2018 half year results. Amsterdam, 23 August 2018

Transcription

1 2018 half year results Amsterdam, 23 August 2018

2 BAM reports 1H18 adjusted pre-tax result of 57.8 million and reconfirms full year outlook Construction & Property: Dutch residential property development drives margin improvement Civil engineering: cost overrun IJmuiden offset by improved results outside the Netherlands PPP: solid result from existing portfolio supported by project transfer to PGGM joint venture Order book: stable and developing in line with markets Higher cash outflow in the first half of 2018; Trade working capital efficiency reduced from -11.1% to -10% Adoption IFRS 15 accounting change: restatement 2017 opening shareholders equity and result 1

3 Construction and Property (1) (in million) Revenue Result NL UK BE GE IE INT 0-5 NL UK BE GE IE INT Order book TWC efficiency % -5% -10% 0 NL UK BE GE IE INT 1H18 1H17, restated for IFRS Q2 Q Q2 Q Q2 Trade working capital Q-end Average TWC as % of 4-Q rolling revenue Restated for IFRS 15 as from Q Restated for IFRS 15 as from Q % 2

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5 Construction and Property (2) Number house sales Gross property position (in million) Q2 Q Q2 Q Q2 Q Q2 Q1 Q2 Q3 Q4 Gross property position 4

6 Civil engineering (in million) Revenue Result NL UK BE GE IE INT NL UK BE GE IE INT Order book TWC efficiency % % NL UK BE GE IE INT 1H18 1H17, restated for IFRS Q2 Q Q2 Q Trade working capital Q-end Average TWC as % of 4-Q rolling revenue Restated for IFRS 15 as from Q Restated for IFRS 15 as from Q Q2-10% 5

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8 PPP (in million) Portfolio (number) Results Investment H18 0 1H17 1H H18 In operation Under construction Preferred bidder Adjusted result before book profits Book profits Injected equity Comitted equity 1H17 Restated for IFRS 15 7

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10 Accounting change: IFRS 15 Revenue recognition BAM adopted the new standard with effect from 1 January 2018 More conservative accounting for timing of revenue recognition Highly probable threshold replaces more likely than not Transition to new standard uses the fully retrospective approach Restatements of opening shareholders equity and result for 2017 Largest effects on International, Dutch civil engineering and German construction No change to management s view of outcome of projects No effect on cash flow May lead to more volatile reported results 9

11 Income statement (in million, unless stated otherwise) 1H18 Margin 1H17* Margin Total sectors % % Group overhead Group interest charge Adjusted result before tax % % Restructuring Impairments Result before tax Income tax Non-controlling interest Net result % % * Restated for IFRS 15 10

12 Trade working capital Trade working capital * (in million) Trade working capital (in million and TWC as %) % -5% -10% Q Q Q Q Q Q Q2 Q Q2 Q Q2-15% Work-in-progress credit Trade and other receivables Trade working capital Work-in-progress debit Trade and other payables * Restated for IFRS 15 as from Q Trade working capital Q-end, restated for IFRS 15 as from Q Average TWC as % of 4-Q rolling revenue, restated for IFRS 15 as from Q

13 Cash flow (in million, unless stated otherwise) 1H18 1H17* Net cash result Investments (I)TFA Trade working capital Net investment Property Net investment PPP 4 3 Other working capital Business cash flow Dividend Restructuring Pensions (additional) -8-7 Others Cash position * Restated for IFRS 15 12

14 Financial position (in million, unless stated otherwise) 30 June December 2017* 30 June 2017* Cash position Interest-bearing debt Net cash position Recourse net cash position Capital ratio * 19.9% 18.6% 19.1% Return on rolling average capital employed * 1.8% 0.6% 2.8% * Restated for IFRS 15 13

15 Market conditions 14

16 Order book (in million) 30 June December 2017 Construction and Property 6,827 6,890 Civil engineering 4,905 4,693 PPP Eliminations and other Total sectors 11,800 11,600 15

17 Key priorities Pre-construction management Digitalisation IT standardisation Business controls 16

18 Outlook For the full year 2018, BAM expects an adjusted result before tax margin of around 2%. 17

19 Annexes Updated strategy: Building the present, creating the future Property investments PPP investments Net cash analysis Revenue sector/country 18

20 Strategy Building the present, creating the future Focus project portfolio Shape business portfolio Create future portfolio Differentiating capabilities BAM s unique culture 19

21 Targets 2020 Profit People ROCE >10% Safety IF < 3.5 Adjusted pre tax margin 2-4% Property < 500m TWC < -10% Planet Net positive impact Half year results August

22 Focusing project portfolio (1) Scale Expertise 21

23 Focusing project portfolio (2) Selection Stage gate Peer review Operational audit 22

24 Focusing project portfolio (3) Peer review Tender assessment Operational audit Stage gate 1 Stage gate 2 Stage gate 3 Stage gate 4 Stage gate 5 Categorisation Decision to tender Initial validation Decision to bid Approval final contract If won: Reality check PQQ Submitted/ Partnerships formed Tender documents received Tender submitted Contract awarded 23

25 Home markets Royal BAM Group nv Shape business portfolio Inside Fix or exit Develop new propositions along lifecycle Outside Stay out Leverage high-margin specialisms High Level of competition Low 24

26 Create future portfolio Digital construction process Digital built environment 25

27 Culture Predictable performance Proactive ownership Profitable projects Selected segments Open collaboration Execution Understanding Scalable learning Proposition Innovation 26

28 Capabilities Operating companies Group Project selection Project execution Synergies in selected specialisms Smart engineering + Talent development = Controls & exchange Best in industry digital Financial strength BAM value 27

29 Property investments (in million, unless stated otherwise) 30 June June 2017 Land and building rights Property development Total investments (a) Total investments as at 30 June 2018 (in million) Non-recourse loans Recourse loans Total loans (b) Property associates/jv/ahfs (c) Net investments (a) (b)+(c) NL UK BE IE Residential Non-residential 28

30 PPP investments (in million, unless stated otherwise) 30 June December 2017 Invested equity 1) Committed equity 2) Total invested & committed equity Of which committed equity by PGGM Estimated unrealised value based on cash flows ) BAM share invested in equity of PPP contracts. 2) Excluding contracts in preferred bidder stage. 29

31 Net cash analysis (in million, unless stated otherwise) 30 June December 2017 Non recourse PPP loans Non recourse project financing Other project financing Total project related Subordinated convertible bonds Financial lease liabilities Bank overdrafts and other loans 5 5 Total interest-bearing debts Less: cash Net cash position

32 Revenue sector/country (in million, unless stated otherwise) Construction and Property Civil engineering PPP Total Netherlands 19% 18% 0% 37% United Kingdom 16% 11% - 27% Belgium/Luxembourg 6% 4% 0% 10% Germany/Swiss 7% 7% 0% 14% Ireland 5% 2% 2% 9% International 1% 2% - 3% Total 54% 44% 2% 100% Revenue per sector/country 2017 as a percentage of gross total revenue

33 Contact details BAM Investor Relations Joost van Galen +31(0)