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Boskalis Enjoys Dredging Renaissance
01 May 2006
The current good fortunes of the global dredging market are reflected in the 2005 results announced by Dutch giant Royal Boskalis Westminster, which has reported a spectacular 85% rise in net profit to 62.7m and a record turnover of 1,156m which was up 13% over 2004.
Acknowledging a positive turnaround for the international dredging market, Boskalis cited a sizeable demand for marine infrastructure driven by growing energy markets and expanding world trade as the reason for recovery. Not only was turnover and profit up, Boskalis also enjoyed a 2.34b intake of new orders and saw their order book stuffed to a historical high of 2.43b at year end.
Boskalis CEO Rob van Gelder commented, '2005 was a top year as regards turnover and acquired orders. Our results recovered, particularly thanks to higher turnover and better fleet utilisation.
All segments performed better.
I am optimistic about the coming years. We are going to invest and benefit from the robust demand in our market.'
Including participating interests, Boskalis expects to invest some 800m over the next five years.
The company is allowing for the possibility that market demand could actually exceed available capacity in the short term, meaning that a policy of selective contracting will continue. It was acknowledged that margins were still modest as much work remains in the order book which was contracted during tighter recent times.
The results delivered good news for Boskalis' shareholders as the company's policy of distributing 30 to 40% of the net result in dividend has been adjusted upwards to a pay-out ratio of 40 to 50%, delivering a cash dividend of 1.10 per share for 2005.
The international dredging market is currently growing strongly and heavy fleet utilisation is expected in the coming years.
Boskalis is aiming for structural growth in turnover of 5 to 10% per year and a return on equity of 12%. These aims, combined with the ageing of dredging vessels, means investment in expansion and replacement of equipment will be necessary.
A close watch will be kept on capacity requirements in various market segments, as well as on costs and timings, so that the investments will have an optimum effect on the company's returns and competitiveness.
One means of growth and capacity expansion for which Boskalis has long been noted is acquisition. Boskalis has extended this habit with the acquisition of the dredging fleet and activities of Dutch contractor D. Blankevoort International Dredging Company.
The acquisition will bring some 80 experienced staff and three additional trailing suction hopper dredgers with capacities of 2,500m 3,3,000m 3and 4,700m 3for worldwide deployment.
MJInformation No: 21816
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