Damen Shipyards’ order book rose to a company record of EUR 8.8 billion at the end of 2021. Part of that rise was due to the acquisition of an order for no fewer than 99 vessels at the Workboats division and a record number of orders for Damen Yachting. After three loss-making years, the Netherlands’ largest shipbuilder was back in the black in 2021.
Despite the various Covid-19 measures worldwide, the negative operating result (EUR 43 million negative) in 2020 was transformed into an operating profit of EUR 25 million last year.
‘2021 was a good year for us,’ explains CEO Arnout Damen. ‘We have delivered outstanding shipbuilding performance, for example with the complex diamond recovery vessel Benguela Gem, and we won the KNVTS Ship of the Year award 2021 for our electrically powered water buses for Copenhagen. Another great milestone in our efforts to become the world’s leading “green” and “connected” shipbuilder was when we built the world’s first full-electric harbour tug Sparky last year for the Port of Auckland and delivered eight ferries to three different clients in Canada, all fitted out with fully electric, hybrid or LNG propulsion systems.’
As for the outlook for 2022, the shipbuilder sees a number of uncertainties. Damen: ‘The crisis in Ukraine is having a major impact on our company. Not least on the 214 colleagues we had working at our Kherson and Mykolayiv sites before the invasion, with the tragic loss of one of those colleagues. Not only do we sympathise intensely with them, we have also worked as one to ensure that hundreds of Ukrainian employees, and their families and relatives, were evacuated to safer havens at our shipyards in Galati and Gdansk, but also in Amsterdam and Vlissingen, in recent months. Emergency supplies were taken to those who stayed behind. Many colleagues around the world contributed goods and funds, and provided refuge outside Ukraine.’
The conflict in Ukraine is also having a major impact in economic terms. ‘Within a week after the invasion, we decided to suspend the delivery of vessels that had been ordered and the signing of new contracts with Russian and Belarusian clients. Later, the Dutch government’s sanctions against Russia rendered those deliveries and contracts impossible. This year and next, we have been, and will be, hard at work on finding solutions for the vessels already under construction and on the associated legal procedures.’
‘Despite the consequences of this worrying conflict, we look to the future with optimism and confidence,’ Damen continues. ‘This is a view shared by our financial partners, who have recently confirmed their confidence with credit facilities for the years ahead.’
143 newbuild vessels
In total, Damen Shipyards Group completed 143 newbuild vessels in 2021. Exactly the same number as in 2020. The volume of repair and conversion orders dropped off slightly to 1100 (2020: 1300). The production volume did rise, from EUR 2 billion to 2.4 billion. EBITDA increased from EUR 87.5 million negative in 2020 to EUR 81.5 million positive last year.
The increase in the order book from EUR 8 to 8.8 billion underlines the good starting position for the future. The robust portfolio includes, in addition to a range of tugs, yachts, inland vessels, fishing vessels, barges and workboats, four F126 frigates for the German Navy, the Combat Support Ship Den Helder for the Royal Netherlands Navy, and the training vessel Ab Initio, which was fitted out for propulsion with green hydrogen, for the STC Group from Rotterdam.
Corporate Social Responsibility report
The 2021 Corporate Social Responsibility (CSR) report was published at almost the same time as the annual financial report. Since early 2020, Damen has been taking steps to implement an effective CSR strategy that is embedded throughout the company and aligned with its business strategy.
There are a number of reasons for the investments in CSR: ensuring that activities and solutions comply with regulations; serving clients and financial partners better; continuing to be an attractive employer; and protecting the company, the oceans and the world for generations to come.
In the report Damen says that the company is working hard to ensure it is a sustainable organisation with sustainable operations while it designs for sustainability as well. The shipbuilder adds that the proportion of orders that require sustainable considerations to be taken into account is growing rapidly as well as a result of the Paris agreement, the Fit For 55 initiative, IMO improvements and OECD guidelines.
‘I am proud that, in these hectic times, we have not put our corporate social responsibility ambitions on hold,’ says Damen. ‘And indeed, we have stepped on the pedal even harder. Moving up a gear in areas such as governance, sustainability, health & safety and supporting local communities. All this in the context of the UN Sustainable Development Goals, Fit for 55 and our own Framework for Sustainability developed on that basis. You will see that we have not yet reached our destination but that we are working hard to get there.’
Picture: The Copenhagen ferry was elected KNVTS Ship of the Year 2021. Damen is also nominated for the 2022 edition of this award with the Antarctic Supply and Research Vessel Nuyina.