Very Busy 2015 for DEME

DEME reported another particularly active first half-year in 2015. A net profit of 119.8 million euros (1H14: 62.6 million euros) was realized on an (economic) turnover of 1,218.7 million euros.

Besides the many ongoing projects on all continents, several largescale projects in Australia (Wheatstone and Hay Point) and in Belgium (Northwind wind farm) were successfully completed; good progress was made on the construction of a new port in Doha (Qatar), more than six months ahead of the contractual schedule; and a large fleet was deployed on the deepening and expansion of the Suez Canal in Egypt.

In October 2014, the Suez Canal Authority awarded a contract to the DEME (75%) – Great Lakes (25%) consortium for the realization of an additional 250-meter-wide, 24-meter-deep and 29.5 kilometer-long fairway through the Great Bitter Lake.

The access channels to the lake have been widened to 140 meters. For this project, DEME deployed a rarely seen fleet of 4 cutter suction dredgers, 6 suction hopper dredgers and 42 auxiliary vessels, which dredged as much as 40 million m³ in record time.

The modernized Suez Canal was officially opened on August 6, 2015.

DEME subsidiary GeoSea was engaged on the construction of offshore wind farms, such as the Godewind project in Germany and Kentish Flats in the United Kingdom.

The turnover for the first six months of 2015 amounted to 1,218.7 million euros (1H14: 1,305.6 million euros), on which a net profit was realized of 119.8 million euros (1H14: 62.6 million euros).

The order book at June 30, 2015, increased to 3,362 million euros, compared with 2,420 million euros at year-end 2014.

At the beginning of 2015, several new contracts worth a total of 1.6 billion euros were won, including the major Tuas project in Singapore. The construction of this mega port involves, among other things, the reclamation of 300 hectares of land, the construction of an 8.6-kilometer quay wall, and the dredging of the harbor channels.

The works will take six years to complete.

Longterm contracts were also signed for maintenance dredging on the river Scheldt, the dredging of mine-derived sediments on the OK Tedi river system in Papua New Guinea, in Nigeria (EKO Atlantic), India, La Réunion, and the remediation of the historic refinery site of Esso Norge (Norway).

In July 2015, DEME Concessions entered into a joint venture to develop the Merkur Offshore wind farm (400 MW), one of the largest in Germany.

GeoSea will begin the installation of the 66 offshore wind turbines in 2016.

DEME continues to invest in the renewal and expansion of its fleet with four environmentally friendly (dual fuel with LNG) trailer suction hopper dredgers with capacities of respectively 1,500, 3,000, 8,000 and 14,500 m³.

Also, from 2017, the self-propelled jack-up vessel Apollo, the multipurpose and cable-laying ship Living Stone, and the self-propelled DP2 crane vessel Rambiz 4000 (Scaldis) will serve the offshore energy market. On May 13, 2015, GeoSea also completed the acquisition of the offshore assets of HOCHTIEF (of which DEME owned 50%).

As a result of that transaction, which represents a total investment of around 166 million euros (including assumption of debt), GeoSea acquired full control of jack-up vessels Innovation and Thor and pontoons Wismar, Bremen and Stralsund.

Together with the normal replacement investments, the part payments on the above-mentioned investments in new vessels, and the sale of some old vessels, this puts DEME’s total capex at 271.2 million euros as at June 30, 2015.

Despite these massive investments of the first six months, the net financial debt only increased to 351.0 million euros (31/12/2014: 212.8 million euros), which reflects DEME’s strong cash flow generation during the first half of the year.