Arcadis Q4 and Full Year 2024 Results: Record earnings per share, record backlog, enhanced long term visibility
PRESS RELEASE | Arcadis Fourth Quarter and Full Year Results 2024
Record earnings per share, record backlog, enhanced long term visibility
FOURTH QUARTER
- Strong Order Intake of €1.0 billion resulting in Book to Bill of 1.04x
- Record fourth quarter operating EBITA margin of 12.6% (Q4‘23: 11.4%)
- Free Cash Flow generation of €183 million (Q4‘23: €208 million)
- Bolt-on acquisition of Data Center Design business in Germany
FULL YEAR
- Record backlog of €3.7 billion, organic growth of 16%, from large multi-year project wins driving visibility
- Record net revenues of €3.9 billion, organic growth of 5%
- Strong Operating EBITA margin improvement to 11.5% (2023: 10.4%)
- Net debt / Operating EBITDA of 1.3x, reflecting strong balance sheet
- Record earnings per share (EPS) of €2.70, proposed dividend increased by 18% to €1.00 per share (2023: €0.85)
- On track to deliver strategic targets set for 2024-2026 strategy cycle “Accelerating a Planet Positive Future”
Amsterdam, 13 February 2025 – Arcadis, the world’s leading company delivering data-driven sustainable design, engineering, and consultancy solutions for natural and built assets, reports strong full year results well on track to achieve its 2026 strategic targets. Record backlog of €3.7B provides significant visibility on future performance. Net revenues of €3.9B result in 5% organic growth. A record fourth quarter Operating EBITA margin of 12.6% led to 11.5% for the full year (2023: 10.4%). With a record EPS of €2.70, Arcadis proposes to increase its dividend by 18% to €1.00 per share.
Alan Brookes, CEO Arcadis, said: “Arcadis has achieved significant milestones in the first year of its strategic cycle “Accelerating a Planet Positive Future, 2024-2026”. We executed successfully on our strategic plan, expanding our Key Client program, automating our processes, training our people and increasing contribution of our Global Excellence Centers. This has driven sustained margin expansion and further strengthened our strong market positions. In a fast-changing environment, we have been able to secure a record order intake providing long term visibility and anchoring our positions with our key clients. We continue to see sustained commercial momentum on long term projects despite increased volatility from geopolitical uncertainty following a high number of elections in 2024 weighing on short-term spending patterns. In 2025, we will accelerate the investments in our strategy implementation. Our record backlog, increased pipeline and highly qualified teams, position us well to deliver on our 2024-2026 strategic targets.”
KEY FIGURES*
| in € millions | Full Year | | Fourth Quarter | ||||
| Period ended 31 December 2024 | 2024 | 2023 | change | | 2024 | 2023 | change |
| Net revenues | 3,880 | 3,759 | 3% | | 959 | 941 | 2% |
| Organic growth (%)1) | 4.5% | 9.0% | | 2.8% | 6.5% | ||
| Operating EBITDA2) | 557 | 506 | 10% | | 149 | 137 | 9% |
| EBITA | 418 | 343 | 22% | | 112 | 83 | 34% |
| Operating EBITA2) | 447 | 391 | 14% | | 120 | 107 | 12% |
| Operating EBITA margin (%) | 11.5% | 10.4% | | 12.6% | 11.4% | ||
| Net Income | 243 | 160 | 52% | | |||
| Net income per share (EPS, in €) | 2.70 | 1.78 | 51% | | |||
| NIfO per share (in €)3) | 3.00 | 2.51 | 19% | | |||
| Dividend (proposal) per share (in €) | 1.00 | 0.85 | 18% | | |||
| Net Working Capital (%) | 10.8% | 9.3% | | ||||
| Free Cash Flow4) | 228 | 190 | 20% | | 183 | 208 | -12% |
| Net Debt / Operating EBITDA | 1.3x | 1.7x | | ||||
| Order intake | 4,442 | 3,899 | 14% | | 998 | 1,028 | -3% |
| Backlog net revenues | 3,673 | 3,155 | 16% | | |||
| Backlog organic growth (%, yoy)1) | 16.3% | 4.0% | | ||||
| Voluntary employee turnover5) | 11.0% | 11.7% | | ||||
* Most of these metrics are alternative performance measures; refer to the footnote on page 6 for more information
1) Underlying growth excludes the impact of FX, acquisitions, footprint reductions, winddowns or divestments. 2) EBIT(D)A excludes restructuring, integration, acquisition, and divestment costs. 3) Net income before non-recurring items (e.g. valuation changes of acquisition-related provisions, acquisition & divestment costs, expected credit loss on shareholder loans and corporate guarantees and one-off pension costs). 4) Free cash flow: Cash flow from operations adjusted for Capex and Lease liabilities. 5) Voluntary turnover excludes the Middle East as these operations are being wound down.
REVIEW OF THE FOURTH QUARTER 2024
Net revenues totaled €959 million with an organic growth of 3%, driven by our key markets in the US and the Netherlands, while being offset by project phasing in Mobility and Intelligence, and some volatility in clients’ short-term spending on the back of geopolitical developments. Good order intake in the quarter was driven by Resilience and Places, while Mobility fell slightly following a very strong third quarter with multiple large, multi-year wins. Operating EBITA margin improved to a record fourth quarter high of 12.6% (Q4‘23: 11.4%) driven by an optimized portfolio and a higher Global Excellence Centers (GEC) contribution.
REVIEW OF THE FULL YEAR 2024: PROFIT & LOSS ITEMS AND BACKLOG
Net revenues totaled €3.9 billion with an organic growth of 5%, reflecting good growth in Energy Transition, Climate Adaptation and Intelligent Highway solutions while being offset by the impact of increased selectivity in project pursuits. The operating EBITA margin increased to 11.5% (2023: 10.4%) driven by continued focus on sustainable project choices, a higher GEC contribution and internal efficiencies from standardization and automation efforts. Non-operating costs were €29 million driven by portfolio optimizations and merging of our offices.
Net financing expenses were €53 million (2023: €65 million), decreasing year on year as a result of an increased net derivative asset position. Net Income increased by 52% to €243 million (2023: €160 million) leading to a record EPS of €2.70. Net Income from Operations (NIfO) increased by 20% to €270 million (2023: €226 million), or €3.00 per share (2023: €2.51), as a result of improved performance.
Backlog Net Revenues ended at a record €3.7 billion resulting in an organic growth of 16%. A record order intake of €4.4 billion was driven by projects for clients in Mobility, Technology, Energy Transition and Climate Adaptation, and resulted in a Book-to-Bill of 1.14x for the year. Our strong backlog position and growing project pipeline are providing significant visibility on future performance.
OPERATIONAL HIGHLIGHTS
RESILIENCE
| (38% of net revenues) | | | | | | | |
| in € millions | Full Year | | Fourth Quarter | ||||
| Period ended 31 December 2024 | 2024 | 2023 | change | | 2024 | 2023 | change |
| Net revenues | 1,448 | 1,343 | 8% | | 360 | 336 | 7% |
| Organic growth1) | 7.7% | 10.6% | | 6.6% | 6.6% | ||
| Operating EBITA2) | 194 | 159 | 22% | | |||
| Operating EBITA margin (%) | 13.4% | 11.8% | | ||||
| Order intake | 1,539 | 1,457 | 6% | | 396 | 350 | 13% |
| Backlog net revenues | 1,052 | 953 | 10% | | |||
| Backlog organic growth (%, yoy)1) | 8.3% | 11.5% | | ||||
Resilience performance continued to be strong in the fourth quarter of 2024 with ongoing selectivity towards Key Clients in high growth markets, capitalizing on Arcadis’ market positions. Despite elections and geopolitical events, our key markets US and Europe remained healthy with good wins in Energy Transition and PFAS supporting strong order intake, while significant pipeline opportunities emerged in Climate Adaptation. During 2024 we were awarded 8 AMP8 framework agreements in the UK, which will support our order intake and net revenues in coming years, with investments to accelerate over the respective cycle of 2025-2030. A significant improvement in margin was driven by an improved project portfolio and automation & standardization in our project pursuit process, in line with our priorities for the first year of our strategic cycle for 2024-2026.
PLACES
| (38% of net revenues) | | | | | | | |
| in € millions | Full Year | | Fourth Quarter | ||||
| Period ended 31 December 2024 | 2024 | 2023 | change | | 2024 | 2023 | change |
| Net revenues | 1,479 | 1,509 | -2% | | 365 | 372 | -2% |
| Organic growth (%)1) | 1.3% | 2.7% | | 0.9% | 1.4% | ||
| Operating EBITA2) | 151 | 137 | 10% | | |||
| Operating EBITA margin (%) | 10.2% | 9.1% | | ||||
| Order intake | 1,646 | 1,479 | 11% | | 421 | 401 | 5% |
| Backlog net revenues | 1,637 | 1,504 | 9% | | |||
| Backlog organic growth (%, yoy)1) | 8.8% | -2.7% | | ||||
Places revenue was strong for the full year for Canada and Continental Europe, while being offset by further repositioning of the portfolio through selectivity and our focus on high end solutions. At the same time this resulted in a sustained operating margin expansion. Strong order intake development was driven by good wins in the data center, semiconductor and public facilities space. AI investments and the subsequent need for increased energy and water supply in the technology sector are fueling the demand for our sustainable and integrated solutions and driving significant pipeline opportunities.
MOBILITY
| (22% of net revenues) | | | | | | | |
| in € millions | Full Year | | Fourth Quarter | ||||
| Period ended 31 December 2024 | 2024 | 2023 | change | | 2024 | 2023 | change |
| Net revenues | 861 | 814 | 6% | | 211 | 207 | 2% |
| Organic growth1) | 5.7% | 13.3% | | 1.7% | 11.5% | ||
| Operating EBITA2) | 100 | 91 | 10% | | |||
| Operating EBITA margin (%) | 11.6% | 11.1% | | ||||
| Order intake | 1,164 | 860 | 35% | | 155 | 246 | -37% |
| Backlog net revenues | 872 | 575 | 52% | | |||
| Backlog organic growth (%, yoy)1) | 53.3% | 9.5% | | ||||
Mobility recorded strong revenue growth for the full year driven by sizeable project delivery in the US as well as through leveraging of our European workforces’ skillset and GEC engagement. Quarterly growth was impacted by a number of current large projects coming to their end, while at the same time we commenced the initial phases of large, multi-year projects won earlier in 2024. The significant order intake resulted in improved visibility on future performance, while increased investments across our key geographies drive additional pipeline opportunities. The Mobility business achieved solid margin improvement, driven by a higher GEC contribution, internal efficiencies from standardization and automation efforts, while absorbing sizeable investments in the digital space.
INTELLIGENCE
| (2% of net revenues) | | | | | | | |
| in € millions | Full Year | | Fourth Quarter | ||||
| Period ended 31 December 2024 | 2024 | 2023 | change | | 2024 | 2023 | change |
| Net revenues | 93 | 94 | -1% | | 23 | 27 | -13% |
| Organic growth1) | -0.5% | 24.5% | | -11.9% | 35.8% | ||
| Operating EBITA2) | 9 | 11 | -14% | | |||
| Operating EBITA margin (%) | 10.1% | 11.6% | | ||||
| Order intake | 94 | 104 | -10% | | 26 | 31 | -16% |
| Backlog net revenues | 113 | 123 | -9% | | |||
| Backlog organic growth (%, yoy)1) | -2.6% | 8.9% | | ||||
Intelligence started accelerating its investments in product strategy and development, technology platform harmonization, advanced data analytics and AI. The leveraging of existing client relationships and integration of Intelligence solutions into offerings from other GBAs continued to act as a differentiator in winning large-scale projects, such as AMP8 wins in the UK, Fraser River Tunnel in Canada and the Georgia Department of Transportation in the US.
BALANCE SHEET & CASH FLOW
We achieved Net Working Capital as percentage of annualized quarterly gross revenues of 10.8% (2023: 9.3%). As a result, Days Sales Outstanding (DSO) was 61 days (2023: 56 days). Free cash flow was €183 million for the quarter resulting in €228 million for the full year (2023: €190 million), driven by improved performance and disciplined net working capital management. The strong cash performance resulted in further deleveraging from 1.7x Net debt / operating EBITDA in 2023 to 1.3x for 2024, below the strategic target range of 1.5 – 2.5x. Net debt decreased to €739 million (2023: €873 million) and includes a €51 million share buyback program for long term incentive purposes.
COST SYNERGIES FROM IBI AND DPS ACQUISITION MATERIALIZED
Cost synergy realization from IBI and DPS acquisitions in 2022 has materialized well in line with expectations to €20 million (2023 year end: €5 million) through the rationalization in workplaces, IT integration and technology platform improvements, as well as the rationalization of overheads, insurance and support driving operational synergies.
ACQUISITION OF KUA GROUP
On 12 February 2025, Arcadis entered into a definitive agreement to purchase KUA Group (KUA) for €70 million on a cash and debt free basis, representing ~8x KUA’s 2024 EBITDA. KUA is one of Germany’s leaders in complex data center design and excels in architecture, design and engineering, and planning and permitting services. These capabilities complement Arcadis’ strengths in site selection due diligence, program and cost management, and sustainability advisory.
KUA has successfully delivered significant growth, nearly doubling its revenue over the last 3 years. Germany, the second largest data center market in Europe, is seeing accelerated growth of AI investments. Data centers are a key growth area for Arcadis’ Places and Resilience GBAs, and this acquisition will significantly enhance our position in the European market creating substantial revenue synergy opportunities.
2024-2026 Strategy “accelerating a planet positive future”
On 16th November 2023 Arcadis presented its 2024-2026 Strategy “Accelerating a planet positive future” and its 2026 targets. Financial targets include: organic net revenue growth of mid to high single digits over the cycle, operating EBITA margin of 12.5% in 2026, Net Debt / Operating EBITDA of
1.5 – 2.5x with an Investment Grade credit rating and a dividend payout ratio of 30 – 40% of Net Income from Operations.
ARCADIS KEY FINANCIAL METRICS*
| in € millions | Full Year | | Fourth Quarter | ||||
| Period ended 31 December 2024 | 2024 | 2023 | change | | 2024 | 2023 | change |
| Gross revenues | 4,995 | 5,003 | 0% | | 1,244 | 1,289 | -3% |
| Net revenues | 3,880 | 3,759 | 3% | | 959 | 941 | 2% |
| Organic growth (%)1) | 4.5% | 9.0% | | 2.8% | 6.5% | ||
| EBITDA | 529 | 458 | 16% | | 141 | 113 | 25% |
| EBITDA margin (%) | 13.6% | 12.2% | | 14.7% | 12.0% | ||
| Operating EBITDA2) | 557 | 506 | 10% | | 149 | 137 | 9% |
| Operating EBITDA margin (%) | 14.3% | 13.4% | | 15.5% | 14.5% | ||
| EBITA | 418 | 343 | 22% | | 112 | 83 | 34% |
| EBITA margin (%) | 10.8% | 9.1% | | 11.7% | 8.9% | ||
| Operating EBITA2) | 447 | 391 | 14% | | 120 | 107 | 12% |
| Operating EBITA margin (%) | 11.5% | 10.4% | | 12.6% | 11.4% | ||
| Effective income tax rate | 29% | 29% | | ||||
| Net income | 243 | 160 | 52% | | |||
| Net income per share (in €) | 2.70 | 1.78 | 51% | | |||
| Net income from Operations (NIfO)3) | 270 | 226 | 20% | | |||
| NIfO per share (in €)3) | 3.00 | 2.51 | 19% | | |||
| Dividend (proposal) per share (in €) | 1.00 | 0.85 | 18% | | |||
| Avg. number of shares (millions) | 90.0 | 89.8 | | ||||
| Net Working Capital (%) | 10.8% | 9.3% | | ||||
| Days Sales Outstanding (days) | 61 | 56 | | ||||
| Free Cash Flow4) | 228 | 190 | | 183 | 208 | -12% | |
| Net debt | 739 | 873 | -15% | | |||
| Net debt / Operating EBITDA | 1.3x | 1.7x | | ||||
| Order intake | 4,442 | 3,899 | 14% | | 998 | 1,028 | -3% |
| Order intake organic growth (%)1) | 13.7% | 9.5% | | ||||
| Book-to-bill5) | 1.14 | 1.04 | 10% | | 1.04 | 1.09 | -5% |
| Backlog net revenues | 3,673 | 3,155 | 16% | | |||
| Backlog organic growth (%, yoy)1) | 16.3% | 4.0% | | ||||
| Voluntary employee turnover6) | 11.0% | 11.7% | | ||||
* Most of these metrics are alternative performance measures; refer to reconciliation to the most directly comparable IFRS measures provided in “Alternative Performance Measures” section of “Arcadis 2024 Financial Report” on page 334, available at Arcadis website:
1) Underlying growth excludes the impact of FX, acquisitions, footprint reductions, winddowns or divestments
2) EBIT(D)A excludes restructuring, integration, acquisition, and divestment costs
3) Net income before non-recurring items (e.g. valuation changes of acquisition-related provisions, acquisition & divestment costs, expected credit loss on shareholder loans and corporate guarantees and one-off pension costs)
4) Free cash flow: Cash flow from operations adjusted for Capex and Lease liabilities
5) Book-to-bill: Order intake / Net revenues
6) Voluntary turnover excludes the Middle East as these operations are being wound down
FINANCIAL CALENDAR
- 7 May 2025 - Q1 2025 Trading Update
- 16 May 2025 - Annual General Meeting of Shareholders
- 31 July 2025 - Q2 & Half Year 2025 Results
- 30 October 2025 - Q3 2025 Trading Update
Arcadis IR investor calendar:
ARCADIS INVESTOR RELATIONS
Christine Disch | +31 (0)615376020 |
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ABOUT ARCADIS
Arcadis is the world’s leading company delivering data-driven sustainable design, engineering, and consultancy solutions for natural and built assets. We are more than 35,000 architects, data analysts, designers, engineers, project planners, water management and sustainability experts, all driven by our passion for improving quality of life. As part of our commitment to accelerating a planet positive future, we work with our clients to make sustainable project choices, combining digital and human innovation, and embracing future-focused skills across the environment, energy and water, buildings, transport, and infrastructure sectors. We operate in over 30 countries, and reported €5.0 billion in gross revenues for 2024.
REGULATED INFORMATION
This press release contains information that qualifies or may qualify as inside information within the meaning of Article 7(1) of the EU Market Abuse Regulation.
DISCLAIMER
Statements included in this press release that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward-looking statements. These statements are only predictions and are not guarantees. Actual events or the results of our operations could differ materially from those expressed or implied in the forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may”, “will”, “should”, “expect”, “could”, “intend”, “plan”, “anticipate”, “estimate”, “believe”, “continue”, “predict”, “potential” or the negative of such terms and other comparable terminology. The forward-looking statements are based upon our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements.
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