Boskalis Annual Report 2018

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EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. GENERAL Royal Boskalis Westminster N.V. is a leading global services provider operating in the dredging, dry and maritime infrastructure and maritime services sectors. Royal Boskalis Westminster N.V. (the ‘Company’) has its registered office in Sliedrecht, the Netherlands, and its head office is located at Rosmolenweg 20, 3356 LK in Papendrecht, the Netherlands. The Company is registered at the Chamber of Commerce under number 23008599 and is a publicly listed company on the Euronext Amsterdam. The consolidated financial statements of Royal Boskalis Westminster N.V. for 2018 include the Company and group companies (hereinafter referred to jointly as the ‘Group’ and individually as the ‘group companies’) and the interests of the Group in associates and entities over which it has joint control. The consolidated financial statements were prepared by the Board of Management and were signed on 6 March 2019. The financial statements for 2018 will be submitted for approval to the Annual General Meeting of Shareholders on 8 May 2019. 2. COMPLIANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS 2.1 COMPLIANCE STATEMENT The consolidated financial statements and the accompanying explanatory notes have been prepared in accordance with International Financial Reporting Standards, as adopted by the European Union (EU-IFRS), and with Part 9 of Book 2 of the Dutch Civil Code. 2.2 ADOPTED NEW STANDARDS The accounting principles applied to the valuation of assets and liabilities and the determination of results are the same as the valuation principles applied to consolidated financial statements in prior years, except for the relevant changes mentioned in section 2.3: Changes in Principles of Financial Reporting. 2.3 CHANGES IN PRINCIPLES OF FINANCIAL REPORTING The Group applied IFRS 9 and IFRS 15 for the first time. Both standards came into effect on 1 January 2018 and require to a certain extent a revision of the comparative figures, as explained below: IFRS 9 Financial Instruments IFRS 9 ‘Financial Instruments’ addresses the classification, measurement and recognition of financial assets and financial liabilities. This new standard replaces IAS 39. The introduction of IFRS 9 had no material impact on the results of the Group in the year under review and is not expected to materially impact results in future periods.

IFRS 15 Revenue from Contracts with Customers IFRS 15 ‘Revenue from Contracts with Customers’ provides a framework for the recognition of revenues and replaces IAS 18 ‘Revenue’ and IAS 11 ‘Construction Contracts’. The introduction of IFRS 15 had no material impact on the revenue and results of the Group and is not expected to do so in future periods. The impact of the adoption of these two standards is further explained and quantified in the Consolidated Statement of Profit or Loss, the Consolidated Statement of Financial Position and the disclosure in note 3.33. The following standards, amendments to standards and interpretations were not effective in 2018 and / or not yet adopted by the European Union. As a consequence, these new standards, amendments and interpretations have not been applied in these consolidated financial statements. The Group does not adopt these standards and interpretations early and the exact extent of the possible impact has not been determined. The most important consequences for the Group can be summarized as follows: of lease contracts. The standard was issued in January 2016 and will be effective as of 1 January 2019. This new standard relates to changes in accounting for operational lease commitments of the Group (see note 29). IFRS 16 requires lessees to recognize a liability in their Statement of Financial Position and to capitalize the right-of-use of a leased asset if it is leased for a period exceeding one year. The Group will apply this standard, as allowed by IFRS 16, retrospectively with the cumulative effect of initially applying IFRS 16 recognized as per 1 January 2019. Comparative figures 2018 will not be restated. During 2018 leases have been identified and preliminary calculations have been made. Based on our first assessment of these figures, we expect the total effect on the Consolidated Statement of Financial Position to be an increase of total assets and total liabilities between EUR 75 million and EUR 100 million, an increase of EBITDA to be between EUR 15 million and EUR 20 million and a decrease of the net Group result of less than EUR 1 million in 2019. As per the effective date there will be no impact on Group equity.  IFRIC 23 ‘Uncertainty over Income Tax Treatments’ was issued in June 2017 and will be effective as of 1 January 2019. The interpretation as included in IFRIC 23 is to be applied to the determination of taxable profit (taxable loss), tax bases, unused tax losses, unused tax credits and tax 2.4 NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED  IFRS 16 ‘Leases’ replaces the current standard for leases (IAS 17) and provides a new framework for the recognition

ANNUAL REPORT 2018 – BOSKALIS FINANCIAL STATEMENTS 2018 A UAL REP RT 2018 -- BOSKALIS FINANCIAL STATEMENTS 2018