Deerns Group
www.deerns.com
Annual Report 2010
Healthy living and working environment Mission critical facilities Sustainability and energy New techniques Safety and security
Growing beyond boundaries
Annual Report 2010
Growing beyond boundaries New exciting challenges present themselves on a daily basis. Challenges that require our creative talent, technical expertise and ability to explore and apply new p ossibilities, often in close cooperation with partners. The world is changing at top speed and Deerns makes sure to change accordingly. This we do in the vanguard of our field of expertise. Ever more often we explore the limits of this field, enabling us to come up with innovative designs and solutions and technical innovations c ontribute ever more significantly to sustainability and energy saving, to a pleasant and safe living and working environment, and to our clients’ success, both nationally and internationally. We are constantly in pursuit of a new optimum. That’s our challenge. In this annual report we explain how we proceed. Deerns brings concepts to life.
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Deerns Annual Report 2010
Foreword
Over the year 2010 our firm has seen a gradual recovery from the setback incurred in 2009 as a result of the global economic crisis. In 2009, our revenues dropped by almost 6% and results almost halved; in 2010 revenue grew a little again, and financial results rose, though our overall profitability has not yet returned to pre-crisis levels. Our largest market, the Dutch, was lackluster and in the first half year sales here were still too low to fully utilize capacity. Fortunately, performance in our second largest market, Germany, was very good, both in our Cologne and Berlin offices. Our USA activities, started a few years ago, boded for promising developments but still required investments in 2010 to establish their market position. By contrast, the new office opened in Paris in July has proven profitable already after half a year of business in France.
The year 2010 also saw a number of important steps on our path to sustainability in our operations, while we also worked hard to increase our ‘sustainability leverage factor’ through energy and material efficient design work with many of our clients and in a wide range of projects, ranging from hospitals to data centers, from airports to office buildings. This work resulted in a number of highly innovative projects – varying from the extremely environmentally sound TNT Headquarters and the TransPort building in The Netherlands, both awarded a ‘LEED Platinum’ certificate. Also, a range of projects (Education center ROC Twente, Museum The Hermitage in Amsterdam and office building TransPort at Schiphol Airport) won ‘De Nederlandse Bouwprijs’ (the best renovated and transformed buildings in The Netherlands 2010).
While recovering from the difficult situation in 2009, we have continued investing in talented staff, in the development of international practices, and in diversifying our activities in the Dutch market. We stick to our core competences of mechanical, electrical, energy and sustainability consultancy and design work, but will no longer restrict ourselves in applying these just to buildings.
We are proud to present to you on the following pages a more extensive overview of our activities and results achieved in 2010, and we look forward to meeting you in 2011.
In 2010, we also made steps towards our internal development from what is still essentially a Dutch firm with a number of foreign offices, into a truly international firm, deeply rooted in Western Europe and with a relevant presence in selected other parts of the world. Thus, we have further developed our capabilities to serve clients, combining essential local know-how and cultural understanding with global practice competences, e.g. in airport, data center, clean room, and sustainable office design.
Jan Karel Mak President of the Board
Growing beyond boundaries
Contents
Foreword
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Part 1: Deerns overview
5 6 7 8 9
Key figures Profile Strategy Markets and clients
The five Deerns themes Healthy living and working environment Mission critical facilities Sustainability and energy New techniques Safety and security
Part 2: Governance
10 11 12 13 14 15
Board of Directors Report of the Supervisory Board Corporate Social Responsibility Human Resources
17 18 21 22 24
Financial Results
25
Part 3: Outlook 2011
37
Part 4: Personalia Management and Board of Directors Organisation Chart Memberships and Social contributions
41 42 43 44
Addresses
45
Colophon Text and editing Deerns, Smidswater Design Smidswater Photography Jeroen Dietz, Getty Images, Hollandse Hoogte, iStock Print Edauw+Johannissen Drukkerij
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Growing Deerns Annual beyond Report 2010 boundaries
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Olivier Severini / Managing Director at Deerns France Joining Deerns was a conscious decision. The firm is fundamentally well thought out, with a beautifully balanced client portfolio. And now I would like to make a contribution to the international expansion. Obviously the firm is strong as it is in both the Netherlands and Germany, but it is not quite well known in France for instance. This country has many opportunities on offer when sustainability expertise is involved. And sustainability is precisely what Deerns’ DNA is all about. I noticed that we are being accepted here in France. We work together with the locals and at the same time we are the extension of a Dutch firm. That is how we are introducing new ideas and new technologies onto the market. These technologies, however, have already proven themselves on other markets. Now Deerns has consciously decided to internationalise, to engage the best engineers and grow along with international clients.
‘Deerns has the potential to grow at the European level’
Growing beyond boundaries
PART 1
Deerns overview Key figures Profile Strategy Markets and clients
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Deerns Annual Report 2010
Key figures
Deerns Group (â‚Ź ) Revenue Net Result Return on Assets Solvency Current Ratio Staff (fte)
2010
2009
2008
45,644,871 2,845,917 14.5% 40.8% 1.56 446
44,785,877 1,231,284 8.0% 32.8% 1.35 432
45,905,458 3,027,711 22.1% 27.4% 1.12 417
Growing beyond boundaries
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Profile
The Deerns Group is an international technical consultancy and engineering firm that helps clients build a sustainable, comfortable and safe built environment. To that end, we develop the technical and technological infrastructure of buildings and related facilities, from the first concept to detailed design and construction management. Deerns strives to be a leading firm, making our wide range of skills, knowledge and experience available to our clients, leveraging the enthusiasm of our highly dedicated, serviceoriented professional and support staff.
Developing and maintaining long-lasting relationships with our clients help us deliver quality engineering, as well as understand our clients’ business processes and technical needs. We seek to maintain a profound service orientation by honoring our key values: fostering professional quality, inspiring entrepreneurship, building our reputation, maintaining high ethical standards, and warranting adequate internal and external coorperation. We are eager to improve client services and develop our business through practical innovations. We are at our best in bringing concepts to life when engineering integrated solutions for complex technical issues and complex client organisations.
To foster an innovative and professional atmosphere, we invest heavily in attracting, developing, exciting and retaining talented professionals. We maximize our added value, wherever relevant, in productive co-operation with other specialised service partners that match our ambitions and standards.
‘Engineering integrated solutions for complex technical issues’
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Deerns Annual Report 2010
Strategy
Deerns aims at enhancing its position as a prominent European consulting and design firm, specialised in building services and ‘mission critical’ facilities design, and to build a distinct global presence in selected market segments, in the areas of building services, building physics, and energy consultancy, engineering and project management.
2. Service Portfolio Differentiation
To that end, we have formulated a strategy based on the following three pillars: 1. Further improving our Operational Quality 2. Differentiating our Service Portfolio in Home Markets 3. Developing Internationally
We seek to diversify our service offerings without, however, straying into activity fields that are not covered by our key competences. We diversify through: • Encouraging our professional staff to pursue new business, capitalising on our knowledge and client base; • Developing and growing new niche positions; • Seeking alliances with top-notch partners (generally specialist service providers like ourselves) to develop new business or to supplement our service offerings. In 2010 we made our first steps into Tunnel design, and further developed our Building Physics practice.
1. Towards Operational Excellence
3. International Development
Though we are seen by many as a high-quality firm, we know improvement is a continuous process, especially the improvement of work process efficiency.
We aspire to develop Deerns internationally along two avenues: • by establishing a prominent European position, working along the entire service range of our business; • by establishing global practices in market areas that are characterised by their truly international nature.
In 2010 we paid special attention to the following topics: • streamlining of project acquisition reporting and work planning procedures; • further developing our internal knowledge management systems (Lucene knowledge retrieval tool, videoconferencing network, Deerns Concept Studio, Technology Mentors, Knowledge Center for Legal and Contracting Affairs, Practice Days); • improving our Marketing/Communications performance (especially in English). Furthermore, preparations were started to replace our management information system that has now been in use for 10 years. A new system, as well as other ICT renovations (a.o. our email system) will be implemented in 2011.
In Europe, we successfully opened an office in Paris, while we mothballed our Barcelona office due to the economic situation in Spain. We furthermore made preparations for opening an office in the United Kingdom. At the global level, we made further investments in the development of our Denver office. Steps were made in the development of our global Data Center and Airports Practices; a number of significant data center projects were acquired in different parts of the world, and in the USA a watershed public contract was awarded to us by Denver International Airport, next to a range of new airport projects in the Middle East.
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Markets and clients
Deerns works for a wide range of clients, private and public, large and small. With many of our clients we have maintained a long-standing relationship, sometimes for decades on end. Just a few examples of these are Amsterdam Airport Schiphol, KPN and the Dutch National Institute for Public Health and the Environment (RIVM). Deerns offers consultancy, design, tendering and project management services in the following broadly defined market segments. • Office, commercial and mixed used buildings, hotels, leisure facilities and educational buildings (schools, universities); among our many clients are OVG Project Development, the Dutch National Building Service (RGD), Generali Deutschland Immobilien GmbH/AachenMünchener Versicherung, Bühnen der Stadt Köln, Ahoy Rotterdam, Museum Hermitage Amsterdam, Scheepvaartmuseum Amsterdam, Züblin RE Development Paris. • Airports – to whom we provide general building services as well as specialised services such as runway lighting, traffic control towers, baggage handling, customs, navigational aids and safety and security design. The practice is worldwide. Ongoing projects are in Abu Dhabi, Kuwait, Egypt, Botswana, Gibraltar, Taiwan and The Dutch Antilles. • Hospitals and other health care facilities; our work in this field is largely Dutch. Here too, we combine general building services design work with highly specialised work, e.g. regarding operation theatre climatisation, hygiene and lighting; X-ray bunkers; pharmacies; medical gases, etc. Current projects are, e.g., Reinier de Graaf Groep Delft, Isala Klinieken Zwolle, Academic Medical Centre Amsterdam, University Medical Centre Groningen, Jeroen Bosch Ziekenhuis Den Bosch, Erasmus University Medical Centre Rotterdam,
The Netherlands Cancer Institute in Amsterdam, Amphia Hospital in Breda, Academic Hospital Maastricht, Maxima Medical Center in Eindhoven, St. Franciscus Gasthuis in Rotterdam and the New Hospital Curaçao (NHC) on Curaçao. • Mission-critical facilities such as data centers, clean rooms and research laboratories; in this segment we work for clients in the telecom, banking, pharmaceuticals and research sectors. Especially the data center practice grew in 2010, with projects for existing and new corporate clients in The Netherlands, Germany, the UK, Russia and the USA, and projects for public clients in The Netherlands. • Energy conservation and sustainable buildings design; a large share of our work in the above sectors has been focused on reducing the ecological footprint of real estate development and use, and a growing number of our clients asks us to achieve LEED and BREEAM classifications – some of which were quite challenging (e.g. LEED platinum for the TransPort Building (Schiphol Real Estate Amsterdam) and the TNT Headquarters (Hoofddorp, NL), and BREEAM Excellent for the UPC offices in Leeuwarden, NL).
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Deerns Annual Report 2010
THEMES
The five Deerns 足themes Technology must be subservient to society. This is why we constantly seek to further improve the quality of our sustainability and multidisciplinary solutions. We aim for quality that ensures a perfect balance between user friendliness, the environment, safety, ease of maintenance and costs. Our project teams always make sure to look beyond their own disciplines to find that new optimum, together with the client. Our activities are dominated by five social themes.
Healthy living and working environments Mission critical facilities Sustainability and energy New techniques Safety and security
De vijf thema’s van Deerns
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Vlietland Hospital in Schiedam, The Netherlands
Healthy living and working environments ‘In our offices, our people are key. Every work space receives enough daylight. And, more importantly, the working environment is conducive to meeting and inspiring one another’ A sound working and living environment significantly improves the well-being, productivity and performance of those present. A modern indoor environment has an excellent indoor climate. Deerns has the know-how and programs available to create such an environment.
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Deerns Annual Report 2010
Mission critical facilities ‘Our data centers must perform 100% permanently. Simultaneously, we want them to match our corporate responsibility for the environment. Today, these can go together’ When operations are critically dependent on the performance of complex facilities, our client must rest assured these facilities will not fail. With our wide knowledge of processes that determine the functioning of clean rooms, data centers and surgery rooms, we at Deerns know how to avoid down-time, malfunctions and damage.
Growing De vijf thema’s beyond van boundaries Deerns
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Ille de la Jatte, Paris, France
Sustainability and energy ‘An energy efficient building was a no-brainer for us. Our challenge was to take a step beyond: a CO2-neutral building that even supplies energy’
To make progress in the area of sustainability is simply a societal priority. We create sustainable designs to help society become future-proof, and thus also deliver financial benefits for our clients. We maintain a close cooperation with architectural firms to achieve maximum energy benefits in the design phase.
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Deerns jaarvesrlag Annual Report 2010 2010
De Doelen theatre Rotterdam, The Netherlands
New techniques ‘These are challenging times. The word ‘impossible’ is not in our dictionary. We continuously investigate how innovations can improve our business processes’
To achieve progressive energy savings and to realise a sustainable society, new technical options and solutions must be developed. Deerns is consistently ahead in doing just that, making its contribution through the development of innovative technical services concepts.
Growing De vijf thema’s beyond van boundaries Deerns
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Hermitage museum Amsterdam, The Netherlands
Safety and security ‘We have implemented a security solution that is well integrated in our business processes and our sites – it magnificently leverages our safety policies’
Sound security and safety systems ensure continuous, undisturbed operations. They help prevent fires, criminal acts, equipment failure and interruptions of data transmission. Deerns is capable of planning safety and security systems and procedures that balance security concerns, risk management processes, existing regulations and budgetary concerns.
Growing Deerns Annual beyond Report 2010 boundaries
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Paul Stoelinga / Senior Advisor We constantly apply new technologies and insights to drastically improve energy efficiency. A good example is the use of industrial residual heat at 40 to 50 degrees. That is insufficient for the industry however you can perfectly use it for heating houses. This heat is almost for free however the house does require a large surface area for heat emission purposes. You also need to come up with a solution for tap water. Dynamic design calculations are required to ensure the house really becomes comfortable. Another challenge is using the deep geothermal resources with water that can reach no less than 90 degrees. It is worthwhile provided you can use it at a large scale and provided it also lends itself to existing buildings. This means studying energy at district level or business park level. Economically, heat networks can be, however, on bad terms with the houses’ increasingly declining demand for heat. In short, enough challenges lie ahead of us.
‘In 10 years’ time energy-neutral districts will be profitable’
Growing beyond boundaries
PART 2
Governance Board of Directors Supervisory board Corporate Social Responsibility Human Resources Financial results
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Deerns Annual Report 2010
Board of Directors
Gradual market recovery In our largest market, The Netherlands, the year 2010 has not been easy. In the first half, we struggled with a sluggish market in the Laboratories and Data Center segment, resulting in overcapacity in this group. In our regional practice North (Groningen office) too, we faced some underutilization. By contrast, our Office Building practice flourished despite the commercial real estate crisis, thanks to our solid position in designing sustainable office buildings, both for public clients (e.g., the Ministries of Justice and Internal Affairs) and private corporations (e.g., OVG Real Estate and their clients such as TNT and UPC). In our Health Care practice, some client hospitals slowed or postponed projects due to financing uncertainties, but we simultaneously acquired a few new clients, resulting in a further rise of market share. The financial stress on the hospital sector necessitated difficult negotiations with some large clients, however, and the practice has found it difficult to yield the financial results that one would expect from a market leadership position. The Airport Practice was strong and yielded a relatively good result. New projects were acquired, especially in the Middle East, and prospects here are good despite payment problems with one large client in this region. To bring profitability in the Netherlands back to an acceptable level, we have intensified the governance of our twelve business units, with four directors each focusing more closely on supporting three of these. Operational focus was increased on key factors such as efficiency in design processes and acquisition quality, and sick leave rates and prevention were also given extra attention. In 2010 the external public relations in the Netherlands received a boost from a new corporate magazine and a new electronic newsletter for external relations and a wholly revised Dutch website. In Germany, both our offices were particularly successful. Schmidt Reuter (Cologne) was able to substitute cancelled or halted projects with new ones without losing productivity; we further developed our position in high-end office buildings, made further steps into the data center business, and saw our Research and Development group develop well with innovative work in the
area of sustainable buildings. Our Berlin office (P2B) was equally profitable, not least thanks to the big ‘Bikini Berlin’ mixed-use real estate development project, which is thus far developing well. With these two offices we have a high-quality presence in this large EU market, which should be relatively promising in view of the current economic situation in Germany. However, specific local complexities dictate a certain level of prudence; in 2010, too, competitors went bankrupt buckling under contracts for large projects (e.g., the European Central Bank in Frankfurt, Berlin’s new Airport) that looked attractive on the outside but were governed by untenable contract conditions. Nonetheless, our reputation and experience, both in project negotiation and management and in high-performance execution, offer us a good starting position for profitable growth in Germany. Among the operational improvements Schmidt Reuter realised was a major improvement of its proprietary website. In the United States, we had a shift of the management and encountered a delay in our development. Building our reputation and market presence has taken more time than anticipated. However, in 2010 we did acquire a major contract with Denver International Airport, which not only will provide our office there with a steady project flow in the years to come, but also greatly enhances our credibility with potential government clients. Our new Denver office in the ‘Taxi Building’ office complex was opened in the autumn; we share an inspiring work environment here with a number of other smaller innovative professional services and creative companies. Beyond the Denver region, we have started to build a network presence in the Airport design and Data Center design practices, the latter with a focus on the East coast. Things developed more quickly in France, where we opened a new office in the summer of 2010. Starting with a small team of experienced and dedicated consultants, working from our small Paris office, a profitable new business unit has come to life. While most of the initial work was in the area of sustainability consulting (‘Bâtiments HQE’, haute qualité environnementale), we are now also moving toward the design of new office buildings. Not only was 2010 performance good from the start, a comfortable project portfolio for 2011 has also been built.
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‘Our team in Paris has set up a profitable new business unit’
In view of the disappointing experiences and bleak prospects in the Spanish market, we have mothballed our office at Barcelona’s Paseo de Graçia according to plan. Keeping some office facilities and management capacity available at low cost, and maintaining our relationship network, we will be able to revive our Spanish presence as soon as market opportunities will start emerging. Finally, though our office in Dubai (United Arab Emirates) currently does not operate as a viable business unit in itself, it serves as a very convenient project office and support infrastructure for our ongoing Airport design projects in the Middle East.
International business development The year 2010 has seen a marked increase in the number of cross-border initiatives. This development is especially manifest in market segments that have an international character, either because of the dominance of international clients, the nature of the projects as relatively unconnected to local culture and circumstances, or because of the degree of specialisation as a result of which any national market is small in volume. Market segments that fall in one of these categories are Airports, Data Centers and Clean Rooms. Not only in countries where Deerns has offices, but elsewhere too (Eastern Europe, Middle East, East Asia) clients start to approach us. Responding to these developments, we have developed plans to build International Practices. The leaders of these practices will be charged with the task to develop and implement an international market development strategy, and to warrant quality of our work and responsiveness of our teams. This development presents a marked departure from our traditional business approach, centered around the Dutch market and regarding foreign projects as incidental occurrences rather than part of a strategic trend.
Organisational development The development of International Practices is one of two organisational adaptations of our firm to market and clientele development. The other is a transition of Deerns from a primarily Dutch firm with some ‘foreign’ offices into an international firm, in which the Dutch group of offices is one of the national organisations within the group, albeit a relatively large one. Building our international presence, providing support staff expertise to new offices as needed and recruiting and nurturing talent have become increasingly difficult tasks for the Dutch head office of Deerns raadgevende ingenieurs. The time has come for a structural improvement and a more consistent common ‘One Firm’ approach to key management tasks such as financial budgeting and reporting, public relations, marketing support, knowledge management, management development and ICT. In 2010 we started to prepare the organisational change that is required to cope with these needs. ‘Deerns raadgevende ingenieurs’ will hand its central position within Deerns to the Deerns Group holding corporation, and gradually develop into the Dutch operational company within the firm, next to the German, French, American and future other national organisations. While a large part of the projects in each of these companies will continue to have a distinctly national character, projects in our International Practices will require close cross-border cooperation – in marketing, in the early phases of project execution, in quality control and in innovation. It is foreseen that leaders of the International Practices will thus develop these in close cooperation with the management of the national companies – who will take business responsibility for each individual project and who will provide the project staff.
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Deerns Annual Report 2010
Risk Management Our prime operational risk is discontinuity of one or more offices, due to fire, power failure, internet failure, ERP software failure, IT system failure or massive illness. In 2010, we have reviewed our contingency plan, shored up our server capacity and backup, and started preparations to replace our current Axapta ERP in 2011. With our corporate health service provider in the Netherlands (Arbodienst) we have analysed sick leave numbers and discussed with the management early awareness, prevention and re-integration; this year we also provided free flu vaccinations again, to which staff response was meager, however.
Our prime financial risks are limited to project claim risks, debtor failure and to some degree currency risk. A secondary financial risk type lies in issues regarding financial management and administrative processes. After the departure this year of the financial manager in the Netherlands, measures were started to improve our financial organisation and procedures aimed at reducing such risks.
Throughout the year we performed internal quality audits in addition to the external ISO audits; the latter yielded positive results only. The risk associated with mismanagement in parts of the firm has received increasing attention through a more intensive operational guidance by the Board. Three managers (a support staff manager and a group manager in the Netherlands, and the manager in the United States) left their position in 2010.
‘Our reputation and experience give us a good starting position for profitable growth’
Growing beyond boundaries
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Report of the Supervisory Board
Deerns Group does not yet have a formally appointed Supervisory Board. Instead, the external Board members of the shareholder, the foundation “Stichting Administratiekantoor Deerns Groep BV’, fulfil an informal supervisory role. The term ‘Supervisory Board’ is used here in anticipation of a future status change of the foundation’s external board members. The Supervisory Board was composed as follows in 2010: • Paul Smits, chairman (member since 2007) • Tom Rövekamp (member since 1996) • vacancy In the reporting year, the Supervisory Board met with the Board of Directors of Deerns Raadgevende Ingenieurs BV on seven occasions. During these meetings, two of which where followed by a joint meeting with Deerns’ external Advisory Board, the following subjects were discussed.
Management and staff During a few meetings the Supervisory Board was introduced to some of the business managers of Deerns in the Netherlands to get an impression of the characteristics of these key people in the Deerns organisation. The task distribution within the Board of Directors and the development of this leadership team were also discussed.
Supervisory Board composition It was agreed that Tom Rövekamp will resign in 2011; the foreseen future composition of the Supervisory Board was discussed.
Impression of the firm’s performance The Supervisory Board is of the opinion that it has an adequate view of the performance and leadership of the enterprise. Based on this view, the Supervisory Board believes that the Deerns Group develops well.
Finance The 2009 annual figures were reviewed in the presence of the chartered accountant (Ms. Drs. M.A. Westerhout RA of Ernst & Young); the outcomes of the accountant’s audit were part of the discussion. In all meetings, attention was paid to the recovery of the enterprise from the downturn caused by the economic crisis in 2009. Moreover, the robustness of the administrative organisation and the financial management, cash flow and liquidity as well as investment policy were discussed.
Strategy In various meetings, the international development of the firm, the concurrent organisational adaptations, and a number of potential acquisitions were discussed.
Rijswijk, 12 april 2011 P. Smits, chairman T. Rövekamp
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Deerns Annual Report 2010
Corporate Social Responsibility
Being a founding member of both the Dutch Green Building Council and the new Dutch employers’ organisation The Green Cause (‘De Groene Zaak’), our efforts to contribute to a sustainable future for the planet are central to our corporate social behavior. This year, we introduced our ‘Internal CO2 lever’: the ratio of the CO2 generated by our activities and the CO2 avoided as a result of our sustainable and energy efficient design projects (as compared to the impact of an alternative ‘business as usual’ conventional design approach to these projects). Though a rough yardstick (that currently stands at 682), it will prove a useful tool to measure our progress over time. Among the practical measures we took this year are the following: • in our Dutch offices, we switched to green energy; • we adapted our Dutch company car policy and from now on only allow cars carrying the energy efficiency label ‘A’ or ‘B’; • we joined the initiative of a number of Dutch corporations to give the development of electric vehicles a market pull, and signed up for the procurement of at least 10 electric vehicles in the next three years; • since the end of 2010, all our company car drivers participate in the Green Driver Challenge. This competition aims at educating and motivating drivers to save fuel. The duration of the competition is three months and all participants receive a weekly update on their individual performances. These updates also include tips for saving fuel and CO2 emissions as well as the total score of the company.
Our explicit openness to welcoming talented professionals from any part of the world irrespective of any personal background factor, can be seen as another aspect of our corporate social policy.
‘Since the end of 2010, all our company cars participate in the Green Driver Challenge’
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The Deerns CO2 footprint This footprint was created based on the Green House Gas Protocol. The protocol categorizes the direct and indirect emissions into three scopes: • Scope 1: All direct GHG emissions. • Scope 2: Indirect GHG emissions from consumption of purchased electricity, heat or steam.
• Scope 3: Other indirect emissions, such as the extraction and production of purchased materials and fuels, transportrelated activities in vehicles not owned or controlled by the reporting entity, electricity-related activities not covered in Scope 2).
CO2-footprint calculation Scope 1
CO2- footprint 2010
Company cars Gas consumption Water consumption Air Conditioning Scope 2 Electricity Scope 3 Air travel Public ground transportation Paper Total CO2 emissions Emissions per employee (FTE)
In kg CO2 600,068 65,239 536 10,292
85,543
In 2010 we decreased our CO2 footprint, particularly in the area of mobility. We decreased our business mileage with 88,000 kilometers and 20,000 kilometers on air transport. The distance travelled by public transport has more than doubled. The total CO2 footprint for 2010 is 956 tons, the CO2 emission in kilogrammes per FTE is 2,656. CO2-reduction In Deerns’ projects compared to the Deerns CO2 footprint for 2010.
173,802 9,019 11,824 956,322 2,656
Contribution Rates Car km Gas Water Airconditioning Electricity Air travel Public ground transportation Paper
62.7% 6.8% 0.1% 1.1% 8.9% 18.2% 0.9% 1.2%
Deerns CO2 emission 2010 Deerns Multiplier When combined, the sustainability solutions in our projects have resulted in a CO2 reduction of 600,000 tons in 2010, which equals 577 times the annual emission of Deerns.
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Deerns Annual Report 2010
Human Resources
It is not just a stereotype that our staff members are our most valuable resources. We are a community of dedicated professionals, and we are aware that our staff members spend a good part of their lives in our firm. We also know that if we want to further enhance our profile as innovative consultants, we must invest in our staff by: • further diversifying our talent influx, banking on our rising preferred employer profile (offering traineeships or scholarships, recruiting via Technical University employers’ days, Career Events, sponsoring students’ organisations and university business incubators, etc.); • structuring professional development towards career development programs based on measurable skills, to be obtained via training and education milestones; • investing in the development of leadership potential: we offer MBA, MRE, Management Consultancy education to selected top talents; • designing international management development career paths. Thus, we aim to continue the virtuous cycle of acquiring top projects that attract the top talents needed to win these projects.
‘We are a community of dedicated professionals’
Growing beyond boundaries
OVERVIEW
Financial results
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Deerns Annual Report 2010
Consolidated balance sheet as per 31 December 2010 (before appropriation of result)
Assets
(â‚Ź ) 31-12-2010
31-12-2009
Fixed assets Tangible fixed assets Other fixed assets
2,011,282
2,216,114
Financial fixed assets Participations in affiliated companies
91,180
289,576
Current assets Inventories Work in progress
2,100,264
1,287,993
Receivables Trade debtors 9,072,338 9.030,466 Receivables from associated companies 307,454 37,588 Taxes and social security premiums 132,223 0 Other receivables 1,049,959 997,997 10,561,974
10,066,051
Cash and banks
5,475,347
2,363,088
Total assets
20,240,047
16,222,822
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Equity and liabilities
(â‚Ź )
31-12-2010
31-12-2009
Group equity Shareholders’ equity 7,490,131 4,731,283 Minority interest 758,994 594,696 8,249,125
5,325,979
Provisions Deferred taxes 144,125 270,000 Other provisions 200,000 470,000 344,125
740,000
Short-term liabilities Amounts owed to credit institutions 0 492,826 Trade creditors 1,961,709 1,429,464 Amounts owed to associated companies 2,695,803 2,695,803 Taxes and social security premiums 3,457,979 3,056,352 Other liabilities 3,531,306 2,482,398 11,646,797
10,156,843
Total liabilities
16,222,822
20,240,047
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Deerns Annual Report 2010
Consolidated profit and loss account for the year ended 31 December 2010
2010
2009
Net sales 44,832,600 45,029,496 Movements in work in progress 812,271 -243,619 Gross operating result 45,644,871
44,785,877
Cost of work contracted out 2,832,390 3,676,597 Other external expenses 595,025 666,084 Wages and salaries 21,825,454 21,347,909 Social security 4,662,119 4,883,252 Depreciation 823,451 1,214,809 Other operating expenses 10,534,016 10,794,820 Total operating expenses 41,272,455 Operating result 4,372,416
42,583,471 2,202,406
(â‚Ź )
Financial income and expense Result from before taxation
-79,878 4,292,538
-61,151 2.141,255
Taxes on income
-1,182,241 3,110,297
-677,844 1,463,411
Income from participations in group and associated companies Result from ordinary activities after taxation
81,127 3,191,424
-58,139 1,405,272
Minority interests Net result
-345,507
-173,988
2,845,917
1,231,284
Growing beyond boundaries
Consolidated cash flow statement
(â‚Ź )
2010
Cash flow from operating activities Operating result 4,372,416 Changes/modifications for: Depreciation 887,725 Movements in provisions -395,875 Movements in minority interest 164,298 656,148 Movement in working capital: Inventories -812,271 Receivables -495,923 Short-term liabilities (banks excluded) 1,982,780 674,586 Cash flow from operating activities 5,703,150 Payment of result of financial income and expenses -79,878 Payment of taxes on income -1,182,241 Income from participations in group and associated companies 81,127 Minority interests -345,507 -1,526,499 Total cash provided by operating activities 4,176,651 Cash flow from investment activities Investments property, plant and equipment -736,935 Disposals of property, plant and equipment 54,042 Decrease financial fixed assets 198,396 Total cash used in investing activities -484,497 Cash flow from financing activities Movements in shareholders’ equity 0 Movements in other reserves 462,931 Dividend -550,000 Total cash provided by / used in financing activities -87,069 Movements in cash funds 3,605,085 The movement of funds is as follows: Balance as at 1 januari 1,870,262 Movement for the year 3,605,085 Balance as at 31 december 5,475,347
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Deerns Annual Report 2010
Notes to the consolidated balance sheet as per 31 December 2010
Assets (â‚Ź )
Fixed assets Tangible fixed assets Other fixed assets Balance as at 1 januari 2010 Costs 9,870,109 Accumulated depreciation -7,653,995 Book value 2,216,114 Movements in book value: Actual cost investments Acquisition value of disposals Depreciation Depreciations of disposals Balance as at 31 december 2010 Costs Accumulated depreciation Book value 31-12-2010 Financial fixed assets Participations in affiliated companies Participation in Bouw Commissioning Nederland B.V. (50%) Participation in Yxion Deerns Pharma B.V. (100%) Participation in Schmidt-Reuter Telematic Consult GmbH (100%) Participation in Deerns Naco B.V. (50%)
768 22,308 30,276 37,828 91,180
736,935 -2,913,206 -887,725 2,859,164 -204,832
7,693,838 -5,682,556 2,011,282
31-12-2009
5,975 22,308 30,276 231,017 289,576
Growing beyond boundaries
31
31-12-2010
31-12-2009
2,100,264
1,287,993
Trade debtors Trade debtors 9,909,622 Provision for bad debts -837,284 9,072,338
9,743,015 -712,549 9,030,466
(â‚Ź )
Current assets Work in progress Work in progress Receivables
Receivables from associated companies Receivable from Deerns Naco B.V. Reveivable from Bouw Commissioning Nederland B.V.
237,724 69,730 307,454
11,408 26,180 37,588
Taxes and social security premiums Deferred tax asset
132,223
0
Other receivables Prepaid expenses Other debtors
641,366 408,593 1,049,959
556,218 441,779 997,997
Cash and banks Cash ING Bank N.V. ABN AMRO Bank N.V. Rabobank Other banks
11,988 2,693,056 478,226 114 2,291,963 5,475,347
19,538 459,702 0 173,930 1,709,918 2,363,088
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Deerns Annual Report 2010
Equity and liabilities (â‚Ź )
31-12-2010
Minority interest Minority interest in P2B GmbH 128,132 Minority interest in Schmidt Reuter GmbH 630,862 758,994 Provisions Other provisions Other provisions 200,000
31-12-2009 40,650 554,046 594,696
470,000
Short-term liabilities Amounts owed to credit institutions Amounts owed to credit institutions
0
492,826
Trade creditors Trade creditors
1,961,709
1,429,464
Amounts owed to associated companies Amounts owed to Douwe Aukes Beheer B.V. Amounts owed to Beheer- en Beleggingsmij Giulia Groenhoven B.V.
1,447,477 1,248,326 2,695,803
1,447,477 1,248,326 2,695,803
Taxes and social security premiums Value added tax Wage tax Corporate income tax
1,745,982 693,556 1,018,441 3,457,979
1,722,062 677,367 656,923 3,056,352
Other liabilities Personnel expenses Commisions payable Other payables
1,696,595 1,246,000 588,711 3,531,306
1,455,034 363,451 663,913 2,482,398
Growing beyond boundaries
33
Notes to the consolidated profit and loss account for the year ended 31 december 2010
2010
2009
44,832,600
45,029,496
Movements in work in progress Movement in work in progress 812,271
-243,619
Cost of work contracted out Cost of work contracted out 2,832,390
3,676,597
Other external expenses Travel and reimbursement of expenses 264,423 Costs of reproductions 239,656 Other external expenses 90,946 595,025
231,508 237,163 197,413 666,084
Wages and salaries Salaries and wages 22,281,568 Re-charged salaries and wages -456,114 21,825,454
21,347,909 0 21,347,909
Social security Misc social security premiums 3,306,416 Pension contributions personnel 1,355,703 4,662,119
3,379,090 1,504,162 4,883,252
Depreciation of tangible fixed assets Other fixed assets 887,725 Profits on sale of tangible fixed assets -64,274 823,451
1,233,217 -18,408 1,214,809
(â‚Ź ) Revenues Net-sales
Other operating expenses Other operating expenses Housing expenses Travel expenses Office expenses General expenses
2,461,379 2,226,483 1,819,186 2,730,189 1,296,779 10,534,016
2,257,395 2,269,794 1,900,686 3,048,041 1,318,904 10,794,820
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34
Deerns Annual Report 2010
(â‚Ź )
2010
2009
Other operating expenses Hired capacity Other personnel expenses
1,597,712 863,667 2,461,379
895,119 1,362,276 2,257,395
Audit and other accounting fees Audit annual account 58,776 Tax advisory 86,622 145,398
45,747 48,960 94,707
Financial income and expense Interest and similar expenses -79,878
-61,151
Taxes on income Corporate income tax Deferred taxation Corporate income tax previous years Foreign income tax
868,553 -132,223 9,938 435,973 1,182,241
420,000 0 0 257,844 677,844
Income from participations in group and associated companies Profit/loss of P2B GmbH 79,311 Profit/loss of Deerns Naco B.V. 6,811 Profit/loss of Schmidt-Reuter GmbH 212 Profit/loss of Bouw Commissioning Nederland B.V. -5,207 Profit/loss of Yxion Deerns Pharma B.V. 0 Profit/loss of Deerns Spain SL 0 81,127
-100,390 22,781 0 -3,025 13,308 9,187 -58,139
Minority interests Minority interest in P2B GmbH -87,482 Minority interest in Schmidt-Reuter GmbH -258,025 -345,507
32,360 -206,348 -173,988
Other information Average number of employees During the year 2010 on average 446 employees were employed on the basis of a full time contract of service (2009: 432). Management salaries Management salaries
369,366
362,124
Growing beyond boundaries
35
Growing Deerns Annual beyond Report 2010 boundaries
36
‘From the beginning I’ve had every opportunity to grow’ Anke Matijssen / Manager at Airports Consulting Group I decided to join Deerns back in 2003. Previously I studied Aerospace Engineering in Delft (Netherlands), a study with an international scope. I wanted to use it in my professional career. I graduated in 2002, not particularly the best year to be involved in aviation with 9/11 having such a great impact. Deerns turned out to be the perfect address for my ambitions. And we certainly clicked. From the beginning I’ve had every opportunity to develop and today I have a most varied position. I am responsible for the results of the Airports Consulting Group, coaching and supporting colleagues and I am also in charge of acquisition. My best project? Definitely a completely new terminal in Gibraltar, right against the Spanish border, which of course is a great challenge in terms of logistics. I did it all. And it was great, having so much space.
Growing beyond boundaries
PART 3
Outlook 2011
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Deerns Annual Report 2010
Outlook 2011
Existing business preview The Deerns Group as a whole is in good shape. We budget a Group revenue level of € 49,984,000 and an EBIT of € 6,130,000 for next year. A new Business plan, looking ahead at 2011 – 2014, was finalised early 2011. Despite the difficulties of the last two years in The Netherlands, we have maintained strategic investments in training/education and in international development at adequate levels. By contrast, non-strategic investments (replacement of cars and laptops etc.) have been postponed in the Netherlands, causing an investment backlog that must be recovered in the coming year, along with, a.o., Group investments in a new ERP system. Business in the Netherlands is budgeted to show further recovery. Both German offices plan another fruitful year with business continuing at this year’s level or even better; Schmidt Reuter’s portfolio is already largely filled for 2011 and to an encouraging degree for 2012. Expected growth levels are modest: Schmidt Reuter grapples with a lack of qualified staff and a relatively small sales platform, and P2B too has to deal with limited management resources that can be dedicated to strategic business development. In 2011, we will nonetheless look into options of further developing our presence in the German market. In the United States, a net zero result is budgeted: as revenue is starting to pick up (after long proposal lead times), we will make further investments in business development, as well as in management and consulting staff, to strengthen our position – both in the Denver area and on the East Coast. Depending on the outcome of current leads in the Washington, DC area (data center practice), we may open a second US office in that part of the country. Generally, economic prospects in the US are not extremely inviting; however, we are confident that we will be able to carve out profitable niche positions, leading to positive outcomes in the years to come. Given our early and evident success in Paris, we expect Deerns France to follow an aggressive growth path in 2011. We have signals that the French real estate development market may be conducive to introducing innovations based on our proven
technologies in the Netherlands and Germany. Energy and design concepts that are very novel in the French market are readily visible in buildings that have already been built in our home markets. Our Paris office already boasts a sound energy and sustainability practice with distinctive qualities, and cooperation with other Deerns offices has already shown to be a powerful project acquisition tool.
New business development To further stimulate recovery in the Netherlands – where growth in traditional building segments will be lackluster for the years to come – we invest in the development of new ‘Product Market Combinations’ (PMC’s), as we already started to do in 2010. This year, first results were in the form of newly developed marketing contacts and first proposals in the area of tunnel design (with potentially large, though not extremely numerous projects in NL) and in the area of technical support of railroad maintenance (with a small initial project aimed at solving ‘rail switch heater’ problems). These and other new PMC initiatives will be continued in 2011, with prime responsibility put in the hands of line management, rather than as a Business Development support staff responsibility. In the German market, further steps in developing the novel data center business will be among the prime goals, and other innovation options will be developed both in Cologne and in Berlin. The Schmidt Reuter R&D Group’s premier position in energy conservation consulting will be rolled out to the extent possible in other markets. In 2010, we have developed a significant data center business volume in Russia. Here we will take cautious steps into other potentially profitable market segments (e.g., sustainable sports facilities), keeping a close watch on the various types of risks associated with these steps.
Growing beyond boundaries
39
‘The Deerns Group is in excellent condition’
New options for establishing offices will be explored in the United Kingdom (where a business entity was established late this year, to be ready for a large new client in England that may require us to have a local presence), and in Italy (where contacts exist with a building services firm in the North that could prove to be a fitting acquisition target). Embryonic contacts in India (data centers), Brazil (airports) and South-east Asia will be further explored in 2011.
Partnerships In 2010 we established ties with the Dutch engineering firm Witteveen & Bos, with whom we share a number of company culture features and who have a complementary business portfolio to ours. Next year we will further exploit the options of a structured cooperation. Another new potential strategic partner in The Netherlands is ‘Projectburo’ in Ede (NL), a smaller engineering consultancy focused on civil engineering and regional development. Our long-standing cooperation and close ties with Ecofys will be continued; the same holds for our Flemish partner, Ingenium of Bruges, with whom we fruitfully cooperate in a number of Belgian and Luxemburg projects. Probably our longest partnership is with NACO, Netherlands Airport Consultants. Though the formal ‘Deerns Naco BV’ joint entity had become outdated and was therefore dissolved, cooperation is as close as ever. Another long-standing partner, IF Technology, is a firm whose largest client we became in 2010. In the USA, we are strengthening ties with Kimley Horn (primarily civil engineering), and we enjoy the fruitful ties with RealNewEnergy. Likewise, in Russia we cooperate fruitfully and closely with our local representatives and project managers from Marecon BV. An attempted joint venture in China with Karsten Cleanroom Systems (dubbed DeernsKarsten, Sjanghai) unfortunately proved unsuccessful and was disbanded within six months.
As we believe that partnering with high-quality, complementary firms is beneficial to Deerns and to its clients, we are willing to invest in a solid relationship with these. Thus, partnerships will in 2011 too be an important element in our business.
Growing Deerns Annual beyond Report 2010 boundaries
40
‘New networks have levelled out the Chinese walls’ Aart Fransen (Partner) / Technical Manager at Mecanoo Today the classical column no longer appears in a fixed order at all times. Networks and alliances are becoming much more important. Usually you spend more time together during competitions, tenders and other ‘beauty contests’. This is also the case at an international level. With work, you create work. Once you have done an assignment somewhere, it usually means more assignments will follow. And that’s how you create new opportunities with each other and for each other. Provided you maintain relations that is. So, the market is witnessing a different dynamic which in fact developed slowly. It is much easier for parties to contact each other. You are constantly in search of the best team for a particular project. Which means that partners changes frequently. As long as you are open and honest about it you will be just fine. Both parties need the best combination considering the opportunities that are presenting themselves. You need a wide scope for that.
Growing beyond boundaries
PART 4
Personalia Management and Board of Directors Organisation Chart Memberships and Social contributions
41
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Deerns Annual Report 2010
Management and Board of Directors Board of Directors
Jan Karel Mak
Sjoerd Hora Siccama
Daan Eijgendaal
Erik Lousberg
Alex Jansen
Marcel Schellekens
Lars Mostert Germany, Schmidt Reuter
Barry Weisscher United States of America
Oliver Severini France
Hans Hamer United Arab Emirates
Bart Melis Spain
Ted van Loosbroek Nijmegen
Luciano dos Santos Amsterdam
Gerard Kluivingh Groningen
David Wesdorp Research, Building Physics & Energy Specialty Services
Countries
Christian Lohoff Germany, P2B
Locations in The Netherlands
Aad Bijl Maastricht
Erik Lousberg (a.i.) Eindhoven
Advisory and Expert Group Managers
Jan Willem van Rijen Health care Consulting Group
Wim Buters Laboratories, Industrial & Telecom Consulting Group
Anke Matijssen Airports Consulting Group
Daan Eijgendaal (a.i.) Building Exploitation & Management Specialty Services
Robin Sneeuw (a.i.) Finance
Ids Dijkstra Knowledge Management & ICT
Michiel Cleij Marketing & Corporate Communications
Support Staff
Jeanette Kool Human Resources Management
Daan Eijgendaal (a.i.) Building User Equipment Specialty Services
Xavier Crolla Public & Commercial Real Estate
Growing beyond boundaries
43
Organisation Chart
Deerns Groep BV
Governing Trust Foundation
Deerns NL Board
P2B GmbH (72%)
Schmidt Reuter I.P&B GmbH (65%)
Deerns Raadgevende Ingenieurs BV 12 Business Units Support Staff Groups
YD Pharma BV (50%)
Bouw Commissioning NL BV (50%)
Yxion BV (50%)
ZRI BV (50%)
Deerns America LLC
Deerns Espa単a SA
Deerns France SASU (67%)
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Deerns Annual Report 2010
Memberships and Social contributions
Deerns is a member of several relevant professional organisations in The Netherlands, Germany and the United States, such as NL-Ingenieurs and KIVI NIRIA (NL), Verband Beratender Ingenieure (VBI ), Ingenieurkammer-Bau NordrheinWestfalen (IK-Bau) and the American Council of Engineering Companies (ACEC). Among industry and scientific association memberships are BICSI and The Airport Consultants Council (ACC). Sustainability is an especially relevant topic with many organisations in which Deerns participates to help carve out innovations and policies towards a sustainable future. In The Netherlands, Deerns is a founding partner of the new employers’ organisation ‘De Groene Zaak’ (the ‘Green Business Association’), and of the Dutch Green Building Council. Deerns is also a member of VVM, the Dutch association of environmental professionals. In Germany, we are member of Deutsche G esellschaft fur Nachhaltiges Bauen (DGNB). In the United States, Deerns is a member of the US Green Building Council (USGBC).
In 2010 Deerns remained loyal to a number of charitable institutions it has sponsored for some time. We have again been a benefactor to a range of institutions and events in The Netherlands, such as: • the Prinses Christina Concours, a large classical music competition for young talents; • the Library for the Blind, headquartered in The Hague; • the four in hand horse driving team of Harry de Ruiter; • the International Koninklijke Holland Beker Rowing Regatta at the Bosbaan in Amsterdam; • the Delft University business incubator ‘YesDelft!’; • a number of PhD research projects.
‘Deerns is a founding member of the new employers’ organisation ‘De Groene Zaak’ (The Green Deal)’
Addresses
The Netherlands Nijmegen Toernooiveld 300 6525 EC Nijmegen PO Box 31269 6503 CG Nijmegen +31 (0)88 - 374 0230 nijmegen@deerns.nl Maastricht Adelbert van Scharnlaan 170b 6224 JX Maastricht +31 (0)88 - 374 0210 maastricht@deerns.nl Groningen De Deimten 11 9747 AV Groningen PO Box 1540 9701 BM Groningen +31 (0)88 - 374 0200 groningen@deerns.nl Eindhoven Klokgebouw 125 Strijp-S Terrein 5617 AB Eindhoven PO Box 1009 5602 BA Eindhoven +31 (0)88 - 374 0220 eindhoven@deerns.nl Amsterdam Constellation Building Stationsplein N-O 428 1117 CL Schiphol PO Box 75153 1070 AD Amsterdam +31 (0)88 - 374 0240 amsterdam@deerns.nl
Rijswijk Fleminglaan 10 2289 CP Rijswijk PO Box 1211 2280 CE Rijswijk +31 (0)88 - 374 0000 contact@deerns.nl www.deerns.nl
France
Germany
United States
Köln Graeffstraße 5 50823 Köln +49(0)221 - 574 1201 info@schmidtreuter.de www.schmidtreuter.de
Rockville 155 Gibbs Street Suite # 552 Rockville, Maryland (20850) 001(202) 340 8209 (mobiel) info@deernsamerica.com www.deernsamerica.com
Berlin Helmholtzstraße 2-9 10587 Berlin Stubenrauchstr. 16 D-14482 Potsdam +49(0)30 - 3980 1920 office@p2b-berlin.de www.p2b-berlin.de
Paris 164 bis, Av Charles de Gaulle 92200 Neuilly sur Seine 522 038 710 R.C.S. NANTERRE +33 (0)1 78 14 01 73 group@deerns.fr
Denver 3455 Ringsby Court Suite 104 Denver, Colorado (80216) +1 (720) 880 1820 +1 (303) 653 4181 (mobiel) info@deernsamerica.com www.deernsamerica.com
Spain United Arab Emirates Barcelona Paseo de Gracia 74, 2º-1ª A 08008 Barcelona +34 934 960 459 info@deerns.es www.deerns.es
Dubai PO Box 282664 Gold & Diamond Park +971 (0)4 341 80 80 info@deernsme.ae www.deernsme.ae
Deerns Fleminglaan 10 2289 CP Rijswijk P.O.box 1211 2280 CE Rijswijk +31 (0) 88 - 374 00 00 The Netherlands www.deerns.com