1 Strukton Annual Report annual report 2011

Transcription

1 1 Strukton Annual Report 2011 annual report 2011

2 Annual Report 2011 This Annual Report is issued in digital form only. The PDF can be downloaded from and is also available in Dutch. Strukton also publishes an Annual Review in printed format, giving the key developments in The Annual Review can be viewed or ordered online. Strukton Groep nv Westkanaaldijk 2, Utrecht PO Box 1025, 3600 BA Maarssen The Netherlands Telephone +31 (0) Website Registered in the Trade Register of the Chamber of Commerce in Utrecht under number Strukton Annual Report 2011

3 Contents Report by the Group Management Board 4 Profile 7 Composition of the Group Management Board and Group Management Committee 9 Key figures 10 Strukton s specialist areas 11 Financial results 13 Corporate social responsibility 17 Strukton Rail 23 Strukton Civiel 30 Strukton Bouw 34 Strukton Worksphere 38 Strukton Integrale Projecten 42 Corporate governance 46 Risk management 49 Financial statements 54 Auditor s Report 118 Names and addresses 120 Glossary 126 Acknowledgements Strukton Annual Report 2011

4 Report by the Group Management Board Strukton achieved a positive operational result in This is a good performance, given that markets are still difficult. The various business units are now collaborating to an extensive degree, and as a result Strukton can carry out integrated projects in their entirety. Measures were required at a number of points in the organisation in order to adjust costs in line with market conditions. Unfortunately, this involved the loss of around one hundred and fifty jobs. The order book is well filled, with orders totalling EUR 2.0 billion. Result As in 2010, Strukton achieved a good result. Unfortunately there were two anomalies, one involving a branch office outside the Netherlands and the other an infrastructure project, that have had a negative effect on the results. We are seeking to improve control and prevent such unexpected losses in future by having more design checks and audits during project execution as well as by monitoring operations more closely. Revenue fell slightly compared with 2010, partly due to two large projects that were still in the preliminary phase in 2011 and not yet in full production. These were the Groene Loper (Green Carpet) for the A2 motorway in Maastricht and the A15 Maasvlakte-Vaanplein motorway section near Rotterdam, both Strukton Civiel projects. There was also a slight decrease in the revenue from Strukton Rail s domestic and foreign operations. Acquisitions and disposals Two significant sales took place in The first was the sale of an industrial site of 36,000 m 2 including buildings in Utrecht as well as a number of operations run by the plant business, Strukton Materieel. These operations mainly concern the hire and management of plant and tools. Strukton decided on this partial disposal as there is no strategic need to have its own internal department for construction equipment. A preferred supplier contract for plant hire has been concluded with the buyer. The second sale was of 80% of the stake in six PPP projects to DIF Infrastructure II. Besides its 20% minority interest, Strukton will remain very actively involved operationally during the construction and commercial operation phases of these projects. This sale is strategically important for Strukton because it lets the company release capital that will allow it to continue to play a leading role in future PPP projects as a provider of equity. Strukton also continues to use its know-how and experience with DBFM(O) to find the best possible solution for its clients. 4 Strukton Annual Report 2011

5 Report by the Group Management Board Both these sales had a positive impact on the balance sheet and led to a substantial reduction in Strukton s indebtedness. Strukton s solvency has increased as a result and is now more in line with that of the shareholder, Oranjewoud nv. The low interest rates in the market enabled healthy returns to be achieved and a reduction in the balance-sheet total. The disposals have not had a negative impact on the company s commercial operation; this is secured. Preparations for the acquisition of road construction company Ooms Nederland Holding bv took place in This acquisition was completed at the start of The acquired operations were the groundwork, road building and hydraulic engineering operations, the Dutch consultancy operations (Unihorn) and part of the non-dutch infrastructure operations within Ooms International Holding Company. They form a separate business within Strukton Civiel under the name Ooms Civiel. The acquisition fits in with Strukton s strategy of focusing on broadening and deepening its activities in the supply chain. This acquisition bolsters Strukton s infrastructure operations and its position in this market by giving it nationwide coverage: Ooms Civiel serves the west of the Netherlands while Reef Infra, acquired in 2006, mainly operates in the east of the Netherlands. Operating companies and integral solutions Strukton took significant steps in 2010 to restore profitability and continued on this course, with success, in Strukton Rail performed well, particularly in the Netherlands and Sweden, and Strukton Systems also achieved very strong results once again. The loss-making operations in Norway have been discontinued. Strukton Rail s order book is well-filled. Strukton Civiel has successfully completed one part of the work on the Noord/Zuidlijn underground and has a well-filled order book. Strukton Bouw has completed a large number of projects. It has refined its strategy with a view to increasing its success in bidding for tenders. Strukton Worksphere made considerable progress in 2011 and put substantial effort in improving its organisation. This operating company holds a unique position in relation to its competitors and this offers many opportunities for Strukton Integrale Projecten has successfully and professionally managed the sale of an 80% stake in the PPP projects. There is increasing demand in the market for companies that are able to take on work using an integrated approach, dealing with the design, construction, maintenance and operation. Most of the projects on Strukton s books are large, complex projects in which different business units work together. Strukton is capable of offering the integrated approach clients demand and the company made major progress again in 2011 in developing collaboration within the supply chain. 5 Strukton Annual Report 2011

6 Report by the Group Management Board Strategy Strukton s strategic focus remains the Netherlands, as well as other countries in specific instances certain business units and niches. Within this framework, Strukton operates in three markets: rail infrastructure, civil infrastructure and the construction, maintenance and management of buildings. The company is seeking to concentrate on specialist areas within these markets in order to create a distinctive profile. For instance, Strukton Rail will increasingly be operating on the international stage, concentrating not just on track maintenance but also on the electronics in the trains themselves. Strukton Systems is currently exploring the wind turbine market, where it has two projects. The acquisition of Ooms Civiel has improved Strukton Civiel s position. Strukton Civiel will be focusing more on traffic management systems and technical systems for tunnels in collaboration with Strukton Worksphere. There are also opportunities in hydraulic engineering. Strukton Bouw and Strukton Worksphere will be targeting a limited number of segments, namely healthcare, hotels, accommodation for students and young people, data centres, temporary housing and the conversion of office buildings for other purposes. In 2012 Strukton will not only be focusing on the three markets mentioned above, it will also be concentrating on a number of other strategic priorities. There will be more emphasis on the consolidation of client relationships. Furthermore, Strukton will focus more on actively approaching clients and explicitly promoting its range of services. The company also aims to develop more products into fully-fledged concepts, which it then markets. Outlook The strategic and commercial decisions that were made in 2011 mean that Strukton can face 2012 with confidence. It has been said often enough: market conditions are difficult. That is an unavoidable fact. It therefore makes more sense to concentrate on what we are able to influence ourselves. As an example, we will be focusing more on having our projects under control so that we can further reduce the costs of failure. Strukton has demonstrated that it is a professional organisation. The fact that the company marked its ninetieth year in 2011 shows that Strukton has earned its position. What is more, Strukton was among the top three in the reputation monitor for the third consecutive year. The organisation is well placed for the future as it has made the right choices at the right times. Board member Raymond Steenvoorden left Strukton in December 2011 after serving the company for nearly ten years. He has had a big hand in creating the company we have today through his inspiring personality and professional approach, and I would like to thank him very much for all he has done. I am also very grateful to our staff. They show incredible drive and dedication in their efforts to please clients and complete projects successfully. I have every confidence that together we will make 2012 a successful year. Utrecht, 8 May 2012 Gerard Sanderink Chairman of the Board 6 Strukton Annual Report 2011

7 Profile Strukton is a full service provider for infrastructure and accommodation solutions. Our goal is to enable end users to live, work, travel, learn and relax in comfort. Strukton operates in three markets that are subdivided into four segments: Rail infrastructure market: rail infrastructure and information systems (Strukton Rail) Civil infrastructure market: civil infrastructure (Strukton Civiel) Buildings: construction and property development (Strukton Bouw) and technical management and services (Strukton Worksphere) Strukton Integrale Projecten operates in each of these markets as well as in multi-market projects. It focuses on PPP concession projects, new concepts and in-house initiatives. Philosophy Strukton s starting point is the functionality and lifespan of buildings and civil engineering infrastructure. That is why the company chooses integrated contract forms that create opportunities for quality, comfort and sustainability. Two examples of such integrated contract forms are Design and Build (DB), and Design, Build, Finance, Maintain and Operate (DBFMO). Strategy Strukton s strength lies in realising complex projects in complex environments. Its aim is to provide even greater added value, which will enable it to develop a distinct identity and position in the market. Clients need to realise that they can rely on Strukton, that they will get value for money and that they can expect trend setting solutions. Strukton focuses on mobility, transport hubs and uninterrupted operation. The collaboration between the various Strukton businesses means Strukton is able to carry out integrated projects in their entirety. The core strategic themes are: the mindset of the company s employees, as that is what determines Strukton s distinctive capabilities the expansion of the construction chain in both length and breadth the further development of market niches 7 Strukton Annual Report 2011

8 Profile Mindset Strukton staff not only have a good grounding in their disciplines, they also take the initiative to come up with innovative solutions. They consider problems from the client s perspective and then suggest new, sustainable concepts and solutions. CSR policy Strukton conducts its business in a socially responsible manner, leading the way in the sector. Strukton thinks in terms of lifespan; it can achieve a great deal for clients, for instance by making buildings more sustainable and by providing employment opportunities locally (social returns). Staff are also encouraged always to weigh up explicitly what is best for people, the environment and the business. In 2011, Strukton had an average of 5,906 employees and revenue of EUR 1.3 billion. For more information on: Strukton and the operating companies: The financial situation and the financial statements: report Risk management and corporate governance: (see Finance and Governance ) Strukton s CSR policy: Strukton as an employer: Revenue in 2011 Rail infrastructure and information systems Civil infrastructure Construction and property development Technical management and services 19.1 % 13.7 % 44.5 % 22.7 % 8 Strukton Annual Report 2011

9 Composition of the Group Management Board Chairman of the Group Management Board Gerard Sanderink Chairman of the Board Nationality Dutch Joined Strukton October 2010 External positions Managing Director of Oranjewoud nv Director/owner Centric Group Management Committee Jos Hegeman Erik Hermsen Marinus Schimmel Aike Schoots Gert Jan Vos Strukton Civiel Strukton Integrale Projecten Strukton Worksphere Strukton Rail Strukton Bouw From left to right: Marinus Schimmel, Aike Schoots, Gerard Sanderink, Jos Hegeman and Gert Jan Vos. Not in the photo: Erik Hermsen 9 Strukton Annual Report 2011

10 Key figures (amounts in millions of euros) Revenue 1, , , , ,144.8 Operational result (EBITDA) Operating result (EBIT) 24.1 (6.4) Profit for the period 14.4 (15.5) Cash flow Operational > Regular (10.6) > PPP projects (29.1) (76.3) (70.5) (30.5) (0.3) Investments 13.0 (5.8) (25.6) (26.0) (39.8) Financing > Regular (9.2) (9.4) (4.3) (20.1) (2.1) > PPP projects (0.5) Translation differences - (0.1) Total cash flow (7.4) (18.8) 16.3 Additions to property, plant and equipment Depreciation/impairment of property, plant and equipment Excluding consolidation of non-recourse PPP projects Balance-sheet total Capital employed Net cash (debt) (52.2) (51.8) (42.5) Solvency (%) Return op capital employed (%) 13.2 (3.6) Order book at year-end 1, , , , ,210.8 Including consolidation of non-recourse PPP projects Balance-sheet total Total equity/group equity Capital employed Net cash (debt) (62.6) (198.9) (174.9) (101.4) (49.7) Solvency (%) Profit for the period as a percentage of average total equity 8.1 (9.1) Profit for the period as a percentage of revenue 1.1 (1.1) Non-financial indicators Average number of employees * 5,906 6,159 6,232 5,962 5,514 Sickness absence (%) Accident frequency (IF index) Average duration of sickness absence Accident figure Frequency figure Expenditure on management development and training Percentage of staff reviewed (%) * The figure for the average number of employees relates to the company as a whole. The other figures only relate to the 4,963 employees in the Netherlands. 10 Strukton Annual Report 2011

11 Strukton s specialist areas Core activities Strukton Rail A European full service provider of rail systems. Operations in infrastructure, maintenance management, rolling stock, machinery and logistics. Strukton Civiel Design, realisation, maintenance and management of infrastructure projects, with specific knowledge of underground construction, road construction, viaducts, stations, noise barriers, techniques for constructing foundations and immersing segments, and the environment. Strukton Bouw Providing customised accommodation for people, companies and business processes. Planning and project development can have an important supporting role in this. Strukton Worksphere Technical management and plant management: providing integrated services in the field of technical installations in buildings and hard services, working from the premise that people who feel comfortable in the areas where they work and stay will perform best. The sustainable and inflation-proof development of existing properties. Strukton Integrale Projecten Innovative and integral solutions based on the overall lifecycle of the infrastructure or the built-up environment. This includes integrated forms of contracts and cooperation, such as DBFM and DBFMO: Design, Build, Finance, Maintain & Operate. Maintenance, renovation and new construction of railways and rail systems for both heavy rail and light rail Information systems (including systems for passengers) Safety systems Data acquisition and data management Development and integration of electrical systems in rolling stock Energy systems Wet and dry infrastructure (in situ, bored and submerged tunnels, bridges, stations, roads and road maintenance, construction and maintenance of dams) Building in complex environments Industrial construction Water management and water treatment Specialist fields: immersion techniques, multi-storey car parks, foundations, noise barriers, roads, renewable energy Prefab concrete Surveying and marine surveys Traffic management Management of assets Building in complex environments Residential and non-residential construction Renovation, rebuilding and (scheduled) maintenance Technical management Property Development Redevelopment Technical service, management and maintenance New construction and renovation of technical installations, including making properties more sustainable through innovative contract forms such as ESCos (Energy Service Companies) Acquisition, design, construction and commercial operation, based on concession performance contracts and the outsourcing of technical services Management of the commercial operation of PPPs: integrated facility management services and property management Main contracting Consultancy and interim management Development and supervision of construction and rebuilding projects and planning the hard service aspects of accommodation, tenancy and rental Acquisition, financing and management of PPP projects Management of risk-bearing PPP investments Further development of PPP, concept development and in-house initiatives 11 Strukton Annual Report 2011

12 Market segments/clients Rail infrastructure managers, primarily in Western Europe Transport companies (municipal, regional, national) Government (local and provincial) Industry Stock suppliers and leasing companies Public highway administrators Rail infrastructure administrators (primarily in the Netherlands) Mainports, airports Major cities and governmental bodies Industrial clients (companies involved in storage, utilities, waste processing and water treatment) Transport companies (municipal, regional, national) Healthcare Hotels Accommodation for students and young people Data centres Temporary housing Conversion of offices for new use Professional and financial service providers Educational institutions Healthcare institutions Sustainable buildings Data centres Multi-storey car parks Traffic systems Entertainment industry Industry Government Transport sector Government (national, provincial, municipalities and water boards) Healthcare and educational institutions Rail infrastructure administrators in Western Europe Market features High barrier to entry (knowledgeintensive and capital-intensive) Focus on safety and quality for a fair price Increasing competition Europe-wide market in which every country is different Niche market Competitive Cyclical Fragmented market with just a few players in the top segment and a lot of local/regional parties Focus on quality and added value Shifting to new forms of contracting and tendering Focus on sustainability Developing and growing High level of complexity and risk of failure Focus on service ethos Focus on value retention Knowledge-intensive Increasing degree of outsourcing Increasing complexity and risk of failure Growing (accommodation for governmental bodies, infrastructure) Developing (education, light rail and healthcare) Quality-driven (sustainable/socially responsible) Room for private initiatives International power relationships Strukton s skills Data acquisition and data management Consulting and engineering Machines and logistics Rolling stock Project management and process management Broad knowledge of technology (in-house engineering and specialist skills) Knowledge of innovative contractual and cooperative forms Specialist in underground construction Realisation of projects while client processes are ongoing Systems engineering Risk management Optimisation of costs versus revenues, with a strong customer focus Integral approach to the construction process, focusing on the property, from the planning and project phases through to commercial operation Lifecycle/total cost of ownership approach Offering operational reliability for processes that support clients core business operations Creating environments in which people can work and stay and excel Approach that takes account of both community interests and the individual interests of the owner and end user Customer focus Central control based on technology Professional methods and resources Knowledge of clients core processes Project management, risk management, contract management and financial management Lifecycle-based approach and longterm responsibility Knowledge of innovative contractual and cooperative forms 12 Strukton Annual Report 2011

13 Financial results Major improvement in net result with a profit of 14.4 million euros (2010: loss of 15.5 million euros) Fall of 8.3% in revenue to 1,318 million euros (2010: 1,438 million euros) Slight fall of 4% in operational result to 55.3 million euros (2010: 57.6 million euros) Impairment losses of 6.4 million euros in goodwill and intangible assets (2010: 35.9 million) Dividend proposal: no dividend payments Substantial increase in solvency to 23.2% (2010: 17.2%). If PPP non-recourse financing is excluded, solvency is 26.6% (2010: 23.1%) Size of order book virtually unchanged at 2.0 billion euros (2010: 2.1 billion euros) Operating performance An operational result of 55.3 million euros was achieved despite a slight fall in revenue and difficult market conditions. All segments made positive contributions to this operational result. The net result improved significantly in 2011 with a profit of 14.4 million euros. Revenue After a period in which revenue increased every year, revenue fell in 2011 by 8.3% to 1,318 million euros. This was mainly due to two large civil engineering projects that were still in the preliminary phase in 2011 and were not yet in full production (the Groene Loper project for the A2 motorway in Maastricht and the A15 Maasvlakte-Vaanplein motorway section near Rotterdam) and to lower levels of production by Strukton Civiel s specialist business units. There was also a slight drop in revenue from Strukton Rail s domestic and foreign operations. The size of the order book fell slightly but is still high at 2.0 billion euros. All four segments have well-filled order books for The proportion of the order book accounted for by long-term PPP projects is 429 million euros. 13 Strukton Annual Report 2011

14 Financial results Revenue in millions of euros Rail infrastructure and information systems Civil infrastructure Construction and property development Technical management and services Total 1, ,437.5 Result A sound operational result (EBITDA) of 55.3 million euros was achieved in All segments made positive contributions to this operational result. There was a one-off transaction gain of 18.6 million euros due to the sale of an 80% stake in Strukton Finance Holding (PPP projects) and the sale of property and assets belonging to Strukton Materieel. This result benefited all four business segments. Even when this result from disposals is excluded, all four business segments made positive contributions to the operational result. Operational result in millions of euros Rail infrastructure and information systems Civil infrastructure Construction and property development Technical management and services Total The development of Strukton Rail s results both in the Netherlands and abroad has been satisfactory with the exception of Norway. This is a good performance given the pressure in the market on prices. The result for the operations in Norway and the termination of these operations had a substantial negative impact on Strukton Rail s results. Strukton Rail achieved a profit of 27.0 million euros, which is 10.2 million euros less than in At Strukton Civiel, a setback in a project led to a setback in the result. Furthermore, margins were lower due to lower capacity utilisation within Strukton Civiel s specialist business units. An operational result of 10.1 million euros, including the one-off transaction result, is a good performance in this difficult market (2010:13.3 million euros). Strukton Bouw recorded a modest positive result if the one-off transaction result is excluded. Positive results were recorded despite a provision being made for a reorganisation and despite markets with considerable pressure on prices. 14 Strukton Annual Report 2011

15 Financial results Strukton Worksphere s results are good. Revenue and profits have remained stable (before taking account of the one-off transaction result) even though there has been a downturn in the market. The overall result shows a significant improvement on 2010 of 5.5 million euros. There were cuts in costs and a limited reduction in staffing levels in all business segments in Operating result in millions of euros Operational result Depreciation of property, plant and equipment (21.0) (22.5) Depreciation of intangible fixed assets (3.8) (5.6) Impairments (6.4) (35.9) Operating result 24.1 (6.4) Impairments totalling 6.4 million euros were recognised in 2011 (2010: 35.9 million euros). This sum was largely for the write-down on goodwill for Strukton Rail s participating interest in Norway. In 2010 and 2011, impairments were recognised in goodwill and intangible assets acquired as part of takeovers in previous years. Financial result There was a further improvement in the financial result in 2011 compared with the previous year. The loss of 5.1 million euros meant that the financial result was 19.1% better than in 2010 (a loss of 6.3 million euros). This improvement was a result of lower financing costs and increased financial income from PPP projects. The tax burden in 2011 was 7.0 million euros (2010:5.5 million euros). That gives an effective tax rate of 32.8%. This relatively high effective tax rate is mainly due to the impairment of goodwill, costs outside the Netherlands that are not tax deductible and the write-off of a deferred tax asset because of the termination of Strukton Rail s operations in Norway. Net result There was a substantial improvement in the net result for 2011, giving a profit of 14.4 million euros as opposed to a loss of 15.5 million euros in Capital expenditure Capital expenditure on property, plant and equipment amounted to 19.7 million euros in 2011 (2010: 16.7 million euros). Most of the capital expenditure was made in the Strukton Rail segment. Strukton seeks to optimise the quality of its capital expenditure, which means such expenditure must contribute to Strukton s core operations. 15 Strukton Annual Report 2011

16 Financial results Cash flow and financing The total net cash flow in 2011 was a negative flow of 7.4 million euros (2010: positive flow of 9.6 million euros). This was mainly due to a fall in the pre-financing for large infrastructure projects and the loss on Strukton Rail s operations in Norway. The cash flows from the sale of the PPP projects and Strukton Materieel s assets are recognised in the investment cash flows. The net cash flow from investment activities was 13.0 million euros (2010: a negative flow of 5.8 million euros). This means the extensive programme of capital expenditure on property, plant and equipment was fully funded by the proceeds from the disposals. There was an early repayment of 15.0 million euros on bank loans in December The net cash flow from financing activities in 2011 was 19.3 million euros (2010: 53.3 million euros). This mainly reflects the loans taken out as part of the non-recourse financing for the PPP projects. Acquisitions and disposals On 6 December 2011, Strukton reduced its share in six PPP projects by selling an 80% stake in Strukton Finance Holding to DIF Infrastructure II. This disposal fits in with the strategy of freeing up capital in order to invest further in Strukton s new activities. Strukton remains operationally responsible for these projects and will continue to invest in PPP projects in future. On 13 October 2011 Strukton sold the land, property, plant and equipment owned by its plant business, Strukton Materieel, to RECO/BUKO. The operations of the plant business are not part of Strukton s core activities and this disposal frees up money for the repayment of debts and investments in core activities. On 5 January 2012 Strukton Civiel acquired a 100% stake in Ooms Nederland Holding bv. This transaction involved Strukton Civiel taking over the infrastructure operations of Ooms Avenhorn Group bv. The details of this transaction will be included in the 2012 financial statements. Capital position Strukton s solvency improved considerably in Solvency in 2011 was 23.2% (2010: 17.2%). If PPP non-recourse financing is excluded, solvency was 26.6% (2010: 23.1%). The sale of an 80% stake in the PPP projects also meant that the non-recourse PPP financing included in the balance sheet fell to 64.2 million euros (2010: million euros). The net cash position of 0.4 million euros at the end of 2010 improved in 2011 to become 16.3 million euros. These improvements in solvency and the net cash position give Strukton a firm basis on which to do sound business. 16 Strukton Annual Report 2011

17 Corporate social responsibility Strukton s basic premise is that people, the environment and clients deserve just as much care and attention as its business operations. The interests of People and Planet are of equal value and complementary to commercial requirements and quality (Profit). Strukton sees fair, honest business practices as the basis for its operations and its contacts with its stakeholders. Still at level 5 on the CO2 performance ladder In 2011 Strukton retained level 5 the highest level on the CO2 performance ladder. This is a unique achievement in the sector because no other company is at level 5 for rail and civil engineering and construction and electrical and mechanical engineering all at once. Strukton was able to maintain this level thanks to various measures. For example, measures were taken to deal with the lease fleet, the biggest source of CO2 emissions. The permissible level of emissions the emissions ceiling for lease vehicles has been made more stringent. Lease vehicles with emissions of 155 g/km (petrol) or 136 g/km (diesel) were still allowed until September 2011 but those limits have now been replaced by a maximum of 140 g/km (petrol) or 116 g/km (diesel) for most of the 17 Strukton Annual Report 2011

18 Corporate social responsibility fleet. Further measures are planned for 2012 relating to mobility budgets and management. The CO2 performance ladder is used not just by ProRail but also by the Dutch Directorate-General for Public Works and Water Management (Rijkswaterstaat). A new version has now been developed: the CO2 performance ladder 2.0. This new version assesses not just the emissions produced by the building companies themselves but also the emissions produced by the projects. One of the first projects to be put out to tender using this performance ladder in 2011 was the Reconstruction of the Kunderberg A76/A79 motorway interchange. Strukton Civiel won this tender because it was expected to keep its level 5 position on the modified ladder. In 2012 Strukton as a whole will meet the requirements for level 5 of the CO2 performance ladder 2.0. The business units that Strukton Civiel purchased from the building company Ooms Civiel had already obtained certification at this level by the end of Ooms Civiel has a number of sustainable innovations in its product range, such as the solar road a bicycle path with solar panels embedded in the asphalt. Sector initiatives aimed at reducing CO2 emissions Strukton is championing CO2 reduction throughout the supply chain. A third of heavy goods vehicles on the motorways are connected to the construction industry. Strukton is collaborating with partners in the concrete and glass supply chains to investigate the options for organising transport more efficiently, for example by combining delivery and collection journeys. Strukton is also examining the options for making the logistics more sustainable and perfecting them together with suppliers in the Den Haag Centraal Public Transport Terminal project. As part of the Green Deal programme, Strukton and a number of fellow contractors and cement and concrete supply companies have started up the Sustainable Concrete Green Deal. The aim of this Green Deal is to make concrete even more sustainable. The initiative was signed by MVO Nederland (the national CSR expertise and network organisation) and the State Secretary for Infrastructure and the Environment, Mr Atsma, during the so-called Maarssen Day, dedicated to innovation, on 4 October Sustainability within Strukton Strukton is continually looking for ways within its own organisation of making business processes even more sustainable. That is why in 2011 Strukton Bouw, Strukton Civiel and Strukton Worksphere jointly appointed two employees who will be working full-time on sustainability. Strukton Rail had already appointed a sustainability officer. 18 Strukton Annual Report 2011

19 Corporate social responsibility In 2011 Strukton Rail and Strukton Civiel joined the B50, fifty high-profile employers in the Netherlands that are setting trends in smart working and travelling and want to encourage such smart practices. This encouragement is evident in the Strukton Shuttle at Strukton, for instance, which started as a pilot project in This taxi service operates a shuttle between Maarssen station and the head office for staff and visitors during off-peak times. A similar service was already available during peak hours. By offering the shuttle service in off-peak hours as well, Strukton is aiming to encourage the use of public transport. The vehicle used for the shuttle service is a Toyota Prius. If the pilot is a success, Strukton will purchase an even more sustainable vehicle. Staff were also made aware of the possibilities of electric transport in Employees were introduced to electric cars and scooters at the Electric Roadshow held during the Sustainability Day. Sustainable projects and working practices The Thinking Green think tank was set up in This team, which has members from all parts of the organisation, acts as an advocate for sustainability projects. Indeed, sustainability features in numerous projects executed by Strukton, whether at the request of clients or on the initiative of Strukton itself. For example in Amsterdam, Strukton Worksphere has started installing two thousand five hundred public recharging outlets for electric vehicles. Energy company Essent in partnership with Strukton are responsible for installing a large proportion of these recharging outlets. Strukton itself is increasingly opting for electrically powered transport in its projects. For instance, Strukton Worksphere uses electric scooters in the municipality of The Hague, the HanzaRailTeam is using an electric car for the Hanseatic Rail Line project and Strukton Rail West has an electric car for business travel. In Rotterdam, Strukton is working on making nine municipal swimming pools more sustainable. The swimming pools will be more energy-efficient, CO2 emissions will be reduced, and water and air quality will be improved. Strukton set up an Energy Service Company (ESCo) for the purpose of this project. The ESCo designs and executes the energy-saving measures, arranges the funding and guarantees the energy savings. This is not only an opportunity for improving sustainability; Strukton also sees it as a good example of a business model that is appropriate for the company s CSR policy. The business unit Afvalbank Nederland (for waste recycling) was set up in 2010 and developed 19 Strukton Annual Report 2011

20 Corporate social responsibility further in The aim is to improve separation of the company s own waste streams at the source and reuse the materials released in the company s own projects. A good example is the Hilton Hotel in Amsterdam, where 87% of the waste has been made fit for reuse. In the DUO project in Groningen, Strukton Civiel is collaborating with Delft University of Technology, MVO Nederland and other partners in the supply chain to see whether it is possible to reuse all of the concrete from the demolished offices of the Education Executive Agency and Regional Tax Office for the construction of the garage car park. This would keep the use of new raw materials to a minimum. The technological developments to allow this were made in 2011 and implementation will take place in Consideration for people and the local area In the Groene Loper project, the Avenue2 school was set up to ensure social returns. A total of 750 unemployed and people with difficulty finding work will receive training through this school during the ten years in which Strukton will be working on the project in Maastricht. These people live in or near Maastricht. After their training has finished, they will be given a temporary employment contract with the Groene Loper, for example in security, traffic control or administration. Strukton is collaborating with the municipality for this. When working on a project, Strukton always tries to keep disruption to the surrounding area to a minimum. That is demonstrated by the Considerate Constructors certificate, which Strukton set up in partnership with BAM, Ballast Nedam and VolkerWessels in Workers at building sites with this certificate ensure safety at the building site as well as the safety of passers-by. They also ensure that noise disturbance is kept to a minimum and they are environmentally aware. As of 2011, all Strukton Civiel s projects are registered for this certificate as a matter of course. Safety and occupational health Strukton has been running the Zero Accidents programme for a number of years and it was continued in The term Zero Accidents is repeatedly used in publications on the subject of safety in order to keep the goal of zero accidents top of mind. There are regular communications giving the number of consecutive days worked without an accident resulting in absence. Furthermore, a range of company-wide initiatives are used to continually draw the attention of staff to the issue of safety. Strukton Rail started the Safety First campaign to encourage safety awareness and safe practices. In addition, Safety Awareness Team Training Courses were organised. The aim of these courses 20 Strukton Annual Report 2011

21 Corporate social responsibility is to develop a critical attitude to safety among staff and to teach them to pass on key safety information to their fellow workers. Strukton Civiel organised the Safety Experience. This was a two-day long meeting in which foremen, chief foremen and building site workers received instruction and training in various safety aspects: building scaffolding, using drilling tools with and without dust extraction, and using personal protective equipment such as hearing protection and a new helmet with safety glasses. A Safety Masterclass was also developed in In 2012 this will be given to directors, project managers and chief foremen in order to further encourage an awareness of safety and safe practices. Strukton Bouw paid considerable attention to the Last-Minute Risk Analysis (LMRA) in The LMRA is a brief risk assessment for a specific task, made by the person who will be carrying out the task. The analysis consists of three steps: assessing the dangers, determining the measures to eliminate those dangers and taking action. An LMRA flyer was produced and publicised among those staff who work at the building sites. There are checks during audits to see whether the flyer is really being used. The flyer has turned out to have a positive effect on safety. There was a large reduction in the number of times that something was found not to be right during an audit, in comparison with Staff attended more toolbox (safety) meetings on average in 2011 than in previous years. Like the other operating companies, Strukton Worksphere also paid systematic attention to safety. A start was made on improving the HSE structure (health, safety and the environment) within Strukton Worksphere. This was done not just through the Zero Accidents programme but also through courses repeated every year on such topics as working safely with electricity and how to recognise asbestos. Strukton Worksphere also held Safety Awareness Training Courses in Within Strukton as a whole, there were 93 accidents resulting in absence in 2011 as opposed to 81 in Strukton Bouw and Strukton Worksphere recorded record numbers of consecutive days without any accidents resulting in absence as at 31 December 2011, with 212 days and 248 days respectively. Certificates and standards In 2011 Strukton achieved various certificates and accreditation for standards. For instance, Strukton Civiel qualified for the international standard OHSAS for underwater techniques, which are frequently used by Strukton Civiel. Strukton Worksphere obtained the ISO certificate in 2011, a certificate for environmental management. This certificate shows that the operating company is investing in limiting the environmental risks to the organisation, in covering these risks and in making sure staff know how to act in the case of an emergency. Strukton Rail and Strukton Civiel already have this certificate. Furthermore, Strukton as a whole is working on obtaining ISO 26000, a selfreported standard for policy in the field of socially responsible business practices. Management development and training Despite the current difficult economic conditions, Strukton continued to invest in staff training in 2011, through various routes and training programmes. For instance, there is the Strukton Young Management training programme. This is a programme for graduates of applied and academic universities aged between 23 and 30 who have been working for Strukton for two to five years and have the ambition and potential to progress to managerial positions. In collaboration with the HU University of Applied Sciences in Utrecht, Strukton is offering a maximum of sixteen people each year a training path lasting ten months. In this path they are offered a programme focusing on cognitive development, personal development and professional development. The aim of Strukton Young Management is to give talented young people in the company the chance to develop, to retain talented staff for the company and to ensure a supply of 21 Strukton Annual Report 2011

22 Corporate social responsibility staff who are properly equipped for managerial positions. Various graduates have now progressed to middle-management positions. All sixteen participants in the programme in 2011 completed it successfully and a new group has now started on their programme. Another initiative for younger Strukton employees is Scope. This network offers employees aged 36 and younger the opportunity to develop a network within Strukton and to become acquainted with the different operating companies within Strukton. Scope members are responsible for organising project visits and other activities while the directors support the network financially. In 2011 Strukton Rail organised training courses in coaching management for managers. Follow-up workshops have been started in In the Netherlands, ProRail and the rail contractors (including Strukton Rail) and engineering consultancies have taken the initiative to develop an applied university degree in Rail Technology. They have concluded an agreement for this purpose with HU University of Applied Sciences in Utrecht. The objective is to ensure a sufficient supply of well-qualified technicians in the field of rail technology in the future. This degree subject will be available at HU University of Applied Sciences from September 2013 and a minor will be offered in rail technology from September Strukton Rail is also involved in the effort to set up a Rail College offering vocational secondary education. This is an initiative of Nederlandse Spoorwegen (Dutch Railways). A link will be made between the training offered by this college and the degree at the applied university. An intensive training course in senior project management was started at Strukton Civiel in It aims to train project managers in dealing with the increasing complexity of the projects Strukton Civiel has on its order books. In 2011 Strukton Worksphere resurrected the old principle of master/journeyman/apprentice. It freed up people to implement this. In addition, various in-company programmes were organised. A substantial number of training courses are also scheduled for Example, all non-technical staff from directors to managers and from controllers to legal officers are being given additional training in installation technology. Strukton Worksphere has chosen to do this so that every member of staff can talk knowledgeably about the operating company s core business. In 2011 Strukton Integrale Projecten implemented the Strategic Talent Management Programme. A key theme of this programme is assessment plus coaching. Targeting behavioural skills, targeting output and striving for a continual process of improvement means that every employee needs to be informed regularly about results and how they were achieved. Staff are encouraged to develop further in the specialist areas within Strukton Integrale Projecten: project management, contract management and financial management. In 2011 Strukton made a conscious effort to promote itself to the outside world. For example, one of the directors took part in the television programme Undercover Boss, in which a senior executive mixes with ordinary workers incognito. Strukton chose to take part in the programme so that it could introduce the company to a wider public and to gain favourable publicity for the construction sector. After all, there is a need for enthusiastic staff, certainly in the longer term, which is why it is important to get people interested in the company s business. Another reason for taking part in the programme was to generate pride in the company. That pride in their company ensures growth and development among its staff, which is something Strukton considers very important. There was a huge surge in the number of visits to Strukton s website after the transmission, as well as a large number of unsolicited job applications. The same happened after the transmissions to 193 countries around the world of the Megastructures Korean SuperLink programme on the National Geographic Channel, which featured the Busan-Geoje Fixed Link Project in South Korea. In this project, Strukton laid one of the deepest and longest immersion tunnels in the world: 3.2 kilometres long and 48 metres deep. 22 Strukton Annual Report 2011

23 Strukton Rail With the exception of Norway, all Strukton Rail countries and specialist areas achieved good results despite the fact that market conditions are still difficult in some countries. There was a very tragic accident in Sweden, in which one Strukton Rail employee died. Result and markets Countries In the Netherlands, Strukton Rail is having to deal with a very volatile market with an ongoing price war. Clients expect ever-increasing quality combined with ever-decreasing prices. The volumes of work are reasonable. In 2011, Strukton Rail maintained its market share in maintenance and projects in the Netherlands, achieving a sound profit. A major reorganisation took place in the Netherlands in 2010 and was completed early in millions of euros Revenue Operational result Number of employees (year-end) 3,125 3, Strukton Annual Report 2011

24 2011 in brief Good results achieved in all countries and specialist areas, with the exception of Norway Strukton Rail is managing to hold its own throughout Europe despite the challenging market and (political) uncertainty Machinery with high levels of production capacity is being deployed successfully across Europe The organisation is future proof Operations in Norway have been discontinued An interesting project has been secured in Australia These changes made it possible for Strukton Rail to maintain its strong position in the difficult Dutch market. A good result was also obtained in Belgium. Germany was able to finish 2011 with a break-even result and its organisation is up to strength. The organisation in Germany has been given a more international market profile with a focus on the use of sophisticated machinery with high levels of production capacity. There was a fatal accident in Sweden, in which one Strukton Rail employee died. The accident has had an enormous impact within the company. Strukton Rail regrets this incident intensely. In terms of business, things are going very well in Sweden. Strukton Rail is in a strong position both with regard to size and with regard to the quality of its work. Clients consider the company to be reliable and a player that stands out from the crowd. Sweden will be the main driving force in Scandinavia. A modest profit was recorded in Denmark in Healthy results were also achieved for Italy, mainly in Italy itself but with some revenue from the Balkans. In Norway, Strukton Rail was unable to build up the organisation to the desired level. The company also sees insufficient continuity and perspectives in the Norwegian market. Consequently Strukton Rail decided in January 2012 to discontinue its operations in Norway with immediate effect. Specialist fields Strukton Systems recorded excellent results in 2011, as it did in This business unit performed well, both in track-related work and in all the product-market combinations (PMCs), including Energy Solutions, Cable, Electric, Monitoring & Travel Systems, Telecom & Technical Installations, Signalling & Power Supplies and Installation Services. Strukton Rolling Stock made a profit in 2011 and is now in a further development phase. It works on electrical systems in rail vehicles and offers all-in train maintenance in partnership with Strukton Rail Equipment. This varies from renovation to mechanical maintenance and repairs. Rolling Stock also designs, engineers, manufactures and installs electrical and electronic systems such as panels, switch boxes and cabling. Its principal specialist field is traction electronics for driving and controlling trains. Strukton Rolling Stock has developed a mature product range of on-board power supply systems and traction electronics. Eurailscout achieved a break-even result in This business unit remains a key priority and of great strategic importance for data management and verifying track maintenance status. 24 Strukton Annual Report 2011