Boskalis Annual Report 2020

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STRATEGIC FRAMEWORK The Boskalis strategy is a logical progression from our purpose and mission: Purpose – We create and protect welfare and advance the energy transition. Mission – We strive to be the leading dredging and marine contracting experts, creating new horizons for all our stakeholders.

third-party services revenue. Here the emphasis lies on sustaining eet utilization levels whilst maintaining a responsible risk profile, with cost leadership being an important prerequisite. The S curve concept is dynamic in time and therefore we need to be critical with regard to the scope for adding sufficient value to assets at the lower end of the S curve. A structural shift in supply and demand can for example cause a former value-adding asset to be structurally repositioned lower on the curve. If this results in an asset becoming a commodity that cannot be moved up the S curve, we will consider divesting it. Conversely, modifying an existing asset or deploying it in a new market segment – for example in conjunction with our high-value contracting assets and project management capabilities – can result in it being repositioned higher on the curve. Boskalis manages its portfolio of assets actively in order to timely respond to such market dynamics. The essence of our value-adding asset concept is that we aim to position assets high on the S curve. Key achievements in 2020: ‚ Within the Offshore Energy division an interesting new market is currently developing: floating offshore wind. With our versatile heavy transport fleet, our seabed and subsea capabilities, large anchor handling vessels together with our project management and engineering skills, we are uniquely positioned to offer a one-stop-shop solution for this rapidly growing market. ‚ The BOKA Vanguard proved its value-adding potential again in 2020 by setting two new records. Firstly, weighing 91,000 tons the FPSO P70 was the heaviest cargo ever transported by ship. The FPSO was transported from China to Brazil. Furthermore, the BOKA Vanguard transported the largest cargo ever – a complete fish farm measuring 385 meters by 60 meters. This cargo was transported from China to Norway. Disciplined and selective tendering Market conditions are expected to remain challenging as surplus capacity still persists and clients continue to ask more value for money. This requires us to be disciplined and selective in the (pre) tender phase, focusing on projects that sit well within our profile of core competencies allowing for an equitable risk/reward (cash) balance. Key achievements in 2020: ‚ The outbreak of COVID-19 clearly had immediate implications for our clients and in general resulted in more protracted tender procedures. Nonetheless, we were able to increase the amount of work in the backlog from the record amount of EUR 4.7 billion at the end of 2019 to a new all-time high of EUR 5.3 billion. The focus of the tender team on the New Manila Airport project deserves a specific compliment which was rewarded with the contract award mid December. Capital allocation and returns Our capital allocation guideline aims to distribute and invest the company’s financial resources in ways that optimize returns. Safeguarding profitability margins also requires a continued focus on operational excellence whereby problem-solving capabilities, teamwork and leadership drive the ongoing improvement of our processes and practices.

The strategic course for the coming period is based on the following three pillars: Focus, Sustainable Growth and Human Excellence.

FOCUS Value-Adding Assets

Boskalis’ strength lies in deploying its own assets combined with additional interrelated core competencies to add value for our clients. Boskalis will sustain its success as long as we have the right assets and people to execute our specialized activities for our various client bases. We aim to achieve the optimum balance between margin maximization and eet utilization by operating our assets at various points on the S curve (see figure 2). We have clients who require us to deliver integrated, innovative services or turnkey solutions. In order to meet these client requirements, we need competencies that complement and reinforce each other, such as innovative engineering combined with financial and operational expertise. In addition, we need to be capable of acting as lead contractor with project management experience and a successful track record being of great importance. In this part of the market, with its higher margin potential, we expressly position ourselves towards the top of the S curve. Our more straightforward services and assets are positioned at the lower half of the S curve. Most of these assets also support our contracting projects but a large part of this business segment is

boskalis at a glance ANNUAL REPORT 2020 – BOSKALIS Added Value

ASSETS

Complexity

Figure 5: S curve - creating value with assests Figure 2: S curve – creating value with assets