Covid-19: Boskalis Stops Crew Changes, Cuts Spending

Dutch offshore transportation and dredging giant Boskalis has halted crew changes and will slash spending this year due to the COVID-19 virus crisis, it said on Thursday.

The company said that, while its workers work from home where possible, this is not an option for staff working on international projects and vessels.

"Therefore, as a consequence of global travel restrictions and to ensure the business continuity and health of our colleagues, the customary crew and project staff rotations have been suspended as of 16 March," Boskalis said.

Boskalis owns and operates a large fleet large fleets of specialized offshore vessels, including heavy transport vessels, multipurpose/cable laying vessels, fall pipe vessels, diving support vessels, oceangoing and anchor handling tugs.

"To date, precautionary measures taken by most countries have not resulted in a shut down of infrastructure projects and the import of goods vital for our projects is permitted. As a consequence, Boskalis has at large been successful in keeping its business activities operational around the world. This is only made possible through the impressive flexibility and commitment of our employees," Boskalis said.

Cost, Dividend Cuts

However, despite keeping its business activities operation, Boskalis has decided to introduce cost-cutting initiatives to preserve cash, and will slash its planned investments by 200 million euros.

"Several initiatives have been taken aimed at minimizing the non-project related out of pocket expenses, optimizing the working capital and halving the 2020 capital investment program to approximately EUR 200 million, including dry dockings," Boskalis said.

Boskalis' cash position at the end of the year 2019, was EUR 400 million with a positive net cash financial position of EUR 26 million. 

"The net financial position as per 1 April 2020 was slightly better than the cash position held at year-end and Boskalis has a financial headroom of more than EUR 950 million," Boskalis said.

Also, looking ahead, Boskalis said: "At present it is clear the COVID-19 crisis will have a negative impact on our business in 2020 but it is currently impossible to quantify this."

"Given this uncertainty and to preserve the strong financial position as much as possible Boskalis has decided not to schedule a dividend proposal over the financial year 2019 for the agenda of the Annual General Meeting of Shareholders (AGM) and to suspend its share buy-back program as of next week."