Annual Report Revenue Net result attributable to Year-end order book (in € million) shareholders (in € million) (in € million) 10,000 300 14,000 12,000 8,000 200 13,100 8,835 10,000 8.646 8,324 12,100 7.770 11,100 7,697 7,611 11,000 6,000 7,404 100 161.9 8,000 10,400 126.0 31.3 15.3 6,000 4,000 0 4,000 -187.4 2,000 -100 2,000 0 -200 0 08 09 10 11 12 08 09 10 11 12 08 09 10 11 12 Equity/capital base Net result per share Dividend per ordinary share (in € million) (fully diluted) (in €) (in €) 1,400 1.80 0.60 1,200 1,362 0.50 1,302 1.20 1,000 0.50 1,162 1.20 0.40 1,098 1,100 1,077 800 0.60 1,045.4 875 921.9 847 0.18 0.30 0.54 600 0.08 0.00 0.20 400 -0.79 -0.60 0.10 200 0.16 0.03 0.10 0.10 0 -1.20 0.00 08 09 10 11 12 08 09 10 11 12 08 09 10 11 12* Equity Capital base *proposal Revenue by sector year-end 2012 Order book by sector year-end 2012 Result before taxes as percentage of revenues by sector 2012 2011 6% 7% 7% 9% Construction and M&E services 1.4% 2.2% Civil engineering 1.5% 2.4% 41% 37% Property neg. neg. Public Private Partnerships 2.9% 2.1% 46% 47% Revenue by region year-end 2012 5% 3% Netherlands 9% United Kingdom Belgium 12% 43% Germany Ireland Worldwide 28% 2012 – 3 Contents 4 Foreword Key figures (in € million, unless otherwise mentioned) 2012 2011 6 Royal BAM Group nv shares Revenue from continuing operations 7,404 7,697 Operating result from continuing operations (293.2) 135.4 10 Report by the Executive Board Result before tax from continuing operations (291.0) 143.5 11 Financial results Net result attributable to shareholders (187.4) 126.0 16 Outlook 18 Strategic agenda 2013-2015 Earnings per share (x €1.–) 20 $POTUSVDUJPOBOENFDIBOJDBMBOEFMFDUSJDBMTFSWJDFT t $POUJOVJOHPQFSBUJPOT (1.06) 0.49 34 $JWJMFOHJOFFSJOH t %JTDPOUJOVFEPQFSBUJPOT 0.27 0.05 50 Property 58 Public-Private Partnerships Dividend per ordinary share (in €1.–) 1 0.10 0.16 62 Acquisitions and disposals Payout (as percentage) - 30 62 $PSQPSBUFHPWFSOBODF Number of issued ordinary shares as at year-end 73 Declaration in accordance with the Dutch Financial (x 1,000) 241,525 232,938 Supervision Act Total number of issued shares as at year-end 73 Decision on Article 10 of the Takeover Directive (x 1,000) 241,525 232,938 76 Risk and risk management $MPTJOHQSJDFPSEJOBSZTIBSFTPO%FDFNCFS 85 $PSQPSBUFTPDJBMSFTQPOTJCJMJUZ (in €1.–) 3.23 3.26 87 Human resources management 90 Worker participation Equity attributable to shareholders 921.9 1,162.4 90 $POTUSVDUJPOJOEVTUSZCBSPNFUFS $BQJUBMCBTF 1,045.4 1,362.4 92 Particulars of the Executive Board members Orderbook 2 11,000 10,400 94 Report by the Supervisory Board to the shareholders Net addition to tangible fixed assets 86.9 57.2 107 Remuneration report Depreciation/amortisation/impairments: 116 Particulars of the Supervisory Board members t 5BOHJCMFBTTFUT 80.8 94.9 t *OUBOHJCMFBTTFUT 158.6 11.1 119 Financial statements 2012 t 0UIFSJNQBJSNFOUT 247.7 - 119 $POUFOUTPGUIFGJOBODJBMTUBUFNFOUT $BTIGMPXCFGPSFEJWJEFOE 299.7 232.0 120 $POTPMJEBUFECBMBODFTIFFUBTBU%FDFNCFS 121 $POTPMJEBUFEJODPNFTUBUFNFOU Average number of employees (fte) 23,188 23,702 122 $POTPMJEBUFETUBUFNFOUPGDPNQSFIFOTJWFJODPNF Number of employees at year-end (fte) 23,734 23,830 123 $POTPMJEBUFETUBUFNFOUPGFRVJUZ 124 $POTPMJEBUFEDBTIGMPXTUBUFNFOU Ratios: 125 Notes to the consolidated financial statements t 3FTVMUGSPNDPOUJOVJOHPQFSBUJPOTCFGPSFUBY 198 $PNQBOZCBMBODFTIFFUBTBU%FDFNCFS as % of revenue 3 1.4 1.9 198 $PNQBOZJODPNFTUBUFNFOU t /FUSFTVMUGPSUIFZFBSBTPGSFWFOVF (2.5) 1.6 199 Notes to the company financial statements t /FUSFTVMUGPSUIFZFBSBTPGBWFSBHFFRVJUZ (18.0) 11.1 208 Other information Capital ratios: 208 Proposed appropriation of profit for 2012 t &RVJUZBUUSJCVUBCMFUPTIBSFIPMEFST 208 Provisions of the Articles of Association concerning as % of total assets 13.8 16.1 profit appropriation t $BQJUBMCBTFBTPGUPUBMBTTFUT 15.7 18.9 209 Anti-takeover measures 211 *OEFQFOEFOUBVEJUPSTSFQPSU 212 Overview of principal subsidiaries and associates 1 Dividend proposal 2012. 213 Organisational structure 2 The order book comprises both signed contracts, as well as verbally agreed upon orders. 214 Offices 3 Before impairments. 215 Executive officers 216 Ten years of key data 218 Key financial dates 4 – 2012 Foreword Royal BAM Group presents its annual report for 2012. *OMJOFXJUIUIFGPSFDBTUNBEFBUUIFUJNFPGUIF half-year report, BAM ended this year with a result from continued activities before tax and impairments of €107.1 million from an operating income of €7.4 billion. ‘BAM is working to position itself as a best-in-class construction company, well placed to take advantage of renewed growth in the European markets.’ 2012 – 5 Last year did not see the economic recovery that is sorely OFFEFECZUIFDPOTUSVDUJPOTFDUPSBOEPUIFSBSFBTPGJOEVTUSZ*O the Netherlands, BAM is an important player on the residential DPOTUSVDUJPONBSLFU*OESBXJOHVQPVSIBMGZFBSSFQPSU XF came to the conclusion that our future property development projects in the Netherlands will be later (in time), fewer (in numbers) and lower (in terms of average sales price) than had previously been expected. At that time, this conclusion required BAM to take impairments totalling €398 million, including a EPXOHSBEJOHPGUIFWBMVFPGUIF(SPVQTMBOEIPMEJOHTCZB FNQMPZFFTXIPBSFMPTJOHUIFJSKPCT PSGPSUIFJSGBNJMJFT*O quarter. order to turn the tide and achieve sustainable growth, we continue to focus on cost awareness, risk management and 5IFTFEPXOXBSEWBMVFBEKVTUNFOUTDBTUBTIBEPXPWFS#".T excellent project implementation. OPUVOGBWPVSBCMFPQFSBUJOHQFSGPSNBODFT*OHFOFSBM PVS operating companies posted results that were in themselves *OUFSNTPGTVTUBJOBCJMJUZ XFIBWFBHBJOCFFOBCMFUPNBLF satisfactory, taking into account the market downturn in the progress. Our ambitions and results are presented briefly in this Netherlands and the difficult conditions in the other European report from page 85 on. More details can be found in our home markets. TFQBSBUFTVTUBJOBCJMJUZSFQPSU XIJDI*XBSNMZSFDPNNFOE BAM is committed to corporate social responsibility across the Our earlier strategic choice to focus on public-private FOUJSF(SPVQ XJUIBQBSUJDVMBSGPDVTPOTBGFUZ $02 reduction QBSUOFSTIJQTQSPWFEUPCFUIFSJHIUPOF#".T111BDUJWJUJFTBSF and waste processing. on the right track, with a good supply of new projects. Our multidisciplinary, life-cycle-costs-oriented and integrated BAM started the financial year 2013 with an order book worth approach successfully sets us apart from the competition. Our €11.0 billion, which represents an increase of €0.6 billion PPP projects are further detailed on page 58, and the compared to year-end 2011. contribution of the various PPP transactions in the year under SFWJFXJTEFUBJMFEJOUIFEJSFDUPSTWBMVBUJPO0OFTVDITVDDFTT This healthy order book is a testament to the trust that customers was the award, in collaboration with our partners, of the N33 QMBDFJOUIF(SPVQ*UQSPWJEFTTPMJEGPVOEBUJPOTPOXIJDIUP highway construction project (the first Dutch infrastructure achieve the strategic priorities set during the year under review for project for which long-term financing is provided by a pension UIFQFSJPE5IFNBJOBTQFDUTPG#".TTUSBUFHZBSF fund). presented in more detail starting on page 18 of this Annual Report. The Group foresees various market developments, but in *O UIF(SPVQPODFBHBJOEFMJWFSFEPVUTUBOEJOHUFDIOJDBM general expects to see only limited improvement in conditions in performances. This report includes photos of many projects of JUT&VSPQFBOIPNFNBSLFUT#".TGPDVTXJMMCFPOPQFSBUJPOBM which BAM is proud and to which BAM employees contributed improvements and targeted growth initiatives in services, their skills and enthusiasm. Fierce competition is forcing the multidisciplinary projects and international niche markets, Group to accept low margins, while customers are increasingly combined with a solid and conservative financial strategy. BAM is demanding that construction companies pre-finance projects. working to position itself as a best-in-class construction company, BAM management maintains that the cash outflow this entails is well placed to take advantage of renewed growth in the European VOBDDFQUBCMF5IF(SPVQTDBTIQPTJUJPOJTUIFSFGPSFBOBSFBPG markets. particular focus Group-wide. Bunnik, the Netherlands, 6 March 2013 During the last year, various divisions and regions were forced to further adjust their workforce levels to reflect contracting N.J. de Vries, markets. The fact that this process is necessary and is being $IBJSNBO&YFDVUJWF#PBSE conducted with all due care makes it no less painful for the BAM Royal BAM Group nv 6 – 2012 Royal BAM Group nv shares Stock exchange listing > Graph 2 shows the development of the average number of ordinary shares traded in 2012 on NYSE Euronext Amsterdam. The shares of Royal BAM Group nv have been listed on the NYSE > Graph 3 (page 8) shows the development of the average price Euronext Amsterdam stock exchange since 1959. BAM is listed on on NYSE Euronext Amsterdam in 2012. UIF".9JOEFY .JELBQ BTXFMMUIF&VSPOFYU/&95*OEFY Royal BAM Group ordinary share options have been traded by *GOFDFTTBSZ */(BOE3BCPCBOLBDUBTMJRVJEJUZQSPWJEFSTGPSUIF NYSE Liffe, the NYSE Euronext derivatives exchange, since 2006. trade in ordinary shares. The total stock exchange value (market capitalisation) of the Movements in the number of outstanding shares Group stood at approximately €0.8 billion at year-end 2012 (year-end 2011: approximately €0.8 billion). *O UIFOVNCFSPGPVUTUBOEJOHPSEJOBSZTIBSFTJODSFBTFECZ 8,587,345 to 241,524,914, attributable to the payment of stock Share price dividend. The 2012 closing price for the ordinary share was €3.23, which was The movements in the number of outstanding shares in 2012 is approximately 1 per cent lower than the closing price for 2011 shown in > table 1. The average number of ordinary shares in 2012 (€3.26), meaning the share price lagged behind the AMX index was 238,193,212 (2011: 232,377,783). BQFSDFOUJODSFBTF #".TTIBSFQSJDFIBTGBMMFOCZBMNPTU 75 per cent over the last five years. By way of comparison, the AEX According to the AFM register of substantial shareholdings, five and the AMX index fell by 34 per cent and 19 per cent in the same institutional investors have real interests of 5 per cent or more.