Compagnie d'Entreprises CFE : FIRST HALF RESULTS 2021

PRESS RELEASE

Tuesday 31 August 2021 - 7:00 CET

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First half results 2021

Tuesday 31 August 2021 - 7:00 CET regulated information

First half results 2021

• 9.3% revenue growth
• EBITDA at pre-Covid level
• EBIT higher than first half of 2019
• Order book at record level
• Improved prospects for 2021: substantial increase in revenue to a level close to that of 2019. Net result also expected to increase significantly compared with 2020 without yet attaining the pre-Covid level.

1. Key figures in the first half of 2021

For the period ended June 30		2021			2020			Change
(€ millions)
Revenue		1,629.9			1,491.2			+9.3%
Self-financing capacity (EBITDA) (*)		206.5			159.8			+29.2%
% of revenue
	12.7%			10.7%
Operating income (EBIT) (*)		64.1			19.3			+232.1%
% of revenue
	3.9%			1.3%
Result for the period - share of the group		42.6			8.4			+407.1%
% of revenue
	2.6%			0.6%
Earnings per share (share of the group) (in euro)		1.68		0.33			+409.1%
(	€ millions)		June 30, 2021			December 31,			Change
			2020
Equity - share of the group		1,819.8			1,787.1			+1.8%
Net financial debt (*)		722.8			601.4			+20.2%
Order book (*)		6,262.2			6,049.1			+3.5%

(*) The definitions are included in the 'Consolidated Financial Statements' section of the financial report.

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Tuesday 31 August 2021 - 7:00 CET regulated information

General introduction

Revenue in the first half of 2021 amounted to € 1,629.9 million, up 9.3% compared with last year. The increase in activity was observed in the three operational segments.

EBITDA amounted to € 206.5 million. This represents 12.7% of the revenue and increased by € 46.7 million compared with that of the first half of 2020, which included the capital gain on disposal of the stake in the Merkur wind farm (€ 63.9 million). The EBITDA returned to its level of the first half of 2019 (€ 207 million).

The operating income in the first half of 2021 amounted to € 64.1 million, exceeding the level reached before the pandemic (€ 61.2 million in the first half of 2019).

The net result, share of the group, amounted to € 42.6 million, which is fivefold compared to that of the first half of 2020. The three operational segments contributed to the very strong growth of the net result.

Equity (share of the group) stood at € 1,819.8 million on 30 June 2021, which is up 1.8% compared with 31 December 2020. In May 2021, CFE paid a dividend of € 25.3 million in respect of the 2020 financial year.

The net financial debt amounted to € 722.8 million on 30 June 2021, compared with € 803 million on 31 June 2020 and € 601.4 million on 31 December 2020. All the financial covenants have been complied with on 30 June 2021.

On 30 June 2021, the order book increased compared to 31 December 2020 and reached a record level of € 6.3 billion.

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Tuesday 31 August 2021 - 7:00 CET regulated information

2. Analysis by segment

Dredging, Environment, Offshore and Infra segment

KEY FIGURES

For the period ended June 30		2021			2020		Change
(€ millions)
Revenue		1,063.0		1,047.9		+1.4%
EBITDA (*) (**)		187.2		153.8		+21.7%
Operating income (EBIT) (*) (**)		51.0		21.9		+132.9%
Result for the period - share of the group (*)		35.0		15.5		+125.8%

(
€ millions)		June 30, 2021	December 31, 2020	Change
Net financial debt (**)		564.0		489.0			+15.3%
Order book (**)		4,737.0		4,500.0			+5.3%

(*) Excluding amounts restated to take account of the recognition at fair value of the identifiable assets and liabilities of DEME following the acquisition of an additional 50% of the DEME shares on 24 December 2013.

(**) The definitions are included in the 'Consolidated Financial Statements' section of the financial report.

REVENUE

DEME's revenue in the first half of 2021 amounted to € 1,063 million, which is slightly up on the first half of last year.

The Dredging division reported a solid growth of revenue in the first half of 2021: +18% compared with the first half of 2020, or € 507.2 million. The main project in progress is the extension of the port of Abu Qir (Egypt), on which several vessels are deployed. In Europe, DEME successfully finalised the project for the widening and deepening of the Elbe, while work on the access channel to the port of Swinoujscie (Poland) is progressing well. Maintenance dredging activity is mainly concentrated in Belgium, Germany and Africa.

The utilisation capacity of the hopper dredger fleet reached a highly satisfactory level (19.2 weeks compared with 16.8 weeks in the first half of 2020). Despite slight progress, the activity level of the cutters remained low in the first half of 2021 (7.4 weeks utilisation). However, this is set to improve significantly in the second half of the year in particular thanks to the Abu Qir project.

DEME Offshore's revenue amounted to € 335 million in the first half of 2021 (€ 434.6 million in the first half of 2020). As was pointed out earlier, the main projects to be realised in 2021 are mostly in the start-up phase, such as Hornsea 2 (United Kingdom) and Saint-Nazaire (France), where the jack-up vessel 'Innovation' successfully installed the first monopiles using an underwater drill. The share of revenue relating to procurement was extremely limited in the first half of 2021.

DEME Offshore will realise a substantially higher revenue in the second half of the year. Nevertheless, as was said before, 2021 and 2022 will be a period of transition for DEME Offshore before a projected strong growth from 2023 onwards with the start of the projects in Taiwan and the United States.

DEME Infra reported € 119.9 million revenue in the first half of 2021. The three Dutch projects (Terneuzen lock, RijnlandRoute and the Blankenburg connection), which represent a substantial part of the business volume, are making satisfactory progress.

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					Tuesday 31 August 2021 - 7:00 CET
							regulated information
BREAKDOWN OF ACTIVITY BY BUSINESS AREA
	For the period ended June 30			2021			2020
Capital dredging		36%			28%
Maintenance dredging		12%			13%
Offshore		32%			41%
Infra		11%			10%
Environment		6%			6%
Others		3%			2%
BREAKDOWN OF ACTIVITY BY GEOGRAPHICAL AREA
	For the period ended June 30			2021			2020
Europe (EU)			53%			73%
Europe (non-EU) (*)			21%			3%
Africa			20%			7%
Americas			1%			3%
Asia-Pacific			4%			9%
Middle East			0%			1%
Indian subcontinent			1%			4%

* As a result of Brexit, business carried out in the United Kingdom is included under Europe (non-EU) as of 1 January 2021.

EBITDA AND OPERATING INCOME (EXCLUDING RESTATEMENTS)

EBITDA amounted to € 187.2 million in the first half of 2021 (17.6% of revenue), up by 21.7% compared to the first half of 2020, which included a capital gain of € 63.9 million (disposal of the stake in the Merkur wind farm) and was also impacted by the health crisis and the accident with the Orion, the cost of which is estimated at € 60 million.

Nevertheless, the effects of the pandemic continue to disrupt the execution of projects, albeit to a lesser extent than in 2020. It is mainly the activities outside Europe that are most affected due to travel restrictions and quarantine measures that remain in place in many countries.

The improvement of the EBITDA is especially noticeable in the Dredging division, which succeeded in winning some major contracts that have a favourable impact on revenue and fleet utilisation. Conversely, the temporarily lower level of activity in Offshore weighed on the division's results, as does the unavailability of the vessel 'Orion' following the accident in May 2020. The 'Orion' will not be operational until the end of the first quarter of 2022.

DEME Concessions continues to invest large sums of money (€ 13.1 million in the first half of 2021, which have been expensed) in the collection of nodules. In April 2021, GSR, a subsidiary of DEME, deployed its deep-sea robot PATANIA II at a depth of 4,500 metres in the Clarion-Clipperton fracture zone in the South Pacific. The test campaign of the PATANIA II was a success: the deep-sea robot demonstrated its ability to drive, manoeuvre and collect polymetallic nodules on the seabed.

The operating income (EBIT), which includes the results of the equity-accounted companies, amounted to € 51.0 million, up by 132.9% compared with the first half of 2020.

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