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DEME Group NV
Earnings Release • May 14, 2024
3939_10-q_2024-05-14_71226313-fc06-477b-9dea-4f8fdb29ebd7.pdf
Earnings Release
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TRADING UPDATE 1Q24
High activity level and effective project execution lead to a strong start of the year
Regulated information
DEME Group NV, Zwijndrecht, 14 May 2024, 7:00 am CET Today DEME (Euronext: DEME) announced topline metrics for the first quarter ended 31 March 2024
HIGHLIGHTS FIRST QUARTER 2024
- ‒ Orderbook maintained at a high level of 7.5 billion euro
- ‒ Group turnover for the first quarter was 900 million euro, compared to 672 million euro for the first quarter last year
- ‒ Management reaffirms guidance for the year of turnover growth of at least 10% compared to 2023 with an EBITDA margin comparable to 2023
ORDERBOOK
Year-over-year and quarter-over quarter comparison
| (in million euro) | 1Q24 | 4Q23 | 1Q23 | 1Q22 | 1Q24 vs 1Q23 |
|---|---|---|---|---|---|
| Offshore Energy | 3,935.6 | 3,754.6 | 3,922.3 | 2,775.2 | +0% |
| Dredging & Infra | 3,211.0 | 3,472.4 | 2,883.1 | 2,761.3 | +11% |
| Environmental | 369.6 | 354.7 | 292.6 | 293.9 | +26% |
| Group | 7,516.2 | 7,581.8 | 7,098.0 | 5,830.4 | +6% |
Orderbook at group level maintained a strong level of 7,516 million euro, compared to 7,098 million euro a year ago and 7,582 million euro at the end of 2023. During the first quarter, Offshore Energy secured the large cable installation contracts for Ijmuiden Ver and Nederwiek in the Netherlands, complemented by several smaller projects across all contracting segments of the Group.
TURNOVER
Year-over-year comparison
| (in million euro) | 1Q24 | 1Q23 | 1Q22 | 1Q24 vs 1Q23 |
|---|---|---|---|---|
| Offshore Energy | 389.7 | 278.8 | 190.5 | +40% |
| Dredging & Infra | 467.0 | 341.9 | 393.3 | +37% |
| Environmental | 94.4 | 65.2 | 37.2 | +45% |
| Concessions | 1.0 | 1.6 | 0.4 | |
| Total turnover of segments | 952.1 | 687.5 | 621.4 | +38% |
| Reconciliation1 | -51.9 | -15.3 | -4.7 | |
| Total turnover as per financial statements | 900.2 | 672.2 | 616.7 | +34% |
Following a record fourth quarter in 2023, revenues during the first quarter of 2024 remained at a high level, reflecting continued effective project execution across all contracting segments resulting in an increase of 34% year-over-year.
OUTLOOK 2024
The following statements are forward looking, and actual results may differ materially.
While DEME has observed an exceptional growth in the first quarter compared to the same period last year, management reaffirms its outlook for the year, anticipating a turnover growth of at least 10% for the year.
Management also expects EBITDA margin to be comparable with 2023 and CapEx for the year is anticipated to be between 300 and 350 million euro.
1 The reconciliation between the segment turnover and the turnover as per financial statements refers to the turnover of joint ventures. They are consolidated according to the proportionate method in the segment reporting but according to the equity consolidation method in the financial statements.
OPERATING SEGMENTS
Please find below a review of the first quarter highlights at DEME's operating segments.
OFFSHORE ENERGY
The Offshore Energy segment top line grew 40% yearover-year driven by efficient project execution and helped by a favorable comparison base for the first quarter of last year.
During the first quarter, Offshore Energy successfully completed the monopile installation works for the Moray West offshore wind farm project in Scotland. DEME's floating installation vessel 'Orion' installed 29 XXL monopiles in record time, utilising vibro-hammer technology, while the 'Apollo' started the installation of the transition pieces for this project. In France, DEME concluded the wind turbine installation work for the Fécamp offshore wind farm, deploying the vessels 'Innovation' and 'Sea Challenger', and kicked off the Île d'Yeu and Noirmoutier projects, for which DEME will utilise its unique drilling technology previously deployed for the Saint-Nazaire project.
In Taiwan, DEME's floating offshore installation vessel, 'Green Jade', completed its first assignment, installing jacket foundations for the Zhong Neng project. Offshore Energy kicked off the Hai Long project by preparing the seabed and installing pinpiles for the first jacket locations. 'Green Jade' also installed successfully the first jacket for the substation.
In the US, 'Sea Installer' continued installing turbines for the Vineyard project, while 'Orion' -following its assignment in Scotland- sailed back to the United States to initiate the Coastal Virginia Offshore Wind project, which involves the installation of 176 foundations.
Offshore Energy secured two cable installation contracts from Prysmian for the Ijmuiden Ver Alpha and Nederwiek 1 offshore grid systems in the Netherlands. This represents the most extensive cabling award in DEME's history and encompasses cable installation, landfall and rock placement, dredging, and marine infrastructure works. Work under the contracts is scheduled to begin in 2025 and continue in stages.
The final conversion of the 'Yellowstone' fallpipe vessel progressed well during the first quarter. The vessel is now planned to join the DEME fleet during the second quarter and to commence operations in the summer of 2024.
DREDGING & INFRA
Dredging & Infra's turnover growth of 37% reflects a sustained high activity level compared to last year resulting in a turnover of 467 million euro, up from 342 million euro in the first quarter of last year.
Dredging & Infra continued to work on maintenance contracts across Europe, including Belgium and Germany, as well as in Asia, Africa and South America. New terminal works are currently ongoing in Ravenna, Italy, along the Thames at London Gateway Port, United Kingdom. In France, rock dredging works in the harbour of La Pallice, La Rochelle, have been completed. Meanwhile, in the Netherlands, dredging works for the New Lock Terneuzen is nearing completion, marking an important milestone for this major Infra project.
Overseas, Dredging & Infra is preparing a coastal protection project in Grand Lahou, Ivory Coast. In the Middle East, works continued in Abu Dhabi with the deployment of multiple hopper and cutter suction dredgers alongside the commencement of the dry earth moving activities for the Oxagon Phase 2 project in Saoudi Arabia, a large multi-year project awarded in the last quarter of 2023.
One year after the contract award for the Princess Elisabeth Island, DEME, as part of the TM EDISON consortium, has initiated the construction of the caissons and the seabed preparation. The Princess Elisabeth Island will be the world's first artificial energy island serving as an energy hub collecting and transporting green electricity to shore and linking Belgium to neighbouring countries.
Good progress was made in constructing tunnel elements for the Scheldt Tunnel, part of the Oosterweel Connection project in Antwerp, Belgium. The tunnel elements will be towed to Antwerp early next year for immersion, assembly and connection to the riverbanks. In France, the port development in Port-La Nouvelle continues to advance while the Fehmarnbelt tunnel project in Denmark is progressing well, with the first installation of tunnel elements planned for the second half of this year.
The pipeline of projects remains healthy with major opportunities in Europe, the Middle East, India and Africa.
ENVIRONMENTAL
The Environmental segment delivered an outstanding quarter with the topline increasing 45% compared to a year ago. Growth was mainly driven by soil remediation and water treatment projects in Belgium including Oosterweel, Cokeries du Brabant and Feluy, and in the Netherlands with the projects GoWa and Ijburg and Marken, a new multi-year dyke reinforcement project. The projects in the UK and Norway advanced, deploying DEME's on-site treatment centres.
CONCESSIONS
The Concessions segment remains involved in operational wind farms that are generating recurring income while working on the 2 gigawatt concession project in Scotland and preparing for upcoming tenders in Belgium. For dredging & infrastructure, DEME Concessions maintains its focus on projects both in portfolio and under construction including Blankenburg in the Netherlands, Port-La Nouvelle in France and port of Duqm in Oman, while it moves ahead on the preliminary awarded project for the new deepwater terminal for the port of Swinoujscie in Poland.
DEME's long term growth initiatives, Global Sea Mineral Resources (GSR) and DEME HYPORT Energy (green hydrogen) remain on track with the HYPORT Duqm project in Oman embarking on a certification pilot project in accordance with the EU regulation.
Financial Calendar
| 15 May 2024 | General Assembly |
|---|---|
| 29 August 2024 | Half year 2024 results |
| 14 November 2024 | Trading update Q3 2024 |
29 August 2024 Half year 2024 results
For more information
Media relations Frederic Dryhoel [email protected] +32 473 86 31 91
Investor relations Carl Vanden Bussche [email protected] +32 498 90 61 13
Additional information
The information given in this press release has not been reviewed by the statutory auditor.
ABOUT DEME
DEME (Euronext Brussels: DEME) is a leading contractor in the fields of offshore energy, dredging & infra, environmental remediation, trenching and marine infrastructure. DEME also engages in concessions activities in offshore wind, marine infrastructure, green hydrogen, and deep-sea mineral harvesting. The company can build on almost 150 years of experience and is a front runner in innovation and new technologies.
DEME's vision is to work towards a sustainable future by offering solutions for global challenges: a rising sea level, a growing population, the reduction of emissions, polluted rivers and soils and the scarcity of mineral resources. DEME can rely on more than 5,300 highly skilled professionals and operates one of the largest and most technologically advanced fleets in the world. DEME realised a turnover of 3,285 million euro with an EBITDA of 596 million euro in 2023.
www.deme-group.com
Disclaimer
This press release may contain forward-looking information. Forward-looking statements describe expectations, plans, strategies, goals, future events or intentions. The achievement of forward-looking statements contained in this press release is subject to risks and uncertainties. Consequently, actual results or future events may differ materially from those expressed or implied by such forwardlooking statements. Should known or unknown risks or uncertainties materialise, or should our assumptions prove inaccurate, actual results could vary materially from those anticipated. DEME undertakes no obligation to publicly update or revise any forward-looking statements.