Boskalis jaarverslagen 2011

Dredging & Earthmoving

Construction and maintenance of ports and waterways, land reclamation, coastal defense and riverbank protection, dry earthmoving, offshore services for the oil and gas industry, soil improvement techniques and underwater rock fragmentation.

    2011   2010
(in EUR millions)        
Revenue   1,835   1,801
Operating result   267   321
Order book   2,307   1,923

Revenue

Revenue in the Dredging & Earthmoving segment totaled EUR 1,835 million (2010: EUR 1,801 million). The activities of MNO Vervat, which were acquired with effect in mid-December, contributed EUR 12 million to the revenue figure. As from 2012 the dry earthmoving activities will be reported in the new Dry Infrastructure segment. In addition to Boskalis’ dry earthmoving projects this new segment will also comprise the dry infrastructure activities of MNO Vervat.

REVENUE BY MARKET   2011   2010
(in EUR millions)        
Home markets in Europe   588   572
Home markets outside Europe   191   118
International projects   882   873
Specialist niche services   174   238
    1,835   1,801

Home markets

Revenue in the home markets amounted to EUR 779 million (2010: EUR 690 million).

Revenue in the European home markets (the Netherlands, Germany, United Kingdom, Nordic countries) rose 3% by EUR 588 million (2010: EUR 572 million). Projects contributing to this revenue in the Netherlands included Maasvlakte 2 and coastal defense projects along the coast of the province of Zuid-Holland (Sand Motor and Delfland coast) and the Wadden islands (Ameland). In the other European home markets Boskalis worked on numerous port and waterway maintenance projects as well as several coastal defense projects in the United Kingdom.

Revenue in the home markets outside Europe (Nigeria and Mexico) rose by 62% to EUR 191 million (2010: EUR 118 million). In Mexico it was mainly the Cuyutlán project which contributed to revenue. However, most of the growth was achieved in Nigeria, where the activity level picked up again after a few quieter years. Prospects for further growth in Nigeria are promising, although concerns on the part of the oil and gas majors about the general stability of the country are still causing them to be cautious in taking major investment decisions.

International project market

At EUR 882 million, revenue from the international project market was slightly higher than that of the previous year (2010: EUR 873 million). The projects are broadly spread across the market segments and the geographical regions, with projects in Australasia and Central and South America currently making the biggest contribution to revenue.

Specialist niche services

At EUR 174 million, revenue from specialist niche services was down on last year (2010: EUR 238 million). As in 2010 Boskalis Offshore worked on the Nordstream project and carried out various rock projects using fallpipe vessels. In the second half of 2011 work started on a cable-laying project in South Argentina. In addition, good progress was made in 2011 on the seven-year Fox River project, involving the separation and processing of PCB-contaminated dredging sludge from the Fox River in Wisconsin (the United States).

Fleet developments

Good utilization of the hopper fleet in the second half of the year, following a weak first half, allowed us to achieve an annual utilization rate of 39 weeks (2010: 43 weeks). Because of the tough market conditions it takes considerable effort to secure good equipment utilization levels at acceptable project margins and/or risk levels. This was particularly noticeable in the lower utilization rate of the cutter fleet, which stood at 19 weeks in 2011 (2010: 27 weeks).

January 2012 saw the naming ceremony of the new fallpipe vessel, the Rockpiper, in Singapore. The ship, which will be deployed mainly for offshore work, is scheduled for delivery at the end of March 2012. The order book for this ship already equates to over a year’s utilization.

Segment result

The operating result (EBIT) of the Dredging & Earthmoving segment totaled EUR 267 million (2010: EUR 321 million). The decline is attributable to the changed market conditions as well as the fact that the result for 2010 included extraordinary gains of EUR 33.6 million related to the settlement of a number of long-running insurance and other equipment-related claims. 
In 2011, the result was once again positively impacted by the financial settlement of various projects, especially in the Middle East, which had previously been technically completed.

Order book

In 2011, on balance EUR 1,692 million of new work was acquired. In addition, contracts with a (revenue) value of EUR 527 million held by MNO Vervat were added to the order book.

ORDER BOOK BY MARKET   31 Dec 2011   31 Dec 2010
(in EUR millions)        
Home markets in Europe   1,045   628
Home markets outside Europe   108   133
International projects   864   965
Specialist niche services   290   197
    2,307   1,923

In the oil and gas market various projects were acquired in Nigeria, while variation orders were awarded on current projects including those in Australasia. Several cable-laying contracts were acquired in the course of 2011, including a contract for the installation and protection of two power cables between the Indonesian islands of Java and Bali and a fiber-optic telecom cable in Southern Argentina. In Suriname we took on an interesting contract to excavate bauxite using a cutter dredger.

In the ports market segment we acquired a large project for the construction of a new port at the Superporto do Açu complex in Brazil, and took on and executed a port development project for Sydney Ports in Canada. In addition several port and waterway maintenance projects were acquired in the various home markets.

In early January, the Punta Pacifica project was taken on in the land reclamation and coastal defense segment, involving the construction of an artificial island off the coast of Panama City. Finally, in early November, Boskalis acquired the contract to redevelop the waterfront in the Dutch municipality of Harderwijk. At the end of 2011, the order book stood at EUR 2,307 million (end-2010: EUR 1,923 million).

Added to My report add to My report Source: Annual review 2011, Report of the Board of Management, page 36