CLIMATE AND ENERGY	E	E	E
Energy transition	To expand our offshore renewable energy solutions and to explore new marine-based solutions for renewable energy production, connection and storage.	MW Installed wind turbines	440
		Contributed capacity MW	2,798
		Beneficial Ownership	144
			2,378
			1,867
			144
			1,477
			2,499
			144
Resilient infrastructure	To build resilient marine infrastructure, such as the construction of ports, locks, tunnels and bridges and to provide dedicated flood protection solutions and coastal protection management.	Turnover (% eligible; % aligned)	29; 26
		CapEx (% eligible; % aligned)	52; 52
		OpEx (% eligible; % aligned)	0; 0
			28; 24
			32; 32
			0; 0
			-
			-
			-
Energy efficiency	Climate-neutral operations by 2050 and improvement of energy efficiency in our operations.	kt of emitted CO₂ worldwide (BE)	653
			833
			660
GHG emissions	To reduce greenhouse gas emissions by 40% by 2030 relative to 2008 per unit of work.	Sustainability linked loans target 2025	50%
		% Low carbon fuels versus total consumed fuels (energy based)	6.0
			-
			-
HEALTH AND WELLBEING	S
Safety	To provide a safe, secure and healthy working environment for all people involved.	Worldwide Lost Time Injury Frequency Rate - target <= 0.20 (Sustainability Linked Loans)	0.23
		Worldwide Lost Time Injury Frequency Rate ('Safety thermometer')	0.9
			0.19
SUSTAINABLE INNOVATION	G
Sustainable Innovation	Enhance scientific research, upgrade technological capabilities and encourage sustainable innovation within our projects.	Sustainability integrated in each innovation campaign, as part of the evaluation criteria and incorporated in the innovation stage gate process.
		Number of approved innovation initiatives	12
			14
			18
ETHICAL BUSINESS	G
Responsible business conduct	Respect and protect labour rights in our organisation. Embed an ethical mindset within DEME and transparently communicate about our ethical performance. To ensure every employee has followed frequent training courses about ethical awareness.	% DEME staff that received DEME Compliance Awareness training	99
			99
			97

INNOVATION IS AT THE HEART OF DEME

The world’s most powerful cutter suction dredger ‘Spartacus’ embodies DEME’s innovative spirit.

DEME’s strategic focus on innovation is realised through two main innovation programmes: the Innovation & Development programme, which focuses on disruptive and transformational innovation, and the Diver campaign, whereby the DEME community contributes hundreds of new ideas to our Innovation team. If these ideas are identified as having potential on a commercial, technical and sustainable level, DEME will invest and develop them, allowing us to seize opportunities at an early stage and obtain first-mover advantage.

We have a radical approach to disruptive innovation and looking beyond what is possible now, instead focusing on what is possible in two to three decades. Our innovative programmes have led to moves into the fledgling green hydrogen market and development of new energy sources and technologies.

Our innovative spirit means that we can bring groundbreaking concepts to the industry that boost performance, efficiency and sustainability such as DEME Offshore’s vessel ‘Orion’ which can perform floating XXL monopile installation. It is equipped with an integrated motion compensated pile gripper that was the brainchild of DEME’s engineers. This unique tool enables the crew to upend the monopiles and keep them vertical and stable during installation, despite currents and waves.

INNOVATION IS AT THE HEART OF DEME

DEME is renowned for being at the forefront of innovation, which enables it to contribute to sustainable growth and create new opportunities. Innovative thinking is embedded in our organisation, and we have various initiatives underway which empower our employees to become thought-leaders in the industry.

Boosting performance, efficiency and sustainability

DEME’s new mega cutter suction dredger 'Spartacus' - boasting 34,000 kW on the cutterhead - is able to achieve unrivalled production rates.

Before 'Spartacus’, the rock would have been dealt with using drilling and blasting. This is why we are very proud of this achievement. The vessel has an impressive sustainability profile, achieving significant fuel savings per cube dredged.

In line with its strategy, DEME Offshore drilled an entire wind farm into rock using industry-first technology at the Saint-Nazaire offshore wind farm. If suitable equipment was not available in the market, therefore DEME Offshore manufactured its own. Together with its partner Herrenknecht, it jointly designed a special drill for the occasion.

HYPORT® Duqm is another good example of DEME’s drive to innovate and pioneer.# DEME ANNUAL REPORT 2022

In order to support the clean energy transition DEME Concessions and its partner are developing an industrial-scale, green hydrogen plant in Duqm. We are at the cutting edge of this rapidly growing sector. Meanwhile, Global Sea Mineral Resources (GSR), DEME’s deep-sea company, is continuing to progress with its ambition to responsibly collect polymetallic nodules from the seabed. The GSR team successfully tested its pre-prototype nodule collector, the ISM, with its own integrated drilling and sampling equipment. DEME Environmental is using innovative evidence-based dredging and soil remediation solutions on projects and our subsidiary de Vries & van de Wiel has developed a pioneering hybrid soil washing installation with its partner Tauw. The soil washing process achieves a cleaning efficiency of over 95% for contaminated soil.

Innovative fleet

Key risks

01 DEME’S BUSINESS AND GROWTH OPPORTUNITIES ARE SUBJECT TO MACROECONOMIC DEVELOPMENTS

DEME’s activities are driven primarily by the growth of the global population, the trend to locate industry near coastlines and along major rivers, the growth of the global economy and the need for suitable infrastructure that this growth entails, the increasing demand for energy and the transition to renewable energy and climate neutrality, the scarcity of specific minerals and raw materials, and the development of international trade and shipping. The following is a selection of key risks that, alone or in combination with other risks, could have a material adverse impact on DEME’s business, financial condition, results of operations and prospects. These risks could lead to a decrease in the number of projects and a decrease in investment in infrastructure projects and consequently impact DEME’s growth and profitability.

02 DEME’S BUSINESS AND GROWTH OPPORTUNITIES ARE SUBJECT TO GEOPOLITICAL DEVELOPMENTS

DEME’s operations are, in some instances, exposed to elevated risks relating to political and/or social instability (including war and civil unrest, armed conflict, terrorism, hostage taking, piracy, sanctions and international trade disputes and extraterritorial legislation).

03 DEME FACES PROJECT MANAGEMENT AND EXECUTION RISKS

Projects are usually characterised by the obligations entered into upon the submission of the offer as part of the tendering process for a project and, upon award, the signing of a contract to construct or deliver an infrastructure or a scope of work with a unique character for each project and within an agreed period of time.

04 D E M E F A C E S SIGNIFICANT COMPETITION IN ITS INDUSTRY

DEME faces competition from other local and international market players active in the same industry.

05 DEME IS SUBJECT TO RISKS IN RESPECT OF THE CONTRACTORS, SUPPLIERS, VENDORS, JOINT VENTURE PARTNERS OR OTHER PARTIES

The successful completion of projects depends on the ability of third parties to perform their contractual obligations and is subject to factors beyond DEME’s control, including actions or omissions by these parties and their subcontractors. A deeper assessment of the risks is included in Chapter 4 ‘Risk management and internal control’ and Chapter 5 ‘Financial information’ regarding the impact and respective risk management and control.

DEME ANNUAL REPORT 2022

DEME is a truly international company and gives everyone the opportunity to excel in their career and explore different roles. I originally joined the company in India in an administrative role and just a few years later, I became the first HR Officer on board of ‘Spartacus’, the most powerful cutter suction dredger in the world.
ANITHA SHANMUGAM | OCT 2020

SEGMENTS

CHAPTER 3 DEME’S ORGANISATIONAL STRUCTURE

DEME’s organisational structure
DEME has evolved into a global marine sustainable solutions provider organised around 4 distinct segments. Each of the segments serves a distinct market, and has separate assets, revenue models and growth strategies.

01 OFFSHORE ENERGY

This segment provides engineering and contracting services globally in the offshore renewables and oil & gas installation markets. With specialised offshore vessels. The scope of the Group’s activities involves full Balance of Plant contracts for offshore wind farms. The activities include engineering, procurement, construction and installation of foundations, turbines, substations as well as balance of plant and secondary systems. The Group also offers operations and maintenance, logistics, repairs and decommissioning as well as salvage services to the market. In the oil & gas industry, the Group performs landfalls and civil works, rock placement, heavy lift, umbilicals, as well as installation and decommissioning services. In addition to these main activities, the Group also provides specialised offshore services, including geoscience services and the installation of suction pile anchors and foundations.

Asset heavy
Investment in future growth
Dredging & Infra
Offshore Energy
Environmental
Concessions

58% of DEME turnover 1
18% of DEME turnover 1
36% of DEME turnover 1
Investments in projects with a long-term yield and where the risk profile is reduced to the maximum extent possible.

DEME ANNUAL REPORT 2022

02 DREDGING & INFRA
In this segment the Group performs a wide variety of dredging activities worldwide, including capital and maintenance dredging, land reclamation, soil improvement, port construction, coastal protection and beach nourishment works. The Group is equipped with specialised dredging vessels, various sophisticated marine equipment and heavy moving equipment. The Group also provides contracting services for marine infrastructure projects. This includes the engineering, procurement and construction (EPC) of marine structures such as jetties, port terminals, locks and weirs, infrastructural works such as bored and immersed tunnels, foundation and marine works for bridges or other constructions in a marine or fluvial environment and civil works for harbour construction, dams and sea defences, canal construction, revetment, quay wall construction and shore protection. In addition, the Group is active in the marine aggregates business, which includes the dredging, processing, storage and transport of aggregates. Finally, the Group provides maritime services for port terminals.

03 ENVIRONMENTAL
The Environmental segment focuses on innovative environmental solutions for soil remediation and brownfield redevelopment, environmental dredging and sediment treatment and water treatment. It is mainly active in Europe, the Middle East and Asia and in other European countries on a project-by-project basis.

04 CONCESSIONS
The Concessions segment, unlike the contracting segments, invests in and develops projects in wind, port infrastructure, green hydrogen and other special projects. It operates through participations in special purpose companies – greenfield and brownfield. Besides creating economic value on its projects and generating equity returns on its investments, it also aims to secure contracting activities for the Group in the EPC phases of its projects. Under the umbrella of this segment, the Group also holds concessions of seabed areas which contain polymetallic nodules and develops a technology to collect and process these polymetallic nodules containing nickel, cobalt, manganese and copper for the seabed.

OFFSHORE ENERGY


2015 the year we started offshore wind activities	€3.2bn total capacity installed since start
24 dedicated offshore energy vessels	€1.6bn turnover (2022)
	€2.1bn contributed capacity in 2022

DEME ANNUAL REPORT 2022

DEME Offshore Energy is the leading global solutions provider in the offshore energy industry, with a successful track record spanning more than three decades. We are playing a key role in supporting the energy transition and helping countries achieve their climate goals. We were one of the first companies to enter the renewables sector and today, we are the number one offshore wind contractor in the world, capable of installing the latest generation XL wind turbines as well as offshore substations, zero-emission vessels and the largest foundations. In the conventional energy industry, DEME performs landfalls, civil works, rock placement, heavy lift and decommissioning services. Operating a high-tech and versatile fleet of specialised vessels, DEME Offshore is able to provide fully integrated Balance of Plant, EPCI, and Transport & Installation contracts. Furthermore, DEME provides specialised offshore services, including geoscience services and geophysical offshore and marine site investigations, as well as environmental surveys to both the renewables industry and the oil & gas sector.

OFFSHORE ENERGY

ANNUAL REPORT 2022

Mission impossible? There is no such thing at DEME Offshore
DEME’s business philosophy is founded on its vessels, having super smart people and ingenious methodologies. With the aim of having the most modern, versatile and sustainable fleet in the industry, DEME is willing to take bold steps and make the necessary investments to ensure its vessels are getting faster, bigger, stronger and cleaner. This puts the company in a position where it can invent innovative methodologies for the challenges the world is facing that have never been used before. Ultimately, DEME aims to be the best offshore contractor, whether this is in renewables or conventional energy generation. DEME is continually looking for new, more efficient solutions. This drive is clearly demonstrated in developing markets such as the US and Brazil. In the US, DEME started thinking about innovative solutions and this led to a clever feedering concept which is going to be used at the Vineyard Wind project. The turbine towers will be delivered to DEME's dedicated WTG vessel by a US- owned barge and the transfer of the components offshore will be enabled by motion compensation technologies.Meanwhile, at Saint-Nazaire, DEME invents a giant offshore drill, and DEME is now the first company in the world to have completed an entire wind farm using monopile drilling technology in rocky seabed conditions. With incredibly challenging offshore wind farm projects successfully constructed by DEME Offshore, there is no doubt about the company’s prowess in this rapidly growing market. Installation records have been broken over and over again for turbines, foundations, cable laying and rock placement.

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DEME ANNUAL REPORT 2022

Installation of turbines, foundations, cable laying and rock placement at the Saint-Nazaire offshore wind farm represented a considerable challenge. Every element of the offshore wind farm, situated in the Baltic Sea, was pushing industry boundaries. This was also the first project for DEME’s new vessel ‘Orion’. The new vessel was tasked with installing the largest monopiles weighed more than 1,000 tonnes. Each of the 54 XXL monopiles weighed more than 1,000 tonnes.

DEME, with its partner Herrenknecht, introduced a whole range of specially designed equipment for the EPCI project and had to reinvent tools to perform the installations in floating conditions. The challenging soil conditions, comprising a muddy layer with chalk on top, required the use of specially designed equipment and a considerable amount of stabilisation. This meant that the sheer scale of these giants posed another challenge because DEME had to find manufacturing plants and ports able to cope with these mega structures.

‘Orion’ embodies evolution in the market

The enormous components had to be installed by the new vessel offshore to strict tolerances and to a very high standard. As the industry moves further offshore into deeper waters, the floating installation concept will become even more important. ‘Orion’ is the embodiment of the evolution in the market, being equipped with a 10,000-tonne capacity crane and a dynamic motion compensated pile gripper. This can upend the monopiles and they remain vertical and stable, despite motions and waves.

Strict tolerances achieved
To stabilise a monopile of this weight - while floating - would have been seen as impossible before. The 100 m plus monopiles had to be hammered in from a moving vessel, within a tolerance of 2.5%. The project was completed within the allocated timeframe and budget. DEME was delighted to work with its client Parkwind on such an ambitious project and to deliver what it promised, thanks to the incredible efforts of a determined and motivated team. DEME is proud to be the first to perform this floating installation method in the North Sea.

Arcadis’s first project for DEME’s revolutionary floating DP3 installation vessel ‘Orion’ was the installation of the foundations for the Arkona offshore wind farm in Germany.

56
Drilling an entire wind farm into rock in just 13 months at Saint-Nazaire

Ahead of schedule - DEME drilled an amazing feat in France when it drilled an entire wind farm into hard rock using industry-first technology at Saint-Nazaire. This accomplishment, which many thought was impossible, is even more remarkable given that the work continued throughout the winter months. Saint-Nazaire is the first commercial offshore wind farm ever built in France and also the first to use drilled, XL monopile foundations.

Rocky seabed
Undoubtedly, thorough, detailed preparation laid the foundations for success, as well as a willingness to invest in tailormade, innovative equipment. The preparation for the installation of the 80 wind turbines actually started four years before the first monopile was installed. DEME Offshore took the decision to manufacture its own dedicated equipment because there was no suitable equipment in the market. DEME Offshore and its partner Herrenknecht, the global leader in tunnel boring machines, jointly developed a giant offshore drill: the GRD-1000 Offshore Foundation Drill and this was accompanied by the so-called Drill Master. The Drill Master encapsulated the drilling, installation and grouting operations, protecting them from the harsh marine conditions, which in turn improves operational working time significantly. Crucially, the captain and crew of DEME’s jack-up ‘Innovation’ and the operations team made a huge difference to the success of the project, achieving terrific production rates.

A strong partnership
Crucial to the smooth running of the project was having the right partners on board such as Eiffage Métal for the fabrication of the foundations and Herrenknecht, as well as the support of the port authorities in La Rochelle and Saint-Nazaire and the local community. DEME Offshore and Eiffage Métal involved more than 1,000 employees and contributed to the development of the blue economy in France. Saint-Nazaire shows nothing is impossible if clients choose DEME.

57
DEME ANNUAL REPORT 2022

DEME Offshore Energy

DEME embraced the challenges, while being supported by many departments within the DEME Group. This shows how DEME is able to identify any risks, set up proper controls and mitigate any potential issues. To achieve this, DEME has the right equipment and unique vessels such as ‘Innovation’ with its impressive capabilities. During the Saint-Nazaire offshore wind farm project, DEME’s teams and crew have gained invaluable experience, which will be crucial for the future development of offshore wind farms in France, and it has recently been awarded the Yeu and Noirmoutier offshore wind farm, which will be built in France.

Saint-Nazaire is the first commercial offshore wind farm ever built in France and also the first to use drilled, XL monopile foundations.

58
Focus on sustainability

Climate change is one of the greatest threats to our planet and society. There is a growing need for access to affordable, reliable and sustainable energy. DEME provides solutions to expedite the much-needed global energy transition. The Offshore Energy segment provides sustainable business solutions such as:

Transport, installation and maintenance of offshore wind farms
Development of energy islands.

TRANSPORT, INSTALLATION AND MAINTENANCE OF OFFSHORE WIND FARMS

Since our very first wind farm installation in 2004, DEME has installed 4,500 turbines, representing a total installed capacity of 20 GW worldwide and has been a key player in the expansion of offshore wind farms, as well as in the installation of export cables and subsea power cables. In total DEME helped construct 4,500 turbines worldwide and has installed a total of 20 GW of capacity in wind farms and has installed a total of 14,000 km of cables.

DEVELOPMENT OF ENERGY ISLANDS

DEME has been pioneering the concept of energy islands off the coast, which involves an artificial, multifunctional island at sea combining offshore renewable energy production, storage, transmission and conversion to other energy sources. During the North Sea Summit held in Denmark, four countries (Belgium, the Netherlands, Germany and Denmark) have jointly pledged to accelerate the build-out of offshore wind and have agreed to establish three artificial islands in the North Sea. These islands, with a combined capacity of 10 GW and 15 GW respectively, will become cornerstones in the deployment and integration of such ultra-large-scale renewable energy generation, all four countries have decided or are considering constructing these islands.

In 2021, DEME was awarded the construction of the Princess Elisabeth energy island in Belgium. DEME will also be involved in the bidding process for the Danish Energy Island, which will connect up to 10 GW of offshore wind capacity, via a partnership with Copenhagen Infrastructure Partners (CIP), a leading global fund manager specialising in renewable energy investments. DEME also participates in several research initiatives such as the Joint Industry Projects HybridEnerSeaHub and North Sea Energy Cooperation. HybridEnerSeaHub is investigating the use of floating modules, in combination with reclaimed land, to make islands more adaptive in every stage of their lifetime. The North Sea Energy Cooperation brings together organisations, companies and knowledge institutions that have a connection with the North Sea in order to put the North Sea on the map as a pioneering region for the European energy transition. Using an integrated approach, the association researches how the North Sea’s potential can be utilised for a cleaner and more sustainable energy future.

FLEET UTILISATION RATE	TURNOVER	EBITDA & EBITDA MARGIN
2020	2020	2020
96.2%	1,134	146
2021	2021	2021
91.6%	2,817	171
2022	2022	2022
95.8%	3,261	222

(in million euro) (in weeks) (in million euro)

ORDERBOOK	MEGAWATT CONTRIBUTED CAPACITY
2020	2020
15.2%	2,798
2021	2021
18.6%	1,867
2022	2022
23.2%	2,499

(in million euro) (MW Installed foundations)

DEME ANNUAL REPORT 2022

The Offshore Energy segment turnover increased by 42% to €3.3 billion, reflecting a healthy backlog and strong execution of projects, and EBITDA increased by 29.4% to €222 million. In the second quarter, the ‘Orion’ was added to the fleet, bringing a game-changing installation concept to the offshore energy market.Shortly after its naming ceremony, the vessel set sail for the Moray East offshore wind farm (Germany) where XXL monopiles were successfully installed. These XXL monopiles are the largest monopile foundations ever installed, weighing more than 3,000 tonnes each. This achievement highlights DEME’s technical leadership. Other milestones for the year included the installation of all wind farm monopile foundations in St Nazaire (France) where the jack-up vessel ‘Innovation’ drilled monopile foundations into solid rock, another first for the industry, and a foundations, cables and wind turbine installation project for the Kaskasi wind farm in Germany. In the non-renewables sector the segment installed the intake and outfall heads for the Hinkley Nuclear power station (UK). DEME Offshore US prepared to mobilise the installation vessel ‘Sea Installer’ for the Vineyard Wind and South Fork projects, both on the US East coast. The segment also began preparatory work for its contract with the Dominion Energy Group for the construction of Coastal Virginia Offshore Wind, which will be the largest offshore wind farm in the US. The vessel occupancy for the offshore wind market dropped to 82% compared to previous years, mainly due to clients shifting cable installations to 2023 and technical adjustments to the vessels in support of project specifications in the US, China and Taiwan.

DEME Offshore Energy continued to invest in organisation and fleet (amongst others the ‘Green Jade’, an additional installation vessel, a DP fallpipe vessel and a cable laying vessel) in anticipation of future business growth. The vessel occupancy for the offshore wind market dropped to 82% compared to previous years, mainly due to clients shifting cable installations to 2023 and technical adjustments to the vessels in support of project specifications in the US, China and Taiwan.

The Offshore segment posted a solid EBITDA of €221.9 million, underpinned by a favourable project staging, in combination with the final settlement of €5.6 million as compensation for the delayed delivery of the vessel ‘Orion’, and strong overall project management. The increase in the Offshore Energy orderbook reflects new contract awards, received during the second half of the year, with project wins expected to run into multiple years, including sizeable project- wins in Continental Europe, the UK, the Middle East and the US.

	(in million euro)
	2022	2021	2020
Orderbook	3,260.9	2,816.6	1,133.5	+16%
Turnover	957.8	916.4	962.0	+5%
EBITDA	221.9	170.9	145.5	+30%
EBITDA margin	23.2%	18.6%	15.2%
EBIT	117.1	74.6	34.4	+57%
EBIT margin	12.2%	8.1%	3.6%
Fleet utilisation rate (weeks)	33.6	42.1	42.0

PROJECT EXECUTION IN 2022

DREDGING & INFRA

88 dredging vessels
€1.5 billion turnover (2022)
7 immersed tunnel projects executed
34 active countries

DEME ANNUAL REPORT 2022

DREDGING & INFRA

DEME has been creating new land and sustainable infrastructure for more than 145 years. The Dredging & Infra segment performs a wide variety of activities, including capital and maintenance dredging, land reclamation, port construction, coastal protection and beach nourishment works. DEME operates modern, technologically advanced vessels including dual fuel hopper and cutter suction dredgers, and it is very proud to own ‘Spartacus’, the most powerful cutter suction dredger in the world. The marine engineering infrastructure works complement and reinforce these dredging activities. The design and construction of port and inland waterway infrastructure, civil works such as bored and immersed tunnels, and other marine infrastructure including dams, sea defences, quay walls and shore protection are among activities carried out by DEME’s specialist marine engineering subsidiaries.

DREDGING & INFRA

ANNUAL REPORT 2022

More than 145 years of experience in dredging, land reclamation and marine infrastructure

DEME always wants to be a front runner and we have continually invested in having the best people and in modernising our fleet, ensuring we can anticipate our customers’ requirements and developments in the industry. This saw us make the bold decision to invest in a new mega cutter suction dredger, which is able to take on seemingly impossible tasks. ‘Spartacus’ is the most powerful cutter suction dredger in the world and its ability to cut hard rock is unrivalled as demonstrated in the following chapter where we outline its performance in the dredging of a major offshore wind project. In addition, our fleet is regularly performing maintenance dredging assignments such as our long-term contracts along the rivers Elbe and Scheldt. DEME’s dredging activities are supported by our marine engineering infrastructure works. The Infra team designs and constructs everything from port infrastructure to dams and sea defences, as well as bored and immersed tunnels. With a proven track record constructing immersed tunnels dating back half a century, DEME is the only marine engineering contractor that can combine dredging, offshore and marine engineering infrastructure works to deliver these challenging projects. Our diverse, multidisciplinary knowledge has enabled the Group to take on ‘once in a lifetime’ projects such as the Marmaray tunnel in Istanbul, the longest immersed road and rail tunnel in the world. Currently, our portfolio also includes the Oosterweel link in Antwerp, and the Blankenburg connection, which will see both a land and an immersed tunnel constructed, is progressing well. The Fehmarnbelt Fixed Link project, which will see both a land and an immersed tunnel constructed, is currently in the execution phase.

Dredging is at the heart of DEME, and we have been pioneering and creating land for the past 145 years. Our specialist, state-of-the-art fleet of hoppers, cutters, backhoe and water injection dredgers, enable us to take on the most challenging projects in the world, such as the construction of the new city and greenfield port in Egypt.

DREDGING & INFRA

DEME ANNUAL REPORT 2022

Consolidation of the Offshore segment

€654.7 million in revenue (2022)
20.6% EBITDA margin

The reduction in fuel is due to several innovative features DEME has introduced to make the vessel as energy efficient as possible. ‘Spartacus’ is equipped with dual fuel engines, enabling the operator to choose the cleanest fuel available, and the vessel is equipped with an installation to recover waste heat from the exhaust gases to generate steam and convert this by means of a steam turbine into up to 4,000 kW of electrical power.

Cutter suction dredger ‘Spartacus’ dredged extremely hard rock with production levels never reached before.

The Cutter suction dredger ‘Spartacus’ dredged extremely hard rock with production levels never reached before. The vessel is also equipped with an installation to recover waste heat from the exhaust gases to generate steam and convert this by means of a steam turbine into up to 4,000 kW of electrical power.

DREDGING & INFRA

Dredging is at the heart of DEME

DEME is dredging a total of 350 million cubic meters for the new city and greenfield port.

DEME’s newbuild and engineering teams, and the captains and crew, were amazed. The mega cutter suction dredger passed the test with flying colours. The mega cutter suction dredger passed the test with flying colours. It is clear: there is only one piece of equipment in the world today capable of achieving such astonishing production rates, and for which the rock would have been dealt with using drilling and blasting techniques. To kick-off its DEME career, after commissioning ‘Spartacus’ was deployed on its first project in Egypt, where a new city and greenfield port are being constructed. This is the largest dredging and land reclamation contract in DEME’s history, and on completion, it will be one of the biggest ports in the Mediterranean Sea.

The cutter suction dredger ‘Spartacus’ dredged extremely hard rock with production levels never reached before.

On top of this ability to remove a huge quantity of rock in a very short timeframe, another advantage was that port activities could continue as normal.

The cutter suction dredger ‘Spartacus’ dredged extremely hard rock with production levels never reached before.

In the port of Rotterdam, ‘Spartacus’ has now dredged 75 million cubic meters of sand and clay for land reclamation.