18 Beaver Dredgers and Delta Workboats for Nigeria.
DREDGER/SPECIALISED SHIPBUILDING ACTIVITIES During <strong>2002</strong>, the dredgerbuilding activities went in general in accordance with expectations, but due to problems at one of the yards, the specialised shipbuilding activities showed a dramatically bad performance. Measures have been taken to solve the problems. The net result of the combined dredger/ specialised shipbuilding division fell to a loss of € 28.9 million after a one-time € 25 million restructuring charge. New orders decreased by 46% to € 304 million and our backlog decreased by 27% to € 721 million. The market for the building of dredgers and related equipment was steady during the year, especially in the category of small and mid-size orders. Long-term prospects for this market remain positive, with an expected annual average growth equal to the growth of the global seaborne trade, which is generally estimated at twice the world GDP-growth rate. New orders in <strong>2002</strong>, together with the sustained demand for after-sales supply of spare parts and components, have resulted in a satisfactory order intake. This order intake, added to the order book at the start of <strong>2002</strong>, has resulted in a complete utilisation of all units. Based on the order book at the start of 2003, and the positive market forecast for the coming year, complete utilisation of the yards and the other units is also expected for 2003. In dredgerbuilding, the Group remains well positioned to supply two distinctly different client groups. The investments of the Dutch and Belgian contractors are very much focused on achieving cost leadership in their markets or alternatively being able through advanced technology to dredge beyond the presently existing limits, whereas the state-owned dredging corporations in (semi) closed markets also focus on high quality dredging equipment with proven technology. A healthy development of demand is expected, especially from the latter market segment, which contains a number of emerging countries such as China. The market in specialised shipbuilding was very weak, resulting in increased competition and a lack of orders necessitating restructuring and downsizing of one of the yards, van der Giessen-de Noord. As earlier reported the Group had to take a one-time provision of € 25 million to cover the downsizing and associated costs. Additionally, management was changed and various technical departments within the division have been merged. Increasing cooperation and subcontracting among the yards will improve cost levels. Dredgerbuilding activities Orders and deliveries On the capital dredging and maintenance market, the 19 sales of standard cutter dredgers were, as in other years, at a high level. In addition to orders for medium-sized trailing suction hopper dredgers from Europe, an order was received from China for a 10000m 3 trailing suction hopper dredger, which will be used for the execution of large infrastructural projects in the country. As expected, Dutch and Belgian contractors invested in small and mid-size hopper dredgers. A 5400m 3 unit was ordered by DEME (Belgium) following the order for a 4750m 3 dredger for Van Oord ACZ and the two 16000m 3 hopper dredgers for Royal Boskalis Westminster (the Netherlands) which were ordered at the very end of 2001. Although there is also a keen interest from the Dutch and Belgian contractors to renew a part of their (heavy duty) cutter dredger fleet, no order for a large self-propelled cutter suction dredger was placed during <strong>2002</strong>. The Group nevertheless believes that there is room for the replacement of another large dredger in this category following the order of our client J. de Nul (Belgium) at the end of 2001 for a 27000kW self-propelled cutter suction dredger. An example of technologically advanced equipment was the recent delivery of the deepwater dredging installation for the hopper dredger ‘Vasco da Gama’ of J. de Nul, enabling dredging of sand at a water depth of 155 metres, after lengthening of the vessel and thereby increasing its capacity to 44000m 3 . Deepwater dredging installation for the 44000m3 (after lengthening) trailing suction hopper dredger ‘Vasco da Gama’ for J. de Nul. For the market of sand and gravel and alluvial mining, two seagoing sand and gravel dredgers were delivered to their owners (5000m 3 and 2800m 3 ). Plans to invest in new large seagoing sand and gravel hopper dredgers which were shelved in view of the slow-down in the economy, are becoming alive again, as increasingly concessions are only being granted in waterdepths where existing capacity is less suitable or cannot be used. For the mineral sand and mining market, two dredgers were delivered to their owners in Saudi Arabia and Brazil.