Fokker Technologies Today Publishes its Annual Results for the Year 2014

March 30, 2015

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Strong operational performance with stable revenue

FINANCIAL HIGHLIGHTS

                                                         2014                                       2013

Revenue                                          €758m                                    €762m                       

Operational EBIT                            €53m                                     €47m             

Result before tax                            €4m                                        €11m             

Net result                                         €4m                                        €11m

Operational Cash flow                   €45m                                     €26m

 

• 2014 revenue was stable and amounted to €758 million (2013: €762 million)
• Operational EBIT for the Group increased to €53 million (2013: €47 million)
• Net profit at €4 million (2013: €11million) significantly impacted by provision for US Settlement and the restructuring at Fokker Services (together €21 million)
• The Operational Cash Flow strongly improved to €45 million (2013: €26 million)
• The Design & Build business units showed strong operational performance and robust margins:
  • Operational EBIT up by 11% to €56 million (2013: €50 million)
  • Operational EBIT margin increased to 9,9% (8,8% in 2013)
  • Order book has been reinforced and is in excess of €7 billion for the next 10 years
• The Services business unit showed recovery after restructuring and downsizing the organization with 150 FTE: 
  • Revenue related to non-Fokker Aircraft now 48% of total revenue as Fokker fleet revenue related continues to decline
  • Operational EBIT doubled to €8 million (2013: €4 million)
  • Operational EBIT margin doubled to 4,2% (2% in 2013)

 

Hans Büthker CEO, commented:

“Strategically, operationally and financially Fokker Technologies made sound progress in 2014. The implemented strategy for the Design & Build Business unit looks to have strong resonance with our customers, with them increasingly recognising Fokker as a tier 1 specialist and a technology leader. Furthermore the unit achieved better than expected operational and financial results, capitalising on a good mix of programs, and strong operational improvements, in a stable market environment. In the Services unit, the successful restructuring and increased revenue from non- Fokker customers allowed operational EBIT to double. This solid operational and financial performance, coupled with our order book in excess of €7billion, shows we are well positioned for the future.”

Revenue

• Revenue for the Design & Build business units was stable compared to 2013 – at a level of €561 million, the Service business showed a slight decrease in the turnover of 2% to €200 million.

• Revenue in the commercial market was stable with revenue related to business jets showing a slight increase of 1%.
• Revenue in the defense sector increased, in particular on the F-35 program and the NH90 helicopter program.
• Total revenue in Services decreased with 2% as a result of the anticipated decline in the Fokker fleet. The considerable growth in revenue related to non-Fokker aircraft compensated for a large part the loss of the Fokker revenue.

 

Operational EBIT

• In 2014 Fokker focused on improving the gross margins of its programs which has been achieved by costs reductions and improved processes. As a result the Design & Build business units increased their operational EBIT with €6 million to €56 million and Operational EBIT margin continued to increase from 8.8% to 9.9%.
• The operational EBIT of the Services business unit improved to €8.5 million from €4.1 million resulting in an operational EBIT margin of 4.2% (2013 2.0%). This was due to the restructuring measures as well as increased non-Fokker related revenue.
• Operational EBIT for the Group, taking into account certain group costs, amounted to €53 million and was € 6 million higher than in 2013. Excluding exceptionals and amortization of Purchase Price Allocation assets the Operational EBIT margin of the Group increased from 6.2% in 2013 to 7.0% in 2014.

 

Fokker Services US settlement: provision of €15.4 million

A provision for the US settlement affected the Group’s net result considerably. As previously communicated the Federal District Court for the District of Columbia has declined to approve the agreement with Department of Justice (DOJ). Both Fokker Services and DOJ have filed a notice of appeal.

 

Outlook

After three years of flat growth but with substantial investments in non-recurring programs, Fokker is now preparing for a considerable ramp-up in some of its aircraft programs over the coming years.

This will become achievable following the migration of the order book from the development phase to the full production phase for the Airbus A350XWB, the Lockheed Martin F-35, the Dassault F5X programs and the Bombardier CSeries. These are multi-year contracts that will result in a step up in revenue in the next years. In the meantime the Design and Build business units remain focused on strengthening its market position in aerostructures, electrical systems, and landing gear.

 

Fokker Services will continue its transformation to an innovative aerospace services provider with increased emphasis on non-Fokker aircraft.

The mid-term outlook target is to achieve a Group operational EBIT margin of 10%.

Source : Fokker Technologies