ANNUAL REPORT 2020 — BOSKALIS ANNUAL ANNUAL REPORT 2020 REPORT 2020 KEY FIGURES (in EUR million, unless stated otherwise) 2020 2019 Revenue 2,525 2,645 Order book 5,306 4,722 EBITDA 404 376 Net result from joint ventures and associates 19* 26 Depreciation and amortization 264 265 Operating result 140 28 Exceptional items (charges/income) -195 82 EBIT -56 111 Net operating profit 90 -1 Net profit (loss) -97 75 Net group profit (loss) -97 75 Cash flow 355* 340 Shareholders’ equity 2,283 2,491 RATIOS (IN PERCENTAGES) EBIT as % of revenue 5.5* 4.2 Return on capital employed 3.9* 2.9 Return on equity 3.8* 3.0 Solvency 50.5 54.3 FIGURES PER SHARE (IN EUR) Profit 0.69* 0.56 Dividend (proposal) 0.50 - Cash flow 2.48* 2.55 KEY FIGURES NON-FINANCIAL INDICATORS Employees including associated companies 9,913 9,604 Employees in Boskalis majority owned entities 6,137 5,812 Ratio women/men within Boskalis’ majority owned entities 14/86 14/86 Number of nationalities within Boskalis’ majority owned entities 84 79 Lost Time Injuries (LTI) 9 6 Lost Time Injury Frequency (LTIF) 0.05 0.03 Total Recordable Injury Rate (TRIR) 0.32 0.37 Strategic suppliers: percentage spend covered by Supplier Code of Conduct 85 81 CO2 emissions scope 1+2 (MT (‘000)) 973 1,110 Please refer to the glossary for definitions of the terms used * Excluding exceptional charges ANNUAL REPORT 2020 – BOSKALIS ANNUAL REPORT 2020 REVENUE (in EUR million) NET OPERATING PROFIT (in EUR million) CAPITAL EXPENDITURE (in EUR million) 2,645 2,525 20 9 90 228 232 -1 2019 2020 2019 2020 2019 2020 Net capital expenditure Disposals REVENUE BY SEGMENT (in EUR million) REVENUE BY GEOGRAPHICAL AREA (in EUR million) 175 252 Dredging & Inland Infra 97 581 The Netherlands Offshore Energy Rest of Europe Towage & Salvage 244 Australia / Asia Eliminations (-30) Middle East Africa 1,065 1,316 North and South 457 America 893 ORDER BOOK (in EUR million) ACQUIRED ORDERS (in EUR million) FLEET UTILIZATION (in weeks per year) 5,306 4,722 3,405 3,041 34 35 35 32 26 17 2019 2020 2019 2020 2019 2020 Hoppers Cutters HTVs 1 ANNUAL REPORT 2020 The Annual Report 2020 has been filed in accordance with the European Single Electronic Format (ESEF). The original approved annual report pursuant to article 361 of Book 2 of the Dutch Civil Code, including the audited financial statements and the auditor’s report, is available as a single report package on boskalis.com in the financial information section of the download center. This document is a ‘printed version’ of that digital report and in the event of any discrepancies, the digital single report package will prevail. This annual report contains forward-looking statements. These statements are based on current expectations, estimates and projections of Boskalis’ management and information currently available to the company. These forecasts are not certain and contain elements of risk that are difficult to predict and therefore Boskalis does not guarantee that its expectations will be realized. Boskalis is under no obligation to update the statements contained in this annual report. Some of the projects referred to in this report were carried out in cooperation with other companies. Certain photos in this annual report were taken before the outbreak of COVID-19 or on vessels or at locations where the 1.5-meter social distancing rule and other public health measures do not apply. 2 TABLE OF CONTENTS The upgraded Houtrib dike between Enkhuizen and Lelystad in the Netherlands with the new Trintelzand nature reserve 3 4 CHAIRMAN’S STATEMENT 6 BOSKALIS AT A GLANCE 24 REPORT OF THE SUPERVISORY BOARD 36 REPORT OF THE BOARD OF MANAGEMENT 77 FINANCIAL STATEMENTS 2020 154 OTHER INFORMATION 4 CHAIRMAN’S STATEMENT The year 2020 has been exceptional in many ways. At the particular from everyone on the projects and the vessels. Longer beginning of March we presented our new Corporate Business Plan periods on board and on the projects, longer travelling times and for 2020-2022, which was based on a gradual market recovery tough quarantine restrictions. The demands on the colleagues in the and an upward trend. We were also positive about the longer term offices were also hard, with most colleagues working from home. as we expect Boskalis to make a relevant contribution to solutions for the challenges of the future; in the fields of infrastructure, the energy Looking at where we stand today, and looking back at 2020, I can transition and the protection of coastal regions from climate change. genuinely confess that I am proud of how we have weathered the corona-storm. In part thanks to the measures taken we have ended the Our positive mindset was however bluntly crushed by the coronavirus year with a revenue of EUR 2.5 billion, EBITDA of EUR 404 million mid-March. In one strike, our view of the world was turned upside and a historically high order book of EUR 5.3 billion. At the same down. Lockdown measures were announced across the globe, time, we were able to substantially improve our strong financial working from home became the norm, the aviation industry came to position boasting a net cash of EUR 439 million as per year end. a grinding halt and, as a consequence, keeping our projects and vessels around the world operational and staffed became an DREDGING & INLAND INFRA unprecedented challenge. In the Dredging & Inland Infra division the Duqm mega project was We immediately established a crisis agenda that has been guiding completed last year. A long quay wall and two long jetties were our policy since. The health and safety of our people was constructed in a temporary polder and a huge port area has been paramount, the projects had to continue as much as possible, costs reclaimed alongside. In Saudi Arabia we also completed two major had to be reduced where possible, investments were postponed and dredging projects. In Singapore, the large Finger Pier 3 project is in the order book had to stay filled. To do that, we had to ask a lot full swing and we have been working on the third and final season ANNUAL REPORT 2020 – BOSKALIS from our colleagues in terms of flexibility and loyalty. And in in Kitimat, Canada, where an LNG export terminal is being built. 5 In November, the German federal court ruled in favor of the SALVAGE construction of the Fehmarnbelt tunnel. Last year we already started Salvage has had one of the busiest and most successful years in its on the Danish side and this year we can also get to work on the rich history. Notable projects include the salvage of the bulk carrier German side. Thanks to a positive ruling from the Dutch Council of Stellar Banner that ran aground and the emergency response State, the implementation of the project plan for the upgrading of activities for the Japanese bulk carrier Wakashio, which had run the Markermeer dikes has now been given the definitive go-ahead aground on a coral reef offshore Mauritius. The heavy seas tore the and we completed the upgrade of the Houtrib dike. In the ship apart and it started leaking oil. By removing the bunker fuel, Netherlands we were also successful with numerous tenders, our Salvage colleagues were able to prevent a major environmental including two major dike reinforcement projects. disaster. Furthermore, the VLCC New Diamond that was carrying two million barrels of crude oil was salvaged. This vessel ran into In the closing days of this challenging year we were rewarded with difficulties near Sri Lanka after an explosion and fire in the engine a Letter of Confirmation relating to the land development for the room. After successfully extinguishing the fire, our BOKA Expedition new international airport of Manila. At EUR 1.5 billion, this is the towed the crude carrier to the United Arab Emirates, where the largest dredging project ever undertaken by Boskalis on its own. crude oil cargo was safely transferred to other vessels. With this project, we have secured the utilization of our large hoppers for three years. This was followed in early January 2021 All in all, it has been a fantastic year for Salvage with a historically by the award of a major sub-project of the Oosterweel link high result. It was also a year in which our main competitor Ardent infrastructure project in Antwerp, Belgium. left the market, allowing us to strengthen our position in the Americas. OFFSHORE ENERGY TRANSFORMATION After a couple of tough years, Offshore Energy recovered well last Obviously, COVID-19 has caused a lot of disruptions over the past year. Seabed Intervention in particular made a good contribution in year. In July, we were due to celebrate the tenth anniversary of our this respect with both the successful completion of projects and successful NINA safety program. Since NINA was introduced, our numerous new developments. Work started in El Salvador, where accident rate has dropped spectacularly. Our Lost Time Injury we will connect an offshore Floating Storage and Regasification Frequency fell by no less than 95%! NINA, which was developed Unit to an onshore power plant and a new contract was won for the entirely in-house, has brought about a genuine transformation of the seabed preparation of the Fécamp wind farm offshore Normandy, culture and mentality throughout the company and working without France. In the area of renewables, Subsea Cables also had a very NINA is unimaginable. busy year, with cable-laying projects including Borssele Alpha and Beta, Hornsea 2, Triton Knoll and Ostwind 2 - the largest cable Throughout the year we also made major steps in executing our project in our history.