DHV returns to profitability

• Profitability increase in first half year due to cost savings
• High-profile projects won
• Leadership in innovation and sustainability confirmed

DHV Group, the international engineering consultancy, improved its financial results over the first six months of 2011. Operating profit (EBITA) increased by 51% upon a revenue growth of 5% to 241 million euro.

DHV home markets present a varied picture. In the Netherlands, DHV performed well despite the current market conditions due to cost savings and enhanced productivity. The public sector market remains difficult and there is price pressure. Operations in Africa and North America performed satisfactorily, while results in Asia lagged behind. Subsidiaries NACO and InterVISTAS, both active in the international aviation market, did well.

Despite the difficult market conditions and economic uncertainty, DHV achieved an improvement in margin. The year 2011 has thus far been one of recovery. DHV focuses on innovative and sustainable solutions, particularly in the markets of transportation, water and environment.

Key figures for first six months

*including one off gains and losses   

Developments in home markets
The market in the Netherlands is showing little sign of recovery; however, the restructuring that was initiated last year had its intended effect on cost and productivity. In addition, the company is responding well to the increased demand for innovative solutions. The market sectors spatial planning and building are under pressure; infrastructure, water and environment are stable.

DHV is executing several large infrastructure projects in Poland as part of the run-up to the 2012 European Football Championship. Hydroprojekt is doing well with its strong involvement in the Polish national flood protection program. In Portugal, DHV expects to benefit from the planned privatization of public-sector services, as government investments decline with the economic and financial crises.

In South Africa, Group company SSI is benefiting from government investments in the upgrading of the country’s road and rail infrastructure, as well as the many water and environmental projects. Mining engineering consultancy Turgis is seeing increased activity in its market. The order portfolio of DHV in Mozambique is solid and growing substantially, mainly as a result of private-sector investments.

China remains a challenging market. There are opportunities in the aviation sector, projects for multinational companies, and the roll-out of the Nereda® water treatment technology. The focus in India and Indonesia is shifting to the private sector. DHV has further strengthened its position in the Vietnamese water sector.

External factors such as the economic unrest in Europe, social turmoil in the Middle East, and high oil prices are having their impact on the aviation sector as a whole. Nevertheless, DHV’s Aviation business is posting good figures.

In the United States and Canada, transportation projects are generating significant work for Delcan, in which DHV has participating interest.

Innovation and sustainability
DHV’s strategy and policy are focussed on innovation and sustainability. The Group actively invests in cooperation with private initiatives, public parties and knowledge institutes. In this way, DHV activities strengthen economic top sectors. Areas of focus include water, agro-food, logistics and energy.

• Business Group Aviation places a strong emphasis on ‘green’ airports. This contributed to the selection of NACO’s master plan as winner of the international design competition for the world’s largest airport, to be located south of Beijing. It will serve 130 million passenger movements per year. 
• The construction of the Nereda® wastewater treatment plant in Epe, The Netherlands, for the District Water Board Veluwe, is nearly complete. This technology saves cost, and requires significantly less energy, chemicals and space than existing technologies. Once in operation, the Epe plant will be the first large-scale Nereda® installation dedicated to domestic wastewater. DHV Group is now rolling out this technology internationally.
• Rijkswaterstaat, the executing arm of the Dutch Ministry of Infrastructure and Environment, has engaged DHV to execute several planning studies for dry and wet infrastructure projects, such as the Zuidas in the financial heart of Amsterdam and the IJmuiden sea lock.
• SSI led the team for South Africa’s largest salt water desalination plant. Located in an environmentally sensitive area, this public-private partnership between Mossel Bay Municipality and industrial client PetroSA serves their mutual need for dependable water supply.
• DHV is participating in the Water Arabian Dutch Initiative (WADI) to help optimize water management, including flood prevention and water treatment, in the Saudi Arabian city of Hafar Al-Batin. The WADI consortium, consisting of DHV, Deltares, Alterra, Norit, Fugro and Bosch Slabber, is notable for the manner in which each partner complements expertise of the others. 
• DHV India has been awarded the contract for stimulating sustainable development of Bhopal in the State of Madhya Pradesh in India. The assignment, using principles of social, economic, environmental and cultural sustainability, entails the development of projects on a PPP basis.
• Looking to its own operation, the sustainable renovation of DHV’s head office has been completed. The building’s energy label rating has been upgraded from G to A, with CO2 emissions reduced by 41 percent.

Outlook
DHV expects continuing economic instability in the regions where the company is active, and has geared the organization accordingly. In the short term, the company aims to continue improving its profitability by increasing market share through innovation and further cost savings and to improve its cash flow. In the longer term, growth will once again increase in importance.