Financial position further strengthened
VolkerWessels posted a solid result in the first six months, despite the still worrying market conditions in a number of sectors in the Netherlands. Although there appear to be some prospects of improvements on the housing market in the Netherlands, Building & Property Development and the Infrastructure market are still affected by overcapacity, which continues to depress prices.
The robust overall performance is attributable to operational and financial discipline, an approach which combines capitalising on opportunities, whilst placing the focus on margin rather than volume, cost management and a healthy risk/return ratio. Once again, a number of new, high-profile contracts were secured, such as the construction of a university building for the VU University Amsterdam, work on ‘Room for the River’ programme, and the Dudgeon and Westermeerwind offshore projects.
Jan van Rooijen, CFO, said: “All sectors at VolkerWessels once again achieved a positive operating result. Our solid financial position enables us to exploit opportunities and invest in activities which impact positively on the future progression of our results. Agreement has been reached with seven banks on the continuation of our working capital financing until mid-2019. We are very pleased that the terms of this financing reflect our healthy financial position.”
Net debt was again reduced in the first half of 2014. VolkerWessels’ financial position was also further strengthened by the renewal of our working capital facilities.VolkerWessels has agreed a committed credit facility with a syndicate of seven banks. This new credit facility runs until 12 August 2019 and replaces a number of existing facilities of similar proportions, which were due to expire in 2015. The conditions for the new facility are largely the same as the conditions that applied to the existing facilities.
VolkerWessels stepped up its investment programme and invested € 48 million in equipment in the first six months of 2014. In addition to substantial investments in equipment for our UK rail activities and in Canada, we also purchased two new workboats for our offshore activities. We also commenced production at a new asphalt plant in Harderwijk and invested in our construction and supply companies for our new “future living” concept, MorgenWonen.
On the Dutch market for highway engineering consultancy and research, we consolidated our position with the acquisition of Surface Cracks. This company provides consultancy, undertakes research and carries out surveys for roads, airports, cycle paths and pedestrian zones.
We also took over the activities of PRS International. PRS works mainly for the petro-chemical industry and oil refineries, and specialises in cleaning, inspecting and calibrating pipe systems.
A letter of intent has been signed to take over the Meulen Groep’s construction and development activities. Meulen is being merged with Aannemersbedrijf Louis Scheepers. Meulen Groep, comprising Meulen Projectontwikkeling and Meulen Bouw, was founded in 1928. The Weert-based company operates in the Southeast Netherlands and Belgium.
In Canada, we acquired the activities of Mainline Construction Ltd. Mainline Construction operates chiefly in the northwest of the province of Alberta. The company specialises in underground infrastructure and area development and is also active in the oil and gas industry around Grande Prairie.