Servizi
Brunel International NV: "Mixed fourth quarter in Europe; restructuring and transforming Energy"
Amsterdam, 24 February 2017
-27% at constant currencies
-27% at constant currencies
-9% at constant currencies
-7% at constant currencies
Revenue development in Q4 in Europe appears flat year on year. However, this is composed of growth in Germany and other Europe, offset by a decrease in The Netherlands. Energy managed to achieve a slight increase compared to Q3 due to some short term projects, but still a strong decline compared to last year.
As a result of the change in business mix with higher margins in Europe compared to Energy, the gross margin improved by 1.8ppt to 21.9%.
Operating costs are impacted significantly in Q4 by one off restructuring and redundancy cost. Adjusted for these costs operating costs are at the same level as last year. The decrease in Energy is offset by an increase in Europe.
EBIT in Europe dropped compared to a very strong Q4 in 2015, and also the decrease in Energy was significant. Overall EBIT decreased by 88% to EUR 2 million in the fourth quarter.
-44% at constant currencies
-44% at constant currencies
-6% at constant currencies
-23% at constant currencies
Revenue increased slightly compared to Q3 due to some short term projects. Year on year revenue for Q4 reduced by 42% and the decrease was felt in all regions. Australasia and Thailand were impacted mostly as a result of finished work for offshore projects. The impact of Fx differences is limited when comparing Q4 2015 to Q4 2016.
The gross margin appears to remain stable compared to last year. However, this is impacted by a change in the mix. On average the decrease in headcount has been less in areas with an average higher margin. The industry is still facing margin pressure.
In Q4, we have been able to finalize most of our restructuring and cost saving initiatives. This has caused EUR 3.5 million of one off expenses. We have closed or paused some of our activities in Africa and Asia.
Adjusted for the one off costs operating costs in Q4 were reduced by 26% compared to Q4 2015.
EBIT dropped to EUR -3 million due to lower revenue and the restructuring costs.
Brunel Europe consists of Brunel Germany, Brunel Netherlands, Brunel Belgium, Brunel Czech Republic, Brunel Switzerland and Brunel Austria
Germany's revenue has increased compared to the same period last year, despite three less working days in Q4. Revenue per working day increased by 11%.
The decrease in gross margin of 1ppt compared to the same quarter last year is caused by three less working days, largely offset by a higher productivity.
During the fourth quarter operating costs have increased compared to 2015. This is mainly a result of increased staff costs.
EBIT for the quarter decreased by 15% to EUR 5.5 million, mainly due to the impact of the working days and increased overhead expenses.
Revenue for The Netherlands was still impacted by the drop in headcount earlier this year due to the new law DBA, but also less growth in the second half of the year compared to last year and one less working day in Q4. Revenue per working day decreased by 13%.
The downward trend of the gross margin due to price pressure and lower productivity continued in Q4. This quarter also had one less working day. The lower productivity is the result of continued training initiatives and pro active hiring.
Operating costs are slightly higher than 2015 as a result of investments in our sales force and recruitment initiatives.
Lower revenue at lower margins resulted in a decrease in EBIT of 61%.
In 2016 the effective tax rate increased from 33.6% to 56.2%, mainly as a result of an impairment of deferred tax assets of EUR 3.7 million. Due to the lower EBIT level, this impairment has a significant impact on our effective tax rate for 2016.
The December 2016 cash balance amounted to EUR 149 million. Working capital as at 31 December is slightly higher than anticipated due to some short term projects in Energy towards the end of the year.
We propose a dividend of EUR 0.40 per share.
For The Netherlands we expect that the headcount growth we have resumed from July 2016 onwards will continue. This will result in revenue growth, despite the fact that we have started 2017 at a lower level than 2016. In Germany a new law will come in to effect in 2017. We expect that we have taken the appropriate measures and expect to see the growth continuing in 2017. Profitability in Germany will be impacted in 2017 by three less working days. For Energy we will see the full year impact of the decline in revenue in 2016, in combination with a further decline in headcount especially in the first half of 2017. As a result of our efforts towards new activities we expect that the revenue will be stabilizing in the second half of 2017 and we could even be returning to growth.
Jan Arie van Barneveld, CEO of Brunel International N.V.: "
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