NIEUWEGEIN, The Netherlands, July 12, 2013 /PRNewswire/ --
- Operating profit of € 1 million (1st half of 2012: € 4 million)
- Profit for the period: loss of € 3 million (1st half-year 2012: break-even)
- Revenue 14% lower at € 496 million (1st half of 2012: € 575 million)
- Order book of € 1.6 billion (year-end 2012: € 1.8 billion)
- Operating profit forecast of approximately € 15 million for the full year 2013 upheld
Key figures first half year x EUR 1 million 2013 2012 2012 Revenue 496 575 1 296 EBIT 1 4 ( 31) Margin 0.2% 0.7% (2.4%) Profit before income tax ( 3) 1 ( 38) Profit for the period ( 3) - ( 41) Order book 1 567 1 899 1 761 Shareholders' equity 128 163 131 Solvency 18% 23% 17% Financing position ( 124) ( 104) ( 20)
Narrow operating profit for first half, and forecast for 2013 upheld
Ballast Nedam narrowly achieved an operating profit for the first half in steadily declining markets that are marked by cut-throat competition, price erosion and insolvencies. Excellent results were achieved on several large multiyear projects and in the niche markets. Ballast Nedam is accordingly focusing on the growth market of integrated projects and on niche markets such as industrial construction, offshore wind turbines, alternative fuels and secondary raw materials. The Government Buildings Agency's recent selection for the Penitentiaire Inrichting Zaanstad PPP project, and the City of Amsterdam's preliminary award of a 25-year area concession for the Food Center Amsterdam, endorse the strategic focus on integrated projects. Pending financial close, these and several other projects, such as the Westermeerwind nearshore wind turbine project and the E and F piers at Schiphol Airport Amsterdam, have yet to enter the order book.
The restructuring of the regional infrastructure companies is well on schedule, and the first signs of an improvement in the results are visible. The sustained decline in the residential housing construction market will entail a further capacity adjustment of the regional construction companies in the second half, in line with these market conditions. After taking the usual seasonal effects into account, several specialized companies that operate on capacity-driven markets performed poorly. Additional capacity adjustments to follow last year's restructuring are in preparation.
For the full year of 2013 we are upholding the previously announced forecast of an operating profit of approximately € 15 million.
first half year x EUR 1 million 2013 2012 2012 Revenue 199 209 496 EBIT 5 9 10 Margin 2.5% 4.3% 2.1% Order book 787 1 055 900 Assets 211 215 214
The pressure on the volume in the infrastructure market is undiminished. Competition is also increasing for the major projects and in the industrial construction niche market, whereas the offshore wind turbines niche market remained favourable.
In view of the market conditions, Infrastructure achieved a sound profit of € 5 million on a 5% lower revenue. The timing of the execution of the major projects last year has meant that most of the profit materialized in the first half.
Solid results were achieved on the major projects and in the niche markets. Although ongoing projects prevented the regional companies from contributing, the first signs of an improvement in the results are now visible. The strategic choice to abandon the regional procurement market for smaller traditional contracts, and to focus instead on the larger, more integrated projects, would also appear to have been vindicated. The capacity adjustment is on schedule, and is many times larger than the decline in market volume. Accordingly there will be less exposure to loss-making markets.
In recent years, offshore projects have become larger, further offshore, and in deeper water. In the coming years the offshore industry will focus on cost reduction, rising to 40% in 2020. Ballast Nedam is investing in cost reduction in offshore wind energy through innovation that is oriented to installing foundations for offshore wind turbines.
Internationally, we see opportunities in countries where we have operated for several years in projects with a civil engineering element. Our approach is also account-driven, with an emphasis on major clients with international operations.
Infrastructure's total assets declined somewhat relative to the first half and year-end 2012, to € 211 million.
The order book contracted in the first half by € 113 million to € 787 million, because of good progress on several large multiyear projects, running down capacity in the regional companies, and the absence of large multiyear project acquisitions in the past year. Nonetheless, the regional infrastructure operations in consortium won the Amsterdam-Rhine Canal bank restoration design & construct project, for more than € 30 million. Other successes in the first half were in the offshore wind turbines niche market, including the start of the Butendiek offshore wind turbine project in Germany, of more than € 250 million. The eighty foundations will be installed in 2014. A contract was also signed for the installation in the second half of this year of 39 foundations for the EnBW Baltic2 offshore wind farm in Germany. Yet to be entered in the order book is the Westermeerwind contract for the design, delivery and installation in 2015 of the foundations for 48 wind turbines for a wind farm in the Northeast Polder. Within the industrial construction niche market, several major projects, such as the Magnum multifuel generating plant for Nuon and the Biopower plants for Eneco, are in the final phase.
Ballast Nedam operates on the alternative fuels niche market through investment in fuel filling stations and their construction, management and maintenance. CNG Net and LNG24 invest in green gas public filling station networks for the private market, and LNG (liquefied natural gas) filling stations for the transport market. Last month CNG Net opened its 55th public filling station. CNG Net also manages ten custom filling sites for green gas customers, one of which is for a taxi, coach and contract transport provider in the province of Gelderland. LNG24 is investing in its second LNG filling station, which will open in the first quarter of 2014 in Delfgauw. This filling station will serve many urban goods transport operators whose fleets will run cleaner and more quietly on LNG.
Building & Development
first half year x EUR 1 million 2013 2012 2012 Revenue 232 263 573 EBIT 1 - ( 26) Margin 0.4% - (4.6%) Order book 654 693 731 Assets 300 361 314
The markets continued to deteriorate in the first half. This effect has been to increase the price pressure further. The door to the housing market is closed. Mortgages are still hard to come by, and the borrowing capacity of many households has fallen substantially. Pressure on the volume in the housing market increased further because of the cancellation or postponement of housing association projects. First-time buyers and student accommodation would now appear to be an exception to this rule. The current low production rate of newly built homes and the demographic trend mean that the housing market definitely has good prospects in due course. The long-term shortage is therefore increasing, in terms of both quantity and quality. The recovery in the office market will come later because of the current level of vacancy and the structural decline in the need for space per employee. There are interesting opportunities in the somewhat more stable renovation and maintenance market, and in the transformation of vacant property to different functions.
In the first half, Building & Development achieved an operating profit of € 1 million on a 12% lower revenue. The major complex projects made a fine contribution, property development broke even, and the regional construction companies made a loss. Capacity in the regional construction companies will be adjusted further in the second half in line with the current market conditions.
The order book contracted in the first half by 10% to € 654 million. In the first half, 35 recreational dwellings of the second phase of Nieuwvliet-Bad Beach Resort were added to the order book from internal development.
Sound progress was made in the first half on acquiring projects that will be entered into the order book in the second half of 2013, subject to the timing of the final award.
These include the new Food Center Amsterdam, the E and F piers at Schiphol Airport Amsterdam, and the development and construction of (Y)ours Leiden (the Leidse Schans campus).
The new Food Center Amsterdam involves a 25-year area concession that gives the consortium responsibility for the pace and the programme for this integrated area development. The programme will transform the current approximately 23.5 ha area into a new and up-to-date Food Center of approximately 100,000 m2 industrial site, the construction of approximately 1600 homes, and the restoration of the Central Market Hall, which is a listed building.
The work for Schiphol Airport Amsterdam's transition to central security comprises an overlay on the E and F piers and the construction of a terminal extension between them.
The construction of (Y)ours Leiden marks the resumption by Syntrus Achmea Real Estate & Finance of investment in homes for first-time buyers and students. (Y)ours Leiden will be the most sustainable student campus in Europe, with 1900 student apartments, 205 homes for first-time buyers, and associated facilities.
More good news, and entirely in line with the strategic focus on the integrated projects growth market, is the Government Buildings Agency's proposal to select the Pi2 consortium, which includes Ballast Nedam (65%) and Royal Imtech (35%), as the candidate for the Penitentiaire Inrichting Zaanstad PPP project. This project will involve the design, new construction, maintenance, financing and technical facilities management for a period of 25 years following availability. The project has a nominal value of approximately € 300 million. Ballast Nedam is the sole shareholder of this PPP project.
In June, Ballast Nedam, eight housing associations and three major construction companies signed the 'Acceleration' innovation deal, for the sustainable renovation of 111,000 rented homes. The contract stipulates that with a feasible business case the first 11,000 homes will be renovated in a guaranteed sustainable manner by the four participating construction companies .
The assets of Building & Development were € 300 million, which is € 14 million lower than at year-end 2012.
The residential construction operations declined by 200 homes to 1 101 under construction at year-end 2012 to 901. In the first half, 209 homes were taken into construction, 39 of which from internal property development, and 409 homes were completed.
Property development Exposure property development first half year x EUR 1 million 2013 2012 2011 2010 Land positions 145 152 154 160 Unsold stock under construction 5 6 13 12 Unsold stock delivered 17 18 12 27 Total on balance 167 176 179 199 Liabilities to complete projects under construction 2 1 7 3 Liabilities to acquire land positions 39 39 24 30 Total liabilities off-balance 41 40 31 33 Exposure property development 208 216 210 232
The total property development exposure, which consists of investments in land positions, investments in unsold stock and related future liabilities, decreased in the first half by € 6 million to € 206 million. Our aim to lower the capital invested in property in the next few years will be hard to achieve in view of the sustained poor market conditions and the ongoing purchase commitments of € 39 million. Of this, € 22 million will fall in the 2014 - 2018 period inclusive, and € 17 million in 2019 and later.
The total investment in unsold stock, both delivered and under construction, decreased in the first half by € 2 million to € 22 million. The number of unsold homes went down from 67 at year-end 2012 to 53, of which the number of completed homes decreased by ten in the first half to 46, spread over 13 projects. Besides these 46 homes, among the delivered unsold stock there was also 4 112 m² leased and 1 000 m² unleased commercial property.
first half year x EUR 1 million 2013 2012 2011 2010 Opening 152 154 160 157 Net investment ( 7) 19 2 7 Write-down - ( 21) ( 8) ( 4) Closing 145 152 154 160
The land positions decreased by € 7 million to € 145 million, which consisted mainly of the sale of a land position with construction rights in Nijmegen, and the taking into construction of the second phase of the Nieuwvliet-Bad Beach Resort area development. There were no asset write-downs in the first half.
first half year x EUR 1 million 2013 2012 2012 Revenue 114 102 262 EBIT ( 4) ( 3) ( 10) Margin (3.5%) (2.9%) (3.8%) Order book 107 112 90 Assets 113 130 131
Market volume for the specialized companies was pulled downward by the markets for infrastructure and construction. Revenue for the first half increased by € 12 million to € 114 million because of higher revenue from the Ballast Nedam projects. Specialized Companies made an operating loss of € 4 million. Alongside the seasonal effects, some companies that operate on capacity-driven markets performed poorly. Additional capacity adjustments to follow last year's restructuring are in preparation.
In the alternative fuels niche market Ballast Nedam has won a follow-on contract for the construction and maintenance of a hydrogen filling station for the Flemish-Dutch WaterstofNet, this time for the first 700-bar hydrogen filling station in the Netherlands. This filling station type is compatible with the new generation of hydrogen-fuelled passenger cars that will be put on the market. Ballast Nedam is to supply a professional home-base CNG installation to the Portuguese energy company EDP. The installation will allow the fleet of twenty new natural gas vehicles to be refuelled rapidly and conveniently on EDP's own site in Porto. The installation will be delivered on a turnkey basis in August 2013 in collaboration with a Portuguese partner.
Ballast Nedam has also entered into framework contracts with NUON, DSM, Zonline and others for the installation of solar panels for private customers under a collective purchasing scheme.
The assets of Specialized Companies were € 113 million, which is € 17 million lower than in the first half of 2012. This decline is attributable to a lower working capital.
The order book grew in the first half by € 17 million to € 107 million because of a higher portfolio for internal major projects.
first half year x EUR 1 million 2013 2012 2012 Revenue 78 91 216 EBIT 1 1 2 Margin 1.3% 1.1% 0.9% Order book 61 70 56 Assets 198 204 205
The volumes in the markets for sandstone and Bestone in the offshore, asphalt and rail construction industries and for reprocessed raw materials remained reasonably stable. The high pressure on the volumes of raw materials for the concrete industry and the prefabricated product market was undiminished.
The revenue of Supplies went down by € 13 million to € 78 million because of low revenues in the prefabricated concrete companies. Supplies accordingly achieved an unchanged operating profit of € 1 million.
The order book grew in the first half by € 5 million to € 61 million because of a higher order book for the prefabricated concrete companies.
In the autumn of 2013 work will start on the 'New Life in the Lus van Linne' project. In close collaboration with the Limburg Landscape Foundation, the Municipalities of Roermond and Maasgouw and the residents, Ballast Nedam will redevelop the area in the Lus van Linne in phases over the next fifteen years, into 200 hectares of river nature that is home to a wide range of species, various recreational facilities and flood protection measures. This redevelopment will be combined with estimated resource extraction of 10 million tons of sand and gravel.
Ursem Modular Building Systems is supplying modular bathrooms for the almost 600 student apartments in the (Y)ours Leiden project. Thirty iQwoning® homes were produced in the first half of 2012 for the renovation of the Patrimonium district of Hillegom for the housing association Stek. The homes are ready for assembly on site in mid August, immediately after the renovation phase. Of the thirty newly built homes, six are for sale. The iQwoning® homes will be ready for the new residents to move in by the end of the year. Stek selected iQwoning® for this project to keep the disturbance to local residents to a minimum, in view of the limited nuisance that is caused during the very brief construction period.
The assets of Supplies were € 198 million, which is 6 million lower than in the first half of 2012.
first half year x EUR 1 million 2013 2012 2012 Infrastructure 199 209 496 Building & Development 232 263 573 Specialized Companies 114 102 262 Supplies 78 91 216 623 665 1 547 Other ( 127) ( 90) ( 251) 496 575 1 296
The revenue for the first half went down by 14% to € 496 million. For the full year 2013 we expect an approximately unchanged revenue compared with 2012, where the revenue of Infrastructure will be higher and that of Building & Development lower.
first half year x EUR 1 million 2013 2012 2012 Infrastructure 5 9 10 Building & Development 1 - ( 26) Specialized Companies ( 4) ( 3) ( 10) Supplies 1 1 2 3 7 ( 24) Other ( 2) ( 3) ( 7) 1 4 ( 31)
Operating profit decreased from € 4 million for the first half of 2012 to € 1 million. The profit of the segments decreased because of deteriorating market conditions and the fact that most of last year's Infrastructure profit fell in the first half. The 'Other' result consisted mainly of holding company costs. The first half included a partial reversal of the provision for the cost of restructuring.
first half year 2013 2012 2012 Infrastructure 2.5% 4.3% 2.1% Building & Development 0.4% - (4.6%) Specialized Companies (3.5%) (2.9%) (3.8%) Supplies 1.3% 1.1% 0.9% 0.2% 0.7% (2.4%)
The overall margin fell on a half-year basis from 0.7% to 0.2%.
Profit for the period
first half year x EUR 1 million 2013 2012 2012 EBIT 1 4 ( 31) Net finance income and expense ( 4) ( 3) ( 7) Profit before income tax ( 3) 1 ( 38) Income tax expense - ( 1) ( 3) Profit for the period ( 3) - ( 41)
The financing item was € 4 million, which was € 1 million higher than for the first half of 2012, and was attributable to higher financing of working capital. Profit before income tax was € 4 million lower than for the first half of 2012. The profit for the period declined from break even in the first half of 2012 to a net loss of € 3 million.
first half year x EUR 1 million 2013 2012 2012 Infrastructure 787 1 055 900 Building & Development 654 693 731 Specialized Companies 107 112 90 Supplies 61 70 56 1 609 1 930 1 777 Other ( 42) ( 31) ( 16) 1 567 1 899 1 761
The order book contracted in the first half by € 194 million to € 1 567 million. Of these orders, approximately € 0.9 billion will be executed in 2014 and later. The capacity was adjusted last year, and is now more compatible with the smaller size of the order book. The quality and the composition of the total order book allow for continued disciplined tendering.
Equity and cash flows
Solvency improved slightly from 17% at year-end 2012 to 18%. The above solvency is calculated using the method that accounts for joint ventures by recognizing the share in the assets (i.e. the equity method). The solvency calculated in accordance with the proportionate consolidation method that is currently allowed under IFRS and is applied for the joint ventures, such as the PPP projects, remained unchanged at 15% through the first half.
Ballast Nedam's shareholders' equity decreased in the first half by € 3 million to € 128 million because of the profit for the period achieved.
Total assets decreased relative to the first half of 2012 by € 100 million to € 838 million, mainly because of the sale of a PPP project and the impairment losses taken in the second half of last year. Capital employed increased in the first half by € 80 million because of lower current liabilities and fewer prepayments.
The cash flow for the first half of 2013 was € 101 million negative against € 85 million negative for the first half of 2012. This is consistent with the normal seasonal pattern, but was higher because of € 8 million of loans that were repaid in the first half, compared with a € 24 million net increase in long-term loans that was recognized in the first half of 2012.
The operating cash flow of € 84 million negative was approximately equal to the negative operating cash flow of € 81 million for the first half of 2012.
The cash flow from investing activities was € 9 million negative compared with € 24 million negative for the first half of 2012, and consisted of € 9 million of investments. There were no disposals. The € 7 million net investment in property, plant and equipment was lower than the € 9 million of depreciation.
The negative cash flow from financing activities of € 8 million consisted of long-term loan repayments.
x EUR 1 million 2013 2012 2012 Cash and cash equivalents 37 42 84 Bank overdrafts ( 62) ( 40) ( 8) Net cash ( 25) 2 76 Recourse loans ( 99) ( 106) ( 96) Financing position ( 124) ( 104) ( 20) Non-recourse loans ( 11) ( 51) ( 29) Financing position including non-recourse ( 135) ( 155) ( 49)
The financing position increased from a debt of € 104 million in the first half of 2012 to a debt position of € 124 million. However, the financing position including the non-recourse loans improved by € 20 million from a debt position of € 155 million in the first half of 2012 to € 135 million. Net cash decreased by € 27 million to a debt position of € 25 million because of higher utilization of the loans for working capital. Relative to year-end 2012 the financing position decreased by € 104 million to a debt position of € 124 million. The financing requirement is always higher in the course of the year than at year-end.
One of the strategic objectives for 2013 is to improve the financial position through the sale of property and assets, among other means. In the first half an office building in Zaandam was sold and the process of selling the participation in Beheersmaatschappij Bontrup was started. The process of selling the raw materials company Yvoir is in the final phase.
first half year x EUR 1 million 2013 2012 2012 PPP loans 6 42 6 Land bank financing 42 48 44 Business loans 51 50 51 Finance leases 6 8 7 Other loans 5 9 17 110 157 125 Recourse 99 106 96 Non recourse 11 51 29 110 157 125 Current loans 9 10 17 Long-term loans 101 147 108 110 157 125
There will be no need to refinance the long-term loans in the coming years. The business loan of € 50 million expires in April 2017, has a fixed interest rate of 5.4%, and mortgages have been taken out on several properties in use by Ballast Nedam as security. The other large loan of € 33 million is mainly for financing several land positions in a separate company. This loan matures in October 2015 and the interest rate is Euribor plus a margin.
The long-term loans were € 15 million lower than at year-end 2012 because of repayment of € 8 million and inclusion of a portion under liabilities for sales. Relative to the first half of 2012, the loans decreased by € 47 million, in particular because of the sale of a PPP project. There is no opportunity of recourse on Ballast Nedam for € 11 million of the € 110 million of long-term loans.
Risks and uncertainties
The profit to be achieved in the remaining period of 2013 may be affected upward or downward, in particular by the outcomes of claims concerned with a limited number of projects and changes in the overall market.
Of the risks identified in the 2012 Annual Report, the economic risks in the sector, the political risks, the financial risks and the operating risks have generally increased.
Our order book includes approximately € 75 million of orders that might not go ahead if the customer is unable to complete the financing.
Statement of the Board of Management
To the best of the Board of Management's knowledge, the half-year financial statements give a true and fair view of the assets, liabilities, financial position and profit of Ballast Nedam N.V. and the undertakings included in the consolidation taken as a whole. To the best of the Board of Management's knowledge, the half-year financial statements give a fair review of the material events in the first half-year and their effect on the half-year financial statements, a fair account of the main risks and uncertainties for the remaining periods of the year, and a fair review of the material transactions with associates.
Nieuwegein, 12 July 2013
Board of Management
P. van Zwieten
Consolidated income statement
x EUR 1 million first half year 2013 2012 2012 Revenue 496 575 1 296 Other operating income - - 4 Costs of raw materials and subcontractors ( 336) ( 392) ( 952) Personnel expenses ( 137) ( 143) ( 289) Other operating expenses ( 12) ( 25) ( 57) ( 485) ( 560) (1 298) Share in profits of associates - - - Earnings before interest. taxes. depreciation and amortization (EBITDA) 11 15 2 Depreciation and amortization of property. plant and equipment and intangible assets ( 10) ( 10) ( 23) Impairment of tangible and intangible assets - ( 1) ( 10) Earnings before interest and taxes (EBIT) 1 4 ( 31) Finance income - 1 3 Finance expense ( 4) ( 4) ( 10) Net finance income and expense ( 4) ( 3) ( 7) Profit before income tax ( 3) 1 ( 38) Income tax expense - ( 1) ( 3) Profit for the period ( 3) - ( 41) Attributable to owners of the company: Basic earnings per share (EUR) 0.31 # 0.36 -4.24 Diluted earnings per share (EUR) 0.31 # 0.36 -4.24 Consolidated statement of comprehensive income x EUR 1 million first half year 2013 2012 2012 Profit for the period ( 3) - ( 41) Other comprehensive income: Foreign currency translation differences - - - Net changes in hedging reserve - ( 4) 5 Total comprehensive income for the period ( 3) ( 4) ( 36) Attributable to: Owners of the company ( 4) ( 36) Non-controlling interests - - - Total comprehensive income for the period ( 3) ( 4) ( 36)
Consolidated statement of financial position
x EUR 1 million first half year 2013 2012 2012 Non-current assets Intangible assets 30 35 31 Property. plant and equipment 152 180 169 Financial assets 10 50 11 Disposals of associates 3 3 2 Deferred tax assets 32 36 32 227 304 245 Current assets Inventories 189 220 202 Work in progress 110 102 112 Receivables 240 270 239 Cash and cash equivalents 37 42 84 Assets held for sale 35 4 611 634 641 Current liabilities Bank overdrafts ( 62) ( 40) ( 8) Loans ( 9) ( 10) ( 17) Prepaid on inventories ( 2) ( 1) ( 1) Work in progress ( 98) ( 152) ( 124) Trade payables ( 201) ( 190) ( 253) Income tax expense ( 1) ( 1) ( 2) Other liabilities ( 180) ( 173) ( 188) Provisions ( 26) ( 35) ( 39) Liabilities held for sale ( 20) ( 2) ( 599) ( 602) ( 634) Current assets minus current liabilities 12 32 7 239 336 252 Non-current liabilities Loans 101 147 108 Derivatives 1 13 1 Deferred tax liability 4 4 4 Personnel expenses 4 5 4 Provisions 1 4 4 111 173 121 Total shareholders' equity Equity attributable to owners of the company 128 163 131 Non-controlling interest - - - 128 163 131 239 336 252
Summary consolidated statement of changes in equity
x EUR 1 million first half year 2013 2012 2012 Share capital 60 60 60 Share premium 52 52 52 Reserves 19 49 59 Opening 131 161 171 Foreign currency translation differences - - - Net change in hedging reserve - ( 4) 5 Other comprehensive income - ( 4) 5 Profit for the period ( 3) 4 ( 41) Dividend paid - ( 4) ( 5) Other - - 1 Closing 128 163 131
Consolidated statement of cash flows
x EUR 1 million first half year 2013 2012 2012 Net cash - opening balance 76 87 87 Profit for the period ( 3) - ( 41) Adjustments: Depreciation 9 10 23 Amortization 1 - - Impairment (in)tangible assets - 1 10 Finance expense 4 4 10 Finance income - ( 1) ( 3) Share-based payments - - 1 Gain from disposal of fixed assets and subsidiaries - - - Income tax expense - 1 3 Share in profits of associates - - - Movements: Movement in inventories 5 ( 9) 6 Movement in work in progress ( 24) ( 8) ( 46) Movement in other receivables ( 12) ( 7) 24 Movement in provisions and employee benefits ( 13) ( 3) ( 2) Interest paid ( 4) ( 4) ( 7) Paid on hedging instruments - - ( 3) Interest received - - - Income taxes paid - - ( 1) Change in other current liabilities ( 47) ( 65) 27 Net cash from operating activities ( 84) ( 81) 1 Intangible assets investments ( 1) ( 1) ( 2) disposals - - 1 Property. plant and equipment investments ( 7) ( 8) ( 23) disposals - 2 8 Financial assets investments - ( 17) ( 41) disposals - 4 - dividends received - - 1 income from other receivables - - - Disposals of associates ( 1) ( 1) - Disposal of subsidiaries after deduction of disposed cash and cash equivalents - ( 3) ( 4) Sale of subsidiaries after deduction of disposed cash and cash equivalents - - - Net cash used in investing activities ( 9) ( 24) ( 60) Income from long-term loans drawn - 34 62 Repayment of long-term loans ( 8) ( 10) ( 7) Handling charges paid on new loans - - - Finance lease instalments paid - - ( 2) Acquisition of non-controlling interest - - - Dividend paid - ( 4) ( 5) Proceeds from repurchase of own shares - - - Net cash from financing activities ( 8) 20 48 Effect of exchange rate fluctuations on cash held - - - Net cash - closing balance ( 25) 2 76
x EUR 1 million first half year 2013 2012 2012 Cash and cash equivalents 37 42 84 Bank overdrafts ( 62) ( 40) ( 8) Net cash ( 25) 2 76 Fully consolidated ( 45) ( 13) 63 Proportionately consolidated 20 15 13 Net cash ( 25) 2 76 Net financing position x EUR 1 million first half year 2013 2012 2012 Net cash ( 25) 2 76 Current portion of long-term loans ( 9) ( 10) ( 17) Long-term loans ( 101) ( 147) ( 108) ( 135) ( 155) ( 48)
Non-proportionately consolidated statement of financial position
Proportionately consolidated Not proportionately consolidated x EUR 1 million first half year first half year 2013 2013 2012 2012 Non-current assets Intangible assets 30 26 29 25 Property. plant and equipment 152 137 152 141 Financial assets 13 33 11 41 Deferred tax assets 32 32 33 32 227 229 225 239 Current assets Inventories 189 154 176 165 Work in progress 110 91 92 96 Receivables 241 205 216 199 Cash and cash equivalents 37 16 15 68 Assets held for sale 35 20 4 611 486 499 532 Current liabilities Bank overdrafts ( 62) ( 55) ( 28) - Loans ( 9) ( 5) ( 4) ( 8) Prepaid on inventories ( 2) ( 1) - - Work in progress ( 98) ( 56) ( 86) ( 63) Trade payables ( 201) ( 143) ( 130) ( 183) Income tax expense ( 1) - ( 1) ( 2) Other liabilities ( 180) ( 202) ( 177) ( 244) Provisions ( 26) ( 24) ( 32) ( 35) Liabilities held for sale ( 20) ( 4) ( 2) ( 599) ( 490) ( 458) ( 537) Current assets minus current liabilities 12 ( 4) 41 ( 5) 239 225 266 234 Non-current liabilities Loans 101 90 93 93 Derivatives 1 - - - Deferred tax liability 4 2 3 2 Personnel expenses 4 3 5 4 Provisions 1 2 2 4 111 97 103 103 Total shareholders' equity Equity attributable to owners of the company 128 128 163 131 Non-controlling interest - - - - 128 128 163 131 239 225 266 234 Solvency 15% 18% 23% 17%
Notes to the half-year financial report
Significant accounting policies
Ballast Nedam N.V. is based in Nieuwegein in the Netherlands. The half-year financial report of Ballast Nedam N.V, is concerned with the first six periods of the 2013 financial year from 1 January 2013 to 16 June 2013, inclusive (2012: 2 January to 17 June, inclusive). This report comprises Ballast Nedam N.V., (the head of the group) and its subsidiaries (jointly referred to as Ballast Nedam) and Ballast Nedam's interest in associates and entities over which there is joint control.
The consolidated accounts of Ballast Nedam N.V. for financial year 2012 are available on http://www.ballast-nedam.com.
Statement of compliance
The half-year financial report has been prepared in accordance with International Financial Reporting Standard IAS 34 'Interim Financial Reporting' as adopted by the European Union (hereinafter referred to as: 'EU-IFRS'). The half-year financial report is not audited. The half-year financial report does not comprise all the information required for the full annual financial statements and must be read in conjunction with the consolidated financial statements for 2012.
This half-year financial report was drawn up and approved by the Board of Management on 12 July 2013.
Accounting policies used in the half-year financial report
The accounting policies used in the half-year financial report are consistent with those set down in the annual financial statements for 2012.
The Board of Management regularly uses information of individual segments in order to make decisions about resources to be allocated and to assess performance. The decisions about resources to be allocated and the assessment of performance are based on earnings before interest and taxes and capital employed.
Ballast Nedam is subject to the usual seasonal pattern within the construction industry, which has an effect on the reported profit, statement of financial position and cash flows. From a historical perspective, revenue and operating profit in the first half are lower than in the second half of any year. The demands on working capital and the net debt are generally higher at mid-year than at year-end.
Related party transactions
The parties related with Ballast Nedam are the company's key management (Board of Management and Supervisory Board), its subsidiaries, associates, joint ventures, the Stichting Pensioenfonds Ballast Nedam, and the directors and senior officials of these entities.
The main task of the Ballast Nedam Pension Fund is to implement the pension scheme for Ballast Nedam employees. The Ballast Nedam Pension Fund uses the services of Ballast Nedam companies. The actual costs are charged on.
Ballast Nedam buys and sells goods and services from and to various related parties in which Ballast Nedam holds an interest of 50% or less, or with natural persons and legal entities that hold at least 10 per cent of the shares in Ballast Nedam. All these transactions are conducted at arm's length, in a way comparable with that for transactions with third parties.
An operating segment is a component of Ballast Nedam that engages in business activities that may contribute substantially to revenues and expenses, including those related to transactions with other components of the Group.
The Board of Management regularly uses information of individual segments in order to make decisions about resources to be allocated and to assess performance.
The amounts for transactions between segments are determined on an arm's length basis. The results, assets and liabilities of a segment comprise items that can be attributed to the segment either directly or on a reasonable basis.
Fair value measurement of financial instruments
Ballast Nedam makes limited use of derivative financial instruments in order to hedge exposure to currency, interest rate and market risks arising from operating, financing and investing activities. Ballast Nedam makes use of hedge accounting to hedge the interest rate risk on its PPP loans. In the first half there were no material changes in fair value relative to year-end 2012. The hedges are assessed for effectiveness each quarter. In the first half Ballast Nedam's total share in the PPP loans was € 6 million. The interest rate risk on these loans is fully covered. The hedges were still effective in the first half, so that this did not give rise to any change in Ballast Nedam's income statement.
Accounting estimates and judgements
In preparing the half-year financial report, the management of Ballast Nedam has made estimates and judgements that affect the amounts recognized for assets, liabilities, revenue, costs and the related notes.
The valuation of work in progress is based on forecasts of the final project results. The ultimate outcome may differ from these forecasts.
Recognition of deferred income tax assets
At the close of the period, Ballast Nedam makes an assessment of the income tax position of all fiscal entities. This involves estimating the actual short-term tax charges and income, and the temporary differences between the accounting carrying amounts and tax base of assets and liabilities. A decision is taken at the end of the reporting period as to whether unused tax losses and deferred tax assets due to temporary differences may be recognized. Ballast Nedam recognizes the portion of deferred tax assets that will probably be realized. The utilization of carry-forward losses depends on future taxable profits and any tax planning opportunities. If the actual anticipated taxable profits differ from the estimates, and depending on the tax strategies that Ballast Nedam may implement, taxable losses that have been recognized may not be realized, thus affecting the financial position and results of Ballast Nedam.
Provisions relating to legal or constructive obligations are based on estimates and judgements as to whether the criteria for treatment as a provision have been met, including an estimate of the size of the obligation. Legal or constructive obligations are disclosed if it is likely that an obligation will arise and its size can be reasonably estimated. If the actual outcome differs from the assumptions as to anticipated costs, the estimated provisions will be revised, and this could have an effect on the financial position and results of Ballast Nedam.
Events after the reporting period
Nieuwegein, 12 July 2013
Board of Management,
P. van Zwieten
The figures on which this press release was based are not audited. This press release is for information purposes only. The forecasts and outlook presented in this press release are given with no form of guarantee whatsoever of their future achievement. This press release contains forward-looking statements, including with respect to intentions and outlook, which are based on current views and assumptions and are subject to known and unknown risks, uncertainties and other factors that are largely outside Ballast Nedam N.V.'s control, and which could cause the actual results or achievements to differ materially from the future results or achievements expressed or implied by the forward-looking statements. Ballast Nedam N.V. disclaims any obligation to update or amend the forward-looking statements in the light of new information, future events or for any other reason whatsoever, except as required by applicable laws and regulations, or on the authority of a competent regulatory body.
Ballast Nedam engages in integrated projects in The Netherlands in four areas of work: housing, mobility, energy and nature. Within this area we focus on the niche markets: industrial construction, offshore wind turbines, secondary raw materials and alternative fuels. In a number of areas of expertise, we also operate internationally. The Ballast Nedam share is included in the Amsterdam Small Cap Index (AScX) of NYSE Euronext.
Ballast Nedam's approach is based on life cycle thinking and acting: we develop, construct, manage and recycle. We are involved in long-term management, maintenance and operation of projects and organize financial feasibility. Our supply and specialized companies deliver competitive edge through innovation, cost leadership and purchasing strength. Ballast Nedam's range of services is shifting towards modular products and specific product-market combinations with greater added value.
Ballast Nedam creates enduring quality combined with lower life cycle costs for its customers and society. http://www.ballast-nedam.com
SOURCE Ballast Nedam