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TRANSCRIPT
DEME │ Analyst Meeting
29 November 2019
By Luc Vandenbulcke and Els Verbraecken
ANALYST MEETINGCONTENT
01 Company overview
02 Innovation
03 Sustainability & safety
04 DEME Group key figures
06 Closing
07 Questions & answers
COMPANYOVERVIEW
DEME Proprietary Information │ Commercial in confidence (see last page)
COMPANY OVERVIEWMILESTONES IN DEME HISTORY
4
COMPANY OVERVIEWSHAREHOLDER STRUCTURE
5
COMPANY OVERVIEW
3.532 3.635 3.8154.011 4.191 4.194 4.099 4.232
4.440
4.937 5.069
0
1.000
2.000
3.000
4.000
5.000
6.000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/06
Evolution of average FTE
EVOLUTION OF EMPLOYEES
6
12,5%
13,0%
13,5%
14,0%
14,5%
15,0%
15,5%
16,0%
83,5%
84,0%
84,5%
85,0%
85,5%
86,0%
86,5%
2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of gender diversity
% male % female
COMPANY OVERVIEWEVOLUTION OF GENDER DIVERSITY
7
DREDGING AND LAND RECLAMATION ENVIRONMENTAL INFRA MARINEOFFSHORE
DEME CONCESSIONS GSR
COMPANY OVERVIEWACTIVITY LINES
8
Maintenance dredging
Capitaldredging
Coastalprotection
Beachnourishment
Portconstruction
Landreclamation
DREDGING ANDLAND RECLAMATION
9
Foundations
Cables
WTGs
Geosciences
Landfalls andoffshore civils
Rock placement
Platform installation, decommissioning and
heavy lift
OFFSHORE
10
Environmental dredging
Soil remediation andtreatment
Sediment andsludge treatment
ENVIRONMENTAL
Landfilltechniques
Water treatment
11
Marineinfrastructure
Civil marineengineering
Tunnelconstruction
Foundationworks
Portconstruction
Breakwaters andharbour dams
INFRA MARINE
12
COMPANY OVERVIEWADAPTED TO THE ACTIVITY LINES
14
EC
Purpose Investing in projects that generate work for the DEME group Additionality
Investment size Participation size linked to scope of work± 7 bn deals closed in past few years (with partners)
Investment horizon Investment horizon till commissioning or longer if required for strategic reasons (e.g. maintenance)
Return expectations Market conform return expectations based on project due diligence & risks
Investment vehicle Partnership philosophy Advocates early involvement (pre‐financial close, greenfield developments) and a consistent partnership philosophy
DEME CONCESSIONSBUSINESS MODEL
RenewablesOffshore windWave & TidalFloating wind
InfrastructureChannel ConcessionsCivil InfrastructurePorts
Marine ResourcesOffshore Mineral Resources (GSR)
CONCESSIONS
15
DEME CONCESSIONSPARTICIPATION IN ENERGY PROJECTS
16
OPERATIONAL PHASE PROJECTS
C‐Power Belgian 325MW operational offshore wind farm.The project is operational since 2009, European Investment Bank (EIB) provided €450m. Euler Hermes, as German export agency covers €400m.
Rentel Belgian offshore wind project of ±300MW.Financial Close of the €1,1bn project was reached in September 2016. Including a €250M tranche from the EIB (Junker Plan) and a €50m EIB tranche guaranteed by the Belgian Export Credit Agency Delcredere|Ducroire.
Merkur Offshore German offshore wind project of ±400MW. Financial Close of the €1,6bn project was reached in August 2016. Including €360m funding from KfW (German DFI).
CONSTRUCTION PHASE PROJECTS
SeaMade Belgian Offshore Wind Farms Mermaid & Seastar of ±500MW.Financial Close of the €1,2bn project was reached in December 2018Including €250m funding from the EIB.
CONSTRUCTION PHASE PROJECTS
Tidal Power Scotland Limited
The project “MeyGen” is the world's first tidal power station connected to the electricity grid. Pilotphase installations in progress. The project is now ready to evolve from a prototype to an operational tidal turbine.
DEME CONCESSIONSSTRONG RENEWABLES FOOTHOLD IN EUROPE
7
5
2 1
3
4
Belgium
The Netherlands
Germany
UK
61
2
3
4
5
6
7
C‐Power
Rentel
SeaMade
Merkur Offshore
West Islay /
Sound of Islay
Meygen
Fairhead
OFFSHORE WIND
WAVE AND TIDAL
1,516 MW of capacity*
*Total capacity of wind farms with DEME Concessions equity stake; equity stakes vary
17
DEME CONCESSIONSDEME SHARE OFFSHORE WIND FARMS
18
OPERATIONAL PHASE PROJECTS C‐Power 6.5%
Rentel 18.9%
Merkur Offshore 12.5%
CONSTRUCTION PHASE PROJECTS SeaMade 13.25%
GSRTHE NEXT FRONTIER
GSR is the deep‐sea exploratory division of the DEME Group
It holds exclusive rights, granted by the International Seabed Authority (ISA), to harvest nodules from the seafloor in two 75,000 km2 concessions in the Clarion‐Clipperton Fracture Zone (CCFZ), one concession is held directly by GSR and the other via an agreement with the Cook Islands Investment Corporation (CIIC)
It also holds rights to harvest nodules in c. 20,000 km2 of the Cook Islands’ Exclusive Economic Zone (EEZ)
Lying on the sea floor, 4,500 m below the water, the CCFZ contains an abundance of polymetallic nodules that hold 1.2x more manganese, 1.8x more nickel and 3.4x more cobalt than entirety of land‐based reserves
Unlike terrestrial mining, there is no overburden that needs to be removed (i.e. no deforestation), and no roads, railways or new ports are needed to export the ore
GSR believes that with the correct environmental controls, effective protection of the marine environment and a robust regulatory framework, collecting nodules from the seafloor could be a more sustainable method of meeting the world’s mineral requirements and supporting our transition to a decarbonized future
19
GSRWHY DEEP‐SEA MINING?
Ready polymetallic source of battery metals:Nodules contain high quality nickel, copper, cobalt and manganese
Smaller environmental footprint than terrestrial mining
No social displacement or interference with populated areas
No overburden, no deforestation, no drilling / blasting
Mobile harvesting unit requires no rail or port infrastructure
Despite the seafloor containing low biodiversity density and high variability, state‐of‐the‐art environmental permitting process in place
Cash cost advantages:After byproducts, production is expected to be in the lowest quartile of the nickel cost curve
Easy to duplicate and highly scalable:Each harvest unit, and associated riser and surface ship can act independently
► Low jurisdictional risk Once ISA regulations finalised, challenging for individual / single
countries to change tax laws or nationalise resources (as compared to recent events affecting terrestrial mining in the DRC, Tanzania, etc.)
► Future global metal demand unlikely to be met by combination of recycling and terrestrial resources Terrestrial mining is encountering lower grade deposits,
located deeper and in more challenging jurisdictions at a time that metal demand is expected to increase due to increasing population and shift to low carbon future
► Happening now! GSR successfully launched cruises in 2014, 2015, 2017 and
2018, planned cruises in 2019 and 2021
High grade, recovered nodules contain CCFZ nodules: Ni: 1.2%, Co: 0.2%, Mn: 27%, Cu: 1.1%
(Average Abundance: 15 kg /m2) Cook Islands nodules: Ni: 0.3%, Co: 0.5%, Mn: 15%, Cu:
0.2% (Average Abundance: 25 kg /m2)
20
GSRDEEP‐SEA MINING PROCESS
Harvesting UnitsHydraulic nodule collector, mounted on a tracked undercarriage
Vertical Transport via RiserCollected nodules transported to the surface using a flexible riser, fitted with a series of single stage centrifugal pumps
Surface VesselSurface vessels with the capability of handling nodules to be purpose built based upon current designs
Bulk TransportTransported on standard cargo vessels for shipment to processing plant
1
2
3
4
12
34
Harvesting Units
Vertical Transport via Riser
Surface VesselBulk Transport
21
GSR
HARVESTING UNIT DESIGNS
2017 2022/20232019
Prototype Commercial Nodule CollectorPatania III
Pre‐Prototype Nodule CollectorPatania II
Tracked Soil Testing DevicePatania I
WAY FORWARD
22
› # 17 exploration contracts› 1.3% Ni, 1.2% Cu, 27% Mn, 0.25% Co, 0.05% Mo› 10% of CCFZ supplies enough materials for the replacement
of the entire global ICE fleet with Evs› Replaces 23 years of Ni, 35 years of Cu and 16 years of Co
mining for batteries only
GSRCLARION CLIPPERTON ZONE
23
INNOVATION
INNOVATION TO COPE WITH GLOBAL CHALLENGES
25
WHAT ABOUT THE RISING SEA LEVEL?
26
WHAT ABOUT THE GROWING POPULATION?
27
WHAT ABOUT GROWING CO2 EMISSIONS?
28
WHAT ABOUT POLLUTED RIVERS AND SOILS?
29
WHAT ABOUT THE SCARCITY OF MINERAL RESOURCES?
30
WORLD’S FIRST DUAL FUELHOPPER DREDGERS
SELF‐PROPELLEDDP2 JACK‐UP VESSEL APOLLO
MULTIPURPOSE ANDCABLE LAY VESSEL LIVING STONE
DP3 OFFSHOREINSTALLATION VESSEL ORION SPLIT BARGES
MEGA CUTTER SUCTION DREDGER SPARTACUS
INNOVATIONGAME CHANGING INVESTMENTS
31
Dual lane cable system
Two 5,000 tonnes cableturntables below deck
3,000 m² deck space, coupled with rock dumping capability of
12,000 tonnes
DP3 capabilities
Dual fuel engines
MULTIPURPOSE AND CABLE LAY VESSEL LIVING STONETHE MOST ADVANCED MULTIPURPOSE VESSEL IN THE WORLD
32
Pedestal for crane with liftingcapacity of 5,000 tonnes
Dual fuel engines
DP3 capabilities
High transport and load capacity fornext generation XL wind turbines
OFFSHORE INSTALLATION VESSEL ORIONAN UNRIVALLED COMBINATION OF TRANSPORT AND LOAD CAPACITY
33
Very first DP2 TSHD
Dual fuel engines
Able to work in deep watersof more than 100 m
Heavy duty trail pipe withrock draghead
(on port side of vessel)
Hydrodynamic hull reducingfuel consumption and enabling a high transport capacity at limited
depth
Two speed propulsiongearbox
TRAILING SUCTION HOPPER DREDGER BONNY RIVERAN INDUSTRY FIRST
34
Dual fuel engines
Dregding to exceptional depth of up to45 m with unprecedented pumping
distanceCan operate in high wave conditions
Unrivalled 12 MW cutter powerand able to cut harder soils at speeds that
have not been possible before
Can operate in the most remote locations given the fuel autonomyand large accommodation capacity
CUTTER SUCTION DREDGER SPARTACUSTHE WORLD’S MOST POWERFUL CUTTER SUCTION DREDGER
35
TURNING CHALLENGES INTO OPPORTUNITIESPLASTIC SOUP
36
TURNING CHALLENGES INTO OPPORTUNITIESPLASTIC SOUP
37
TURNING CHALLENGES INTO OPPORTUNITIESHYDROGEN
38
SUSTAINABILITY& SAFETY
40
OUR VISION AND CORE VALUES
“As a global solutions provider, we can contribute significantly to the United Nations Agenda 2030 for Sustainable Development.”
SUSTAINABILITYFIRST DEME SUSTAINABILITY REPORT
40
SUSTAINABILITYSUSTAINABILITY FRAMEWORK
41
SAFETYSAFETY PERFORMANCE DASHBOARD 2019 Q1‐Q3
42
DEME GROUPKEY FIGURES
DEME GROUP KEY FIGURESRESULT
44
Amounts in mio € ACT 12/14 ACT 12/15 ACT 12/16 ACT 12/17 ACT12/18 ACT 06/19
RESU
LT
TURNOVER2.419,6 100,0% 2.286,1 100,0% 1.978,2 100,0% 2.356,0 100,0% 2.645,8 100% 1.349,3 100,0%
EBITDA443,6 18,3% 489,2 21,4% 447,4 22,6% 445,5 19,3% 458,9 17,3% 199,1 14,8%
EBIT223,5 9,2% 269,2 11,8% 227,0 11,5% 230,5 9,8% 196,0 7,4% 52,7 3,9%
NET FINANCIAL RESULT‐23,4 ‐45,4 ‐33,8 ‐21,1 ‐6,9 ‐4,8
INCOME AND DEFERRED TAXES (% on PBT)‐56,6 28,2% ‐56,5 20,7% ‐20,4 10,6% ‐43,3 20,7% ‐43,2 22,8% ‐10,5 22,0%
RESULT EQUITY METHOD25,4 39,6 ‐13,3 ‐12,7 6,9 5,8
RESULT MINORITIES0,0 ‐1,5 ‐4,1 1,7 2,3 1,1
NET INCOME (Share Group)168,9 7,0% 199,2 8,7% 155,3 7,9% 155,1 6,6% 155,6 5,9% 44,3 3,3%
1.402,6
1.800,6 1.765,81.914,9
2.531,62.419,6
2.286,1
1.978,2
2.356,0
2.645,8
0
500
1.000
1.500
2.000
2.500
3.000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of turnover in mio €
DEME GROUP KEY FIGURESEVOLUTION OF TURNOVER
45
Dredging*42%
DEME Offshore43%
Infra7%
Environmental6% Others
2%
2019/H1
DEME GROUP KEY FIGURESTURNOVER BY ACTIVITY LINE: 2019 VERSUS 2009
Capital dredging53%
Marine works10%
Oil & gas7%
Environmental12%
Maintenance dredging18%
2009
*of which maintenance dredging 10%
46
DEME Offshore43%
Dredging*42%
Infra7%
Environmental6% Others
2%
2019/H1
DEME GROUP KEY FIGURESTURNOVER BY ACTIVITY LINE: 2019 VERSUS 2018
DEME Offshore51%
Dredging*37%
Infra5%
Environmental5% Others
2%
2018
*of which maintenance dredging 10%*of which maintenance dredging 11%
47
DEME GROUP KEY FIGURESTURNOVER BY REGION: 2019 VERSUS 2009
Europe ‐ EU66%
Europe ‐ non EU2%
Middle East5%
Indian subcontinent
4%
Africa10%
America4%
Asia & Oceania9%
2019/H1
Europe ‐ EU39%
Europe ‐ non EU4%
Middle East12%
Indian subcontinent
4%
Africa18%
America10%
Asia & Oceania13%
2009
48
DEME GROUP KEY FIGURESTURNOVER BY REGION: 2019 VERSUS 2018
Europe ‐ EU67%
Europe ‐ non EU2%
Middle East2%
Indian subcontinent
2%
Africa10%
America4%
Asia & Oceania13%
2018
Europe ‐ EU66%
Europe ‐ non EU2%
Middle East5%
Indian subcontinent
4%
Africa10%
America4%
Asia & Oceania9%
2019/H1
49
DEME GROUP KEY FIGURESRESULT
50
Amounts in mio € ACT 12/14 ACT 12/15 ACT 12/16 ACT 12/17 ACT12/18 ACT 06/19
RESU
LT
TURNOVER2.419,6 100,0% 2.286,1 100,0% 1.978,2 100,0% 2.356,0 100,0% 2.645,8 100% 1.349,3 100,0%
EBITDA443,6 18,3% 489,2 21,4% 447,4 22,6% 445,5 19,3% 458,9 17,3% 199,1 14,8%
EBIT223,5 9,2% 269,2 11,8% 227,0 11,5% 230,5 9,8% 196,0 7,4% 52,7 3,9%
NET FINANCIAL RESULT‐23,4 ‐45,4 ‐33,8 ‐21,1 ‐6,9 ‐4,8
INCOME AND DEFERRED TAXES (% on PBT)‐56,6 28,2% ‐56,5 20,7% ‐20,4 10,6% ‐43,3 20,7% ‐43,2 22,8% ‐10,5 22,0%
RESULT EQUITY METHOD25,4 39,6 ‐13,3 ‐12,7 6,9 5,8
RESULT MINORITIES0,0 ‐1,5 ‐4,1 1,7 2,3 1,1
NET INCOME (Share Group)168,9 7,0% 199,2 8,7% 155,3 7,9% 155,1 6,6% 155,6 5,9% 44,3 3,3%
20,6% 18,3% 17,0% 18,3% 17,3% 18,3% 21,4% 22,6% 19,3% 17,3%
1.402,6
1.800,6 1.765,8
1.914,9
2.531,62.419,6
2.286,1
1.978,2
2.356,0
2.645,8
0
500
1000
1500
2000
2500
3000
0
500
1.000
1.500
2.000
2.500
3.000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of turnover in mio € and EBITDA as % of turnover
DEME GROUP KEY FIGURESTURNOVER AND EBITDA %
51
DEME GROUP KEY FIGURESEBITDA EBIT NET INCOME
52
289
329300
351
438 444
489
447 456 459
147177
137 140
217 224
269
227 231
196
103117 104
89109
169199
155 155 156
0
50
100
150
200
250
300
350
400
450
500
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of EBITDA EBIT and net income in mio €
EBITDA EBIT Net Income Linear (EBITDA)
DEME GROUP KEY FIGURESBALANCE SHEET
Amounts in mio € ACT 12/14 ACT 12/15 ACT 12/16 ACT 12/17 ACT 12/18 ACT 06/19
BALA
NCE
SHE
ET
TOTAL EQUITY 986,7 1.132,9 1.220,6 1.321,8 1.401,4 1.365,7
TOTAL MINORITIES 11,0 11,0 14,9 14,4 14,1 13,3
LONG TERM FINANCIAL DEBT ‐502,0 ‐539,0 ‐527,0 ‐601,5 ‐494,8 ‐1.038,1
NET CASH POSITION 375,2 269,6 375,8 315,8 ‐61,0 232,4
TOTAL NET FINANCIAL DEBT ‐126,8 ‐269,5 ‐151,2 ‐285,7 ‐555,8 ‐805,7
WORKING CAPITAL ‐342,2 ‐305,0 ‐359,6 ‐568,8 ‐479,7 ‐422,6
53
DEME GROUP KEY FIGURESCASH FLOWS
Amounts in mio € ACT 12/14 ACT 12/15 ACT 12/16 ACT 12/17 ACT 12/18 ACT 06/19
CASH FLOWS FROM OPERATIONSNet ResultDepreciationOthers
168,9220,1‐22,2
199,2220,0‐41,0
155,3220,4‐18,0
155,1225,023,2
155,6256,9‐3,5
44,3138,0‐24,6
GROSS CASH FLOW 366,8 378,2 357,8 403,3 409,0 157,7
(INCR)/DECR WORKING CAPITAL 230,8 ‐42,4 46,0 145,3 ‐194,0 ‐31,5
AVAILABLE CASH FLOW 597,6 335,8 403,7 548,6 215,0 126,2
CASH NEEDSInvestments/divestmentsDistribution dividend
‐162,4‐30,1
‐312,1‐50,7
‐224,9‐60,0
‐607,8‐55,0
‐465,5‐55,0
‐240,1‐55,0
54
DEME GROUP KEY FIGURESEVOLUTION OF EQUITY VERSUS DEBT
55
570
987
1.366
358
127
806
344
502
1.038
0100200300400500600700800900
1.0001.1001.2001.3001.4001.500
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/06
Evolution of equity versus debt in mio of €
Equity Net Fin Debt Long Term Debt
DEME GROUP KEY FIGURESEVOLUTION OF INVESTMENTS AND NET FINANCIAL DEBT
56
313
416 394363
220172
343
258
623
483
358
481
651
742711
127
270
151
286
556
0
100
200
300
400
500
600
700
800
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of investments and net financial debt in mio €
Investments Net financial debt
NFD end of June 2019: 805.7 mio €
Investment plan 2008‐2012: NFD from 373 mio € ‐> 742 mio €
Debt reduction 2014: NFD is 127 mio € ( decrease of 615 mio € )
Investment plan 2015‐2020: NFD from 269 mio € ‐> 805.7 mio €
How is financing done?
DEME GROUP KEY FIGURESEVOLUTION OF INVESTMENTS AND NET FINANCIAL DEBT
57
DEME GROUP KEY FIGURESOTHER
ACT 12/14 ACT 12/15 ACT 12/16 ACT 12/17 ACT 12/18 ACT 06/19
ORDER BOOK 2.420,0 3.185,0 3.800,0 3.520,0 4.010,0 3.940,0
AVERAGE # EMPLOYEES (in FTE) 4.194 4.099 4.232 4.440 4.937 5.069
# PROJECTS 389 389 408 449 422
# COUNTRIES 41 52 44 54 57
# HOPPERS 22 21 18 20 20 21
# CUTTERS 18 15 14 14 14 13
# OFFSHORE EQUIPMENT 10 12 12 13 14 14
OTH
ER
58
‐
500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
4.500
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/06
Evolution of order book in mio €
BENELUX EUROPE ASIA PACIFIC MIDDLE EAST+INDIE OTHER
DEME GROUP KEY FIGURESEVOLUTION OF ORDER BOOK
59
3.532 3.6353.815
4.0114.191 4.194
4.0994.232
4.440
4.937
0,0
500,0
1.000,0
1.500,0
2.000,0
2.500,0
3.000,0
0
1.000
2.000
3.000
4.000
5.000
6.000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of average FTE and turnover in mio €
average FTE turnover
DEME GROUP KEY FIGURESEVOLUTION OF EMPLOYEES AND TURNOVER
60
115
152
192
232
314
389 389408
449422
0
500
1.000
1.500
2.000
2.500
3.000
0
50
100
150
200
250
300
350
400
450
500
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Evolution of # projects and turnover in mio €
# projects turnover
DEME GROUP KEY FIGURESEVOLUTION OF NUMBER OF PROJECTS AND TURNOVER
61
DEME GROUP KEY FIGURES# OF COUNTRIES IN 2018: ALL ACTIVITY LINES
62
Overview of turnover 2018
57 countries
8 9 10 11 11 10 12 12 13 14 14
22 2224 23 23 22 21 18
20 20 21
16 1615 18 18
18 1514
14 14 13
0
10
20
30
40
50
60
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/06
Evolution of main production equipment*
offshore equipment hoppers cutters
DEME GROUP KEY FIGURESEVOLUTION OF MAIN PRODUCTION EQUIPMENT
*is number of units without taking into account average capacity
63
CLOSING
CLOSINGDEME FUTURE PROOFED
WHAT ABOUT THE RISING SEA LEVEL?
WHAT ABOUT GROWING CO2 EMISSIONS?
WHAT ABOUT POLLUTED RIVERS AND SOILS?
WHAT ABOUT THE GROWING POPULATION?
WHAT ABOUT THE SCARCITY OF MINERAL RESOURCES?
65
QUESTIONS &ANSWERS
This presentation contains proprietary and/or confidential information.Any disclosure, copying, distribution or use of this information/the ideas incorporated is
strictly prohibited. This information is not to be considered as a representation of any kind.Any intellectual and industrial property rights and any copyrights with regard to thispresentation, and the information therein, shall remain the sole property of DEME.