Fincantieri Announces Financial Results

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(Image Courtesy: Fincantieri)

Board of Directors Approves Q1 2020 Results: Revenues at 1.3 Billion, Total Backlog at 31.9 Billion

Primary Objectives: Employees Safety and Backlog Safeguard

COVID-19 Update

  • Production activities gradually resumed since April 20, 2020 and prompt deployment of all necessary measures to ensure the health and safety of our employees and those of our subcontractors
  • To safeguard the relationships with strategic clients and to ensure the acquired backlog, the business strategy is now focused on reassessing dates, to avoid any cancellations of acquired orders, in full collaboration with clients
  • Q1 production volumes recorded a 20% reduction due to the interruption of production activities in all Italian shipyards and production plants starting as of March 16, 2020

Consolidated Q1 2020 results

  • Revenues at euro 1,307 million (euro 1,368 million at March 31, 2019) down by only 4.5% compared to Q1 2019, despite the reduction of production time of 20% due to the suspension of operations in the Group’s Italian shipyards and production plants, resulting in approximately euro 190 million loss in revenues 
  • EBITDA at euro 72 million (euro 92 million at March 31, 2019) including the reduction in production volumes in the Group’s Italian sites, EBITDA margin 5.5% (6.7% at March 31, 2019). The lack of progress in shipbuilding projects, due to the suspension of activities, led to a shortfall in EBITDA of approx. euro 15 million
  • In addition to EBITDA shortfall due to the Italian sites production downtime, the effects of COVID-19 on Q1 2020 results, amounting to euro 23 million, are accounted in the extraordinary expenses and are mainly attributable to a reduced operating leverage, as a consequence of the lower production volumes, and to expenses for ensuring personnel health and safety
  • Net Debt   at euro 444 million (euro 736 million at December 31, 2019)
  • Total backlog  at euro 31.9 billion, covering approximately 5.5 times 2019 revenues, with Q1 order intake at euro 0.3 billion: backlog at euro 27.7 billion (euro 30.7 billion at March 31, 2019) with 92 ships in backlog; soft backlog at approximately euro 4.2 billion (approximately euro 3.6 billion at March 31, 2019)
  • 8 vessels successfully delivered in the quarter, among which “Seven Seas Splendor”, ultra-luxury cruise ship for Regent, brand owned by Norwegian Cruise Line Holding Ltd, “Scarlet Lady”, the first of a four cruise ships for the Shipowner Virgin Voyages; “Le Bellot”, expedition cruise vessel for Ponant and a naval vessel for the US Navy

Other key events

  • Outstanding result for Fincantieri Marinette Marine chosen as prime contractor by the US Navy within the “FFG(X)” program:  the company was awarded a nearly 800 million dollars contract for the concept design and construction of the first-in-class guided missile. The contract envisages the option for further 9 units, with a cumulative value of 5.5 billion dollar.
  • Completed the load-bearing structure of the new bridge in Genoa in record time: all the 19 steel spans had been raised by the end of April 2020 demonstrating the Group’s capability to deal with highly complex non-naval infrastructure projects even in emergency situations
  • VARD enters the promising renewable energy sector: the experience gained in the design and construction of specialized vessels enabled, after the end of Q1 2020, the acquisition of an order for one Service Operation Vessel (SOV) conceived to perform maintenance operations at offshore wind farms, reaffirming the diversification strategy envisaged by Fincantieri for its subsidiary
  • Acknowledgment of Group efforts towards sustainability: the Group’s commitment to fight climate change was rated B by the Carbon Disclosure Project . The Group positioned itself in the top cluster of Vigeo Eiris  chart, gaining the highest placement among its reference peers.
  • further 9 units, with a cumulative value of 5.5 billion dollar.
  • Completed the load-bearing structure of the new bridge in Genoa in record time: all the 19 steel spans had been raised by the end of April 2020 demonstrating the Group’s capability to deal with highly complex non-naval infrastructure projects even in emergency situations
  • VARD enters the promising renewable energy sector: the experience gained in the design and construction of specialized vessels enabled, after the end of Q1 2020, the acquisition of an order for one Service Operation Vessel (SOV) conceived to perform maintenance operations at offshore wind farms, reaffirming the diversification strategy envisaged by Fincantieri for its subsidiary
  • Acknowledgment of Group efforts towards sustainability: the Group’s commitment to fight climate change was rated B by the Carbon Disclosure Project. The Group positioned itself in the top cluster of Vigeo Eiris chart, gaining the highest placement among its reference peers.

Sea News, May 15

Baibhav Mishra
Author: Baibhav Mishra

Associate Editor, Sea News