- Net turnover increases by 8% compared to first half of 2008 to reach
EUR 235 million
- Stimulus packages reduce negative impact
- Results under pressure
Impact of global economic crisis apparent
The DHV Group, global provider of consultancy and engineering services, realized an 8% increase in turnover in the first half of 2009 compared to the same period in 2008. The positive effects of recent economic stimulus packages were particularly noticeable in the transportation market. Market demand decreased slightly, resulting in surplus capacity particularly in the Building & Industry and Aviation business groups. The Group’s overall operating profit showed a 15% decrease. The year to date turnover was in line with expectations. Higher financing costs for recent acquisitions tempered net profit. Although turnover for 2009 is expected to be in line with 2008, the operating result is likely to fall short compared to last year.
Mid year results for 2009 compared to first half year 2008
| |
|
|
|
| (in EUR x million, unless otherwise indicated) |
2009 |
2008 |
difference |
| Net turnover |
235.0 |
217.2 |
+8% |
| Added value |
176.1 |
158.9 |
+11% |
| Operating result before goodwill (EBITA) |
8.8 |
10.4 |
-15% |
| Net result |
3.2 |
5.1 |
-37% |
| Operational margin (EBITA/Added value) |
5.0% |
6,6% |
|
Opportunities in Environment & Transportation sectors, threats in Building & Industry
Recent stimulus packages had a positive impact on the transportation market in all the countries where the DHV Group operates. The Environment & Transportation and Water business groups profited the most from these measures. Demand for environmental and sustainability consulting services also continued to grow in the area of environmental management, climate and energy. Building & Industry and Aviation are experiencing a decline in demand and postponement of projects. Capacity is being selectively reduced in these business groups. DHV Group’s South African subsidiary SSI continues to benefit from projects linked to the World Cup 2010, while preparations for the European Championships in 2012 are well underway in Poland. Restructuring measures have been implemented in Portugal in order to adjust the company’s profile and size to local market developments.
The mix of the Group’s client portfolio (70% from the public sector and 30% from the private sector) and its presence in different regions worldwide have mitigated the impact of the economic crisis.
Further strengthening of company profile
The DHV Group expanded its profile in 2009 by increasing its stake in the North American aviation consulting firm Innova. The consultancy and project management agency NPC, formerly part of Dutch Railways, joined the DHV Group in March of this year. This acquisition entails a considerable strengthening of the Group’s position in the (inter)national market for station and railway projects.
High-profile projects
The DHV Group added several high-profile projects to its backlog in the first six months of 2009. DHV’s international environmental expertise proved crucial in winning the contract to perform the Environmental Impact Assessment for Lisbon’s new airport, the largest such study ever conducted in Portugal. DHV was commissioned to audit compliance of the construction of a 180 km motorway in Poland. DHV is one of the partners in the permanent joint venture TEC, which won the design contract for the tunnels that will link Hong Kong to mainland China. The company was also successful in winning the design contract to expand the harbor of Ashdod in Israel. DHV subsidiary NACO was commissioned by the government of Saudi Arabia to draw up strategic development plans for thirteen regional and local airports. In South Africa, SSI is providing design and supervision for the highly complex Mgeni viaduct, the country’s steepest incrementally launched structure. Alliance partner Delcan and its partner McKissack were awarded a multiple year Independent Engineering Consultancy contract by the New York Metropolitan Transportation Authority.
In the Netherlands the company is benefiting from the increasing demand for complex planning studies for large-scale infrastructure and flood protection schemes. Delft University of Technology engaged DHV to redevelop two of its main faculty buildings, while Dutch Railways commissioned DHV-NPC to provide program management services for the implementation of the public transportation chip card in all railway stations in the Netherlands. DHV is also advising telecoms provider KPN on the realization of the company’s ambitious sustainability targets.
Prospects
In the coming period, the DHV Group will continue to focus on providing sustainable services of the highest possible quality and addressing the changing needs of its clients. The internal priorities continue to be on cost reduction, improved cash flow, further integration of the recent additions to the Group, and ongoing critical assessment of its portfolio. Capacity will be brought in line with market demand. Staff members at underperforming business units will be reassigned or reduced. However, the number of staff in growth markets is increasing. The DHV Group expects to continue to expand its market share in the future. The company’s order book provides confidence for the second half of the year.