Fugro N.V. (FUR) Earnings Call Transcript & Summary

Welcome, everybody. Welcome to Fugro's First Ever Investor Deep Dive Webinar. Why are we here today? My name is Catrien van Buttingha, Investor Relations. We are here today because we get a lot of questions from analysts and investors that are very interested in Fugro, but do not very well understand what it is that we do, what type of solutions we provide to our clients, which client questions we answer and which value we provide. Therefore, we have decided to organize this deep dive, and I'm really happy to be here with 2 subject experts within our company. First off, to introduce everybody around the table, Mark Heine, CEO; is the host of today. The subject matter experts, Frank Koopman, Global Director; and Leonard Sands, our Global Director, Land Site Characterization. So very briefly on today's agenda. After this short introduction, that will be held by Mark, Frank will present about 25 minutes or so. Thereafter, Leonard will present around 25 minutes again, and then there will be Q&A session, and we will try to answer your questions as best as we can. I would now like to hand over to Mark.

Thank you very much, Catrien. Also a warm welcome from me. It's great to actually have you all dialing in into this deep dive that we wanted to do, to talk really about the content of the business, what it is that Fugro really does. We -- yes, we normally don't have time for that in our investor call, so it's really good to do a deep dive and to zoom in into these businesses. Very distinct topics that we have on the Board. It will be clear that this is actually representing a large part of our business today. And therefore, I think very interesting to have these -- we are on the Board and also be able to ask questions about those. Yes, why does Fugro exist? As we all know, the earth, our planet is changing all the time. It's dynamic, continents are shifting. And that means that if you want to build something on this planet, yes, you need to understand the subsurface, you need to understand the environment and what the impact is on the risk of any project or any building project that is out there. And Fugro is the geo data specialist in the world. And yes, nowadays, we all see it in the news, the world is even changing faster than ever before. We are serving 3 distinct markets. That is the energy market, then the infrastructure market and also the water market, as we call it nowadays. And we see 3 trends there, very important trends. We read about a lot in the newspaper as well, the energy transition, obviously. And we have today, yes, the renewable part that Frank will be talking about. And then Leonard will talk about the 2 other topics, the sustainable infrastructure development, which is also really a trend in this market to build responsibly, also not hurting the environment nature inclusive as we call it. And then last but not least, the climate change adaptation work that is really required. That serves, obviously, these blocks in the middle, the net zero carbon emissions that we need to reduce in the world, the decarbonization, a big topic obviously, but also to enable a safe infrastructure, a resilient infrastructure and resilience to also the climate change that we face nowadays. All supported or, now the underlying themes there are the UN Sustainable Development Goals. These 5 are the ones that we really feel are close to Fugro and where we really make a positive impact on these UN Sustainable Development Goals. So 2 topics on the board for today. First of all, talk about winning in wind, Frank Koopman, our Global Director, Offshore Wind will speak about, yes, the renewable part of the energy transition. Offshore wind is now representing 25%, 1/4 of our revenues. It's a fast-growing market, and it's also a market that really asks for a lot of geo data and Fugro being that world leading geo-data specialist, this is very much tailored to Fugro. And therefore, we also feel that we are extremely well positioned. And Frank will point out that we already built over the last 25 years, this position and also built our market share, representing our services there in this market, in this key growing market. And the second topic that we have on the board is the geo risk management framework. Leonard Sands, will speak about that. The 2 markets that this is serving is the sustainable infrastructure or the infrastructure market and the water-related market together, 36% of our revenue. Also growth opportunities there, specifically because, yes, the world is changing, a lot of aging infrastructure as well and also with the physical risk that we see coming in from climate change, this is really important. And Leonard will speak about the opportunities we have, the large opportunities in the projects that are out there in the world and specifically how we deploy our yes, really advanced technological solutions that we have now developed over the last couple of years. So I think, a fantastic program. We'll dive into the details there. And we first start with Frank Koopman, winning in wind. And let's do that first. And then after the 2 presentations, there is time for questions.

Hello. My name is Frank Koopman. And today, I'm going to talk to you about the very exciting topic of offshore wind. Offshore wind is a source of renewable energy, and the world needs affordable renewable energy. So we are very proud to contribute to more than 50% of the offshore wind farms globally. In my presentation today, I'm going to talk to you about how we got to this position and talking a little bit about our history, but also about our services that we provide at a high level, some of the market trends that we see and some of the opportunities that we see for Fugro in this market. I'm going to start with this picture. This is actually a picture of the first offshore wind farm project that we've ever involved in. It's the third offshore wind farm project ever built, and it's a project in Sweden. For this project, we drilled 5 geotechnical bores and the geo-data that we collected for this project fitted on 1 floppy disk. Since then, offshore wind has dramatically increased in scale and in complexity. And if you take a look at the site of the first wind farm project, you see here is the site, it's about 0.25 square kilometer in size, and the turbine -- the installed capacity was 3.3 megawatt. Now you see some wind farm projects being planned around this site. They're about 1,000x bigger and one of them is, for instance, 1.5 gigawatts, so a multitude bigger. If you take a look at the North Sea, all of these wind farm sites, all of these sites will be planned for offshore wind. And you see the same happening on the East Coast of the America -- of the United States, for instance, so you see Canada but also in Colombia and Brazil a bit further down. And you see it actually happening all around the world currently. And so Asia, in this case, you see a picture here of South Korea and Taiwan, but it's also happening in Australia and Japan, for instance. So offshore wind is really picking up scale at a global basis. If you then take a look at the numbers here, and I brought 2 graphs for you today. On the left side, you see the total amount of investments. This graph has been relatively flat from the beginning, 25 years ago. And now you see in the recent years, you see exponential growth happening here. And you see really serious money being poured into offshore wind, as it's past the tipping point of being an affordable source of renewable energy. And you see exponential growth, and these are billions of investments per year that are flowing into this market. It has some effects here, because if you see here, you take a look at this year, 2022, we currently have an installed capacity of about 42 gigawatts globally. By 2030, that number is expected to increase to 210 gigawatts. So it's 5x the amount of capacity currently installed. So really gigantic growth. Now what are the challenges related to that? I'm going to tell you a little bit about what it means to develop an offshore wind farm project. It's actually quite a repetitive problem. And there's always key components that need to be installed. And if you take a look at this graph, you see here the main components of an offshore wind farm. So you see always the turbines on their foundations, array cables connecting the turbines to the offshore substation. And from the offshore substation, there's an export cable to the onshore substation, which is connected to the transmission network and ultimately, our homes. If you take a look at the investment components of offshore wind farm project, the biggest investment is the turbine itself. Now the turbine comes out of the factory. So there's not a lot of geo-data, site-specific data needed for that. But on the other hand, there's also the foundations that need to be designed, the cables that need to be routed and trenched, the substation needs a foundation, and there needs to be a design made even before you can submit a business case or a submission to win the acreage. So a lot of these components are extremely geo-data heavy. And that is where Fugro comes in. So on the next slide, I'm going to talk to you a little bit about our offering and also later down the line a little bit about the opportunities that we see. But first of all, I'm going to zoom into a little bit more detail on the individual components and what growth do we see in that, so we can give you a little bit of a picture. On this graph, you see the total amount of square kilometers that need to be served, that need to be developed over the next couple of years. So you see an insane amount of growth there, and this is being driven by the sites becoming bigger and bigger. You see also that the amount of cables that need to be installed is growing dramatically. The wind farms are currently being built farther from shore. The turbines are getting bigger. So the distance between the turbines is increasing, triggering a huge need for geotechnical and geophysical and other data needed to route these tables. And last but definitely not least, also we see the amount of turbines growing. And also the foundations are becoming more of them, but also becoming more complex when we move into deeper water and to deeper turbines. And on my next slide, I'm going to zoom in a little bit to this last picture. Here you see some of the typical foundation types in offshore wind. Most of the foundations, most of the turbines are currently being installed on monopiles. And they are -- they look like a simple foundation, but they're actually quite complex. They can have a diameter of up to 10 meters, and they're individually designed for every location because every location is different and they're optimized. Half of the steel of such a foundation, of such a turbine is actually in the soil. So it's very important to optimize the design of the foundation. When you move into deeper waters and beyond 50 meters, monopiles are not economically anymore. So then we move to structures like this, for instance, jackets. And you see there the amount of units being installed. It's quite a dramatic number that needs to be installed over the next couple of years until 2030. Jackets also take us to a certain point to say, approximately 70 meters and they are not economical anymore and then we moved to floating construction. And they can range from 70 meters up to we see also in some projects at 1,300 meters nowadays. Floating is a whole other game. These areas are much larger, but also there's much more touch points with the soil. So a floating foundation typically has 3 or 6 anchors. So quite a lot of geo-data is needed to develop these floating foundations as well. And these are just examples. Also, the offshore substations need foundations, and we see also a trend towards energy islands that need foundations as well. And so it's actually quite a lot of site-specific information that is needed to develop these. Then looking a little bit at a high level to this market. What are some of the market challenges that we see? The first challenge is obviously the increase in scale. And so these projects are extremely complex. They're built in complex and harsh environments, offshore, where there's a lot of wind and the billion euros or dollars, if you like, investments. There's a pressure to reduce costs. And our clients sell electricity. So the further they can reduce the cost of their development and optimize their design the more money they basically make. So it's really an important element also to further reduce the cost of renewable energy. Another element is time. And so a lot of the investments are upfront and the wind is for free. So the earlier the turbine can produce electricity, the better it is for the wind farm under development. And a lot of the times, we are on the critical path. So the data that we gather is needed to come up with the design and for the -- and come up with it and develop. So we help our clients to accelerate this time frame significantly. And last but not least, definitely not the least, we need to reduce risk. And there's all kinds of risks related to these offshore wind farm projects, things like, for instance, environmental risks can be, use the full site or environmentally sensitive areas around bird migration patterns. But also some of the countries are still figuring out the legislative framework. And so there's also a risk of not getting the permits in time. And so there is, on one hand, a threat for us because a project might move to the right if the permits are not in place, but also it's an opportunity because in a lot of cases, we help our clients to get the permits and we are very close to regulators. For instance, in the Americas, we help our clients significantly to accelerate their permit schedule and to derisk a site. So what are some of the client questions that we see and what does the client need to know about the sites to develop this wind farm successfully? Well, we see a couple of questions that always pop up. Obvious one, is what is the wind's revenue potential? How much electricity can I generate at this particular site? Another important question is can we use the full site or are there geohazards at the site? What is the optimal cable route? Are there environmentally sensitive areas or rock outcrops that I need to avoid? Which landfalls can I use? What is the optimal foundation design? Obviously, a lot of steel into the foundation. So optimizing the design is very critical to reduce the CapEx. How do I reduce the risk of unexploded bombs at the site? A lot of these sites are located in areas where there have been wars in the past. So we need to find if there's any risk and derisk the chance of hitting a live ordnance. Then further down the line, when we've designed the foundation, and if we designed the site, I should say, then the questions come up in terms of the installation. So how can I optimally install the pile and the pile need to be extremely vertical. And so how can we make sure that is at the right location and in the right alignment. After the installation, are my cables sufficiently buried. And there's current at the site. So the settlement moves and the cables can get unburied and when they're unburied they can get damaged. If there's scour, what are my foundations, for instance, if the foundation gets scoured away, then the whole foundation gets impaired. So some of the data that is needed to answer these questions is the data that we provide. And just to give you a glimpse of the data at a very high level, we typically start with consulting. And so we have got a lot of geologists and a big database of data from all around the world, and we sit with our clients to understand the risks at that specific site. We typically deploy mid-ocean buoy quite early in the process, so measuring wind data but also wave and current data that is needed for the input of the design. Without any boots on the ground, we make use of satellite remote sensing data, the LiDAR data to measure the water depth in shallow water for instance. Geophysics, also a very crucial element for the design of the site. And so we see if there's any objects on the sea floor, and we also see what soil layers are there below the sea floor. Are there any buried bombs, are there any geohazards at the site? Biodiversity and ecology, extremely important because they are fundamental to getting the permits in place. And there are also a key criteria to be able to win the acreage in the first place, understanding the biodiversity and ecology. Geotechnics, obviously, to be able to design foundations, like the right foundation concepts and including laboratory data. So quite advanced data tests that we do on these samples, for instance, to understand the degradation of the soil strength due to cyclic loading. Unexploded ordnance detection, I've already explained, we need to do that. And so there are many more things that we need to do. Also when the installation is fully installed, physical inspection, for instance, of the cable protection system, the anodes of the foundations and also cable detection to see if the cables are still sufficiently buried. So there's a lot of geo-data that is needed for an offshore wind farm project, and we provide that data. We are obviously not the only ones that provide that data. So I'm also going to talk to you a little bit about where do we fit and how do we compare to some of the other players in the market. So here you see a table and on the table on the top, you see the different types of geo-data that are needed to develop an offshore wind farm. And you see here, Fugro. And so Fugro provides all of that geo-data. So we can -- most of our clients, they see us as an integrated service provider. So we are a one-stop shop for geo-data for wind farms. You see our competitors. We've got a couple of global competitors that provide on a global basis, a specific surface. We also have a couple of semi global competitors that provide some of these services and a little bit more of these services, but they're not fully global. So we have quite a special place in this market, I would say. And our clients like that. And you can see that, for instance, in our market share, here in this case, geophysics and geotechnics from a report by Rystad that recently released, you can see that we have quite a big chunk of the markets and our clients come to us for these services. I'm going to talk to you a little bit about what we actually provide for these clients in a little bit more detail. And I've got 3 solution examples that I have got with me today to run you through. First, the site appraisal and concept design, everything we do, [indiscernible] power cable design and foundation design. Starting with site appraisal and concept design. And so when we get to the first -- when we get to site first, there's nothing there and so we're mapping the site. And typically, we start by mapping the mid-ocean conditions. And what -- this is actually a picture of our geophysical vessel. Also we bring that in quite soon to map the site and see if there's any objects on the seabed that we need to know to understand the stratigraphy and the geology. And we also supplement that with geotechnical and in this case, environmental data. So getting a full picture of the site and creating a digital twin of the site that is used as input for the design. Nowadays, also we use modern technologies like satellite imaging, but also uncrewed vessels and to also further reduce our carbon footprint to gather this data. All of this data gets collected and gets provided to a client. And that client typically works in a design team at multiple locations. And they need to share this information also with regulators. And so I took 1 product example from this solution in the next slide to give you a bit of a view on what our clients see. And this is actually some of the screenshots of our digital delivery platform. So you see here some satellite data, some geotechnical data, some geophysical data. And our clients are able to interact with this data, subsample it and use that as input to their design. They can also share with their subcontractors, but also with regulatory bodies to be able to get the design as efficient, but also as short as possible. And so our clients really like this concept, and we only quite recently deployed this on many of our projects. Moving on. And so a little bit further in the design cycle. The concept design has been developed. Let's say, a client has won the concession and now needs to develop the detailed design. And so in this case, the power cable design. The power cable needs to be routed and also our clients faces challenges to order this cable as soon as possible. The current supply chain is under a lot of pressure. So our clients need to get insights of the suitable route ASAP, I would say. And what we do there is, we get a geophysical data, but also geotechnical data as input to the trenching and then the routing of the cable. We see if there's any buried boulders in detail, so areas that we need to avoid. But also, we need to understand the thermal conductivity of the soil. And so our clients bury these cables to make sure that they don't get damaged but the cables themselves heat up when they transport electricity. So the soil needs to be able to take that heat away from the cable to make sure that the cable doesn't overheat and fail. And so understanding the thermal conductivity is more and more important when more electricity gets transported. So we provide all of this data to our clients. And I just took with the 1 example on where this data comes together. And that's actually an example of the digital platform that we have and some consultancy tools that we run on the platform ourselves or our clients can also run these tools. And that is what we call Gaia.Route. So that's an assisted route planning and optimization package that we provide to our clients. And in this case, what you see happening behind me is in the real-life example of an offshore wind farm project in Brazil, where the client is routing their cable to shore in a very complex environment with a lot of existing infrastructure and environmentally sensitive areas where the cable cannot be routed through. So how to bring the electricity from A to be at the most efficient routing. That's the key question here. And how this technology works, that it takes into account the geo-data, but also the asset-specific data, like, for instance, minimum cable radius. And the software helps our clients to route the cable in an efficient but also in a reliable way. Then I was talking a bit earlier in my presentation about the foundations. It's a key element of the design. And we also have a fully integrated design solution for foundations where we typically gather the information by either using a drilling vessel or a seabed vessel. So drilling is a technology that takes in situ tests and maybe just for -- just to be 100% clear, we don't drill deeper. It's purely for the foundation. So it's not that we're drilling for oil or anything but drilling here to take geotechnical -- to get the geotechnical data, and we take in situ tests and also we take undisturbed soil samples. These soil samples are taken to a laboratory and we'd be deriving all kinds of geotechnical parameters that will be used ultimately to optimize the design. Also, we gather the data using in situ tests. So in this case, we push a rod with a pretty sensitive sensor at the tip into the soil to measure the soil characteristics to foundation depth. So we've got some priority -- proprietary technology there in place also to be able to do this efficiently. And that's what I'm going to show you in the next slide. So here, you see some of the technology that we've developed. And this is the technology that we've been improving over the years, and we've got now patents in place, and this was especially developed for offshore wind because offshore wind is characterized by very complex locations and a lot of them as well. And so you see here technology that is suitable for very accurate measurements. So the penetration speed is extremely constant and also, we have a patented technology to push the rod deeper into the soil. So everything you can do with in situ pushing, you don't need to bring a drilling vessel to site. And in this case, you see here that we have got -- we introduced a friction reduction fluid to be able to push the sensor deeper into the soil, enabling our clients to get high-quality data to remote sites, to the depth of the foundations. Now I'm going to end my part of my presentation about the content vis-a-vis real project example. In this case, in a project offshore New Jersey, it's wind farm developed by our client that needs to develop a wind farm of 285 square kilometers in the water, that's between 90 and 37 meters. It's about 28 kilometers from shore and our client wants to deploy 50-megawatt turbines at the sites and hundreds of them. Just to give you a bit of an indication, the rotor diameter of these turbines is 236 meters. So that is the swept area of more than 6 football pitches. So they are really gigantic structures that need to be installed. And also, there's quite a lot of cables that need to be installed. So 440 kilometers of cables and 2 export cables of 40 kilometers that you need. So we gather a huge amount of geo-data for -- on this site. So we -- geophysical data, geotechnical data, 290 locations that we're testing, ecological sampling and also laboratory testing related to that. In total, we gathered about 300 terabytes of geo data to develop this wind farm site. And our client really like the way we do that. And so they get from us a fully integrated solution. And so we provide them all the data. We provide the data digitally. So they get high-quality data and also they get their insights early which enables them to accelerate their project schedule but also significantly reduce their risk. And I've got a quote here from Deanne Hargrave, who's the Geoscience Manager, responsible for all the geo data at this site. And she's -- this is a quote about our geo-data platform that I've showed earlier. She says that this is really the point of contact for all of the geo-date at the site, not only during the construction phase, but also during the later phases. And she's very happy. She actually has -- I did a webinar with her where she explained how they use it. They have got about close to 1,000 individual users on the platform in their own design teams at various locations, but also and the regulator and the subcontractors. So a lot of people have access to the data in real time. And we upload the data to the site as we acquire it. So we're a very happy client, I would say. Then some future developments. So obviously, we have currently a very strong position, but we see many opportunities also for further growth. We had mentioned already growth in digital delivery and our digital delivery platforms. But also we have been digitizing our workflow significantly to standardize and to make them more efficient and faster. We are on a transition to net zero. And most of our clients but also our employees and other stakeholders they find this more and more important and including ourselves, obviously. And so we have a clear road map in place to become less carbon-intense and one of the examples how we do that is to use uncrewed vessels. Also we're converting some of our specialized survey vessels, for instance to e-methanol at the moment. In the market, we see great opportunities in floating wind, energy islands, carbon capture usage and storage that sometimes can be a hybrid with wind because the site can be of dual use. And also we see hydrogen is a big growth market. So we see already some technologies, for instance, for pipelines that we can use in that market as well. And we see a lot of link between offshore wind and green hydrogen generation going forward. In terms of the phases of the life cycle, we are currently very active in planning and design. So we have a very strong position there. We're also very active in installation support, and so we don't install anything ourselves, but we provide for instance, positioning services there. So we've got a strong position there. And we see also great opportunities on operations and maintenance, and some of the inspection services that I showed you earlier. And so if you take a look at our current position, we're quite strong there, but we also see many opportunities in this part of the life cycle. And that is currently maturing with the increase in scale in the industry. So there's big opportunities for us. So this is my last slide. So just a couple of key takeaways. So obviously, this is a market with a very high growth with some challenges and whether we can help our clients to deal with the growth of these sites. The markets are very geo-data heavy, and we think that we're going more and more geo-data heavy over time. So also, it's not only absolute growth but also the need for our services is increasing significantly. And we are very strongly positioned. So we have the technology, we have the people, we have the client connection. So we are in a very good spot to continue to contribute to affordable renewable energy going forward, and we are ready for the future in that sense. Thank you very much.

Thank you very much, Frank. Very, very interesting and I think quite complete presentation. Mark, do you have some first observations before we go on to Leonard's presentation?

Well, first and foremost, Frank, thank you very much for this great insight. I think it was well presented. Despite the fact that we're 25 years in this market, it's still a relatively immature market that provides enormous amount of growth opportunities. I think for Fugro, you have presented that extremely well. What is also nice to see is that the technology that you presented actually also comes back in our land business. And I spoke about a land before and especially the infrastructure market and the water market that now represents 36% of our business. So it's good to maybe step over now to the land element and let Leonard to present on our geo-risk management framework, which is also in the market that is growing and provides wonderful opportunities for Fugro. And then after that, we'll open up for questions. So over to Leonard.

Hello, and welcome to our Investor Deep Dive on to our land business. I'm Leonard Sands, and I'm honored to talk to you today about our land business and how we operate in the world of Fugro. Today, I'll be taking you through a journey, which will look at the markets and will actually how we see those markets shaping up in the future and how we operate in those markets to deliver a difference that actually creates value for our clients and for growth. So taking on our first journey, we take -- we give you a statement which is quite profound, and it actually shapes the magnitude of what we operate in this market. There will be more infrastructure built in the next 40 years than there has been in the last 4,000 years. And that creates a significance that this market that we operate in is one of the biggest world markets that are existing today. In fact, we see the construction sector totals around EUR 2.4 trillion a year and within that sector, we actually are operating in the construction services market. That construction services market by 2026 will be in the order of EUR 600 billion a year. So you get an appreciation of the size of the opportunity that Fugro has in land. Within the services sector, we actually represent more or less 1% to 1.5% of construction spend. And that equates to approximately EUR 6 million to EUR 9 million per year in addressable market. And where we see the opportunity in that addressable market is in the large infrastructure projects. And we have mapped many large infrastructure projects for the next more or less 10 years, and we see many of them across many of our markets. In fact, in total, more than 450 large infrastructure projects appear in the next 10 years. And they appear in Americas, they appear in Europe, they appear in the Middle East and also Asia Pac, where we see Fugro delivering a differentiating solution through technology and expertise. So regularly we get asked by clients, what are the key challenges that they have. And I can take you on a journey in this case here with a rail line, a high-speed rail line. And in fact, one of the key challenges that many of these high-speed rail line constructions encounter is the limiting speed, which is encountered because of the soil. And you may think that this is probably not a significant issue. But in fact, once these high-speed trains get to their optimal speed, there is a resonance that occurs between the soil and the track. And if that resonance isn't identified and treated with the right construction measures, this track becomes unstable. And Fugro is able to identify this through the entire route where these systems play an critical role in the operation of the train. We're able to identify them, characterize them and then analyze them to determine what is the best measure to treat those soils so that the train can run safely across the segment. Other issues that actually pop up with clients' challenges are those to do with vegetation. How does the vegetation encroach on the rail corridor? And in fact, this changes over time and season, and we're able to answer and predict what would be the vegetation in certain times of the year so that the maintenance can plan to remove the vegetation so it doesn't impact the operation of the rail. We also have clients in the coastal zone. And with the climate change agenda, raising sea levels and creating extreme flood events or extreme storm events, we get clients asking questions about the sea level rise. If there was a sea level rise of 2 meters, will it impact the adjacent livelihoods. And what we're able to do is acquire data, analyze the data and determine if that water level from the sea is going to overtop any barriers for instance, levees or rock walls and determine if that water is going to then impact the livelihoods on the other side of the seawall or the barrier. We're also able to answer and address, will the structure that's holding back that water actually be resilient enough? Will it actually be optimal in the years to come? And many of these infrastructure projects along the coastal zone are built for long periods, built for 100-year events where they're able to actually protect the livelihoods, which are behind them. So let's look at some of the market challenges that occur in our clients' world and also what Fugro encounters. And they range from frequent cost project overruns, aging infrastructure that basically that infrastructure is getting to the point where it's actually at its design life. And that design life then impacts the actual usability and when you have to replace it or you have to actually retrofit that infrastructure. There is also an increasing societal demand to address the climate change agenda. And that occurs in legislation where, for instance, in the Netherlands, you see the nitrogen law really impacting the influence on decisions in infrastructure. And in other markets where you see climate change agenda becoming a social echo where companies like Fugro have to actually show that we're actually meeting those challenges. But there's also uncertainty from the macro and geopolitical environment. That actually determines where the spending is done, but also when the spending is done. And events like COVID or events in the Ukraine impact the timing of and also the magnitude of spend in infrastructure. So keeping these market challenges in mind, we're able to apply an agile and effective differentiating solutions that actually meet the best needs for clients and also for Fugro. So the future is different, and we see it in different in many ways because urbanization is driving a large increase in large infrastructure projects. And these infrastructure projects actually have a challenge at hand. And the challenge at hand typically comes in the form of time overrun, 40% of the schedules are usually over in delays. And there's also project cost overruns in the order of 30%. So this creates an opportunity where there is actually a need and this need is then serviced by creating differentiating technologies that can accelerate the programs and then pass on that benefit to the clients to move forward with their development. But also reduce uncertainty earlier in the program so that they are able to actually make informed decisions at a stage where the project is critical and allows them the visibility on the next phases as it progresses through the project. But also there is a scale and a need to actually meet agility in these projects. Moving around the world, you don't see all of these large projects appearing in each country every year. You see the large projects moving around to different countries where the spend and the timing is right for that country. So it requires Fugro to be agile in servicing that need where it's needed. But there's also the -- we see a differentiation where Fugro and the leader of geo-data can actually provide that differentiation, that ability to actually save time and also lower the uncertainty earlier in the project cycle. So with Fugro, we have a philosophy where we look at the market and we actually see how the development of these projects occur. And they occur in 6 stages, ultimately from the early stages of site screening or what you would call feasibility, all of the way through to asset operation. But in the site screening phases where the biggest impact can occur with reducing the uncertainty to these large projects. And we are able to use technologies, new technologies that can scan the ground to actually identify anomalies. What does that do? It informs us where to actually drill to the best anomaly to take samples and characterize that type of the ground to allow better informed design through data analytics. We're also able to actually apply our data analytics to then scenario build, identify what is the most optimal design for that infrastructure, then supporting through to recommendations on the construction cycles, where we calibrate the designs in situ, giving the clients the optimal solution as they move forward in the growth of that project. And through later, we see the construction where geomonitoring plays a role where the clients need to understand what is the impact of their construction on the adjacent infrastructure. And that's critical when you're actually in an urbanized environment to understand what is that role between the active and the passive infrastructure. And later on when the asset is delivered, this is the important phase of actually turning on the asset and actually finding out what is the health of the asset through its entire life. And that is a critical phase because it represents the most time in which the asset is present. And we're able to inform through data analytics, what is the best procedures for actually keeping that asset safe and healthy. So going into a bit more detail and taking that geo-risk framework, we are actually breaking it down now into the 5 cycles in which we mentioned before, which was the feasibility, we go through into design phases, construction and then the asset operation. And effectively, what Fugro does is participate in the whole life cycle. That's actually our benefit. And that life cycle actually starts where we provide a solution. We actually work with the clients to reduce the uncertainty. So they have these challenges, whether they might be the rail line on the soil, but we determine where are the parts of that rail line that are sensitive with soils and the speed of the train. And by doing so, we can reduce the uncertainty for them to move to the next phase and so forth as it goes into construction, then ultimately into asset operation. In each phase of that derisk management framework, we're delivering a differentiation, a solution that effectively creates the value for the clients. Now in our advanced technologies, we are actually applying a different approach where this advanced technology is able to show a greater value by lowering the uncertainty even earlier, perhaps in the feasibility phase, but also accelerating the time program. So then the clients can move forward with the benefit of the time which is, of course, value to them and of course, earlier insights with the lowering of uncertainty. So what are the typical land large projects that we encounter across the globe? At the moment, we see a lot of demand from energy. That energy projects occur in the form of downstream or gas projects, for instance, gasification or regasification projects in the U.S.A. are quite common at the moment, and that's causing a significant demand for those developments. But we also see infrastructure in cities and tunnels, for instance, NEOM. We're participating in NEOM in Saudi Arabia to deliver very complex project on a very tight schedule. But we also see rail projects, for instance, HS2 in the U.K. is a project we're active on where we're delivering site acquisition and actually advice on certain parts of HS2. And likewise, in water, we also see a significant role where Fugro is playing actively. And it -- for example, in the recent Florida hurricane event, we were within 24 hours on-site flying and scanning the coastline for impacts of where this event actually damaged infrastructure or changed the coastline. And that insight allowed the owners or the governments to then act and start to give a response to where help was needed. And likewise, in the coastal resilience, for instance, in the Texas spine of the Southern Coast of Texas, we're actually looking to work on that project to see how we can participate and help inform what is the best barrier to protect the livelihoods on that coastline. So when we look at the market and how Fugro is positioned in the land business in this market, we note that it's very fragmented. There's a lot of small local players that provide standard solutions. And there is actually very few large companies like Fugro, who are actually globally spread or regionally spread and actually have a differentiating technology. So where we see the sweet spot for Fugro in the large infrastructure projects is in that zone where we have the differentiating technology, but we also have the geographic footprint where we can team up with large engineering firms and deliver a combined solution that actually truly generates value for clients. So let me take you through on 2 case studies, give you some insights on what Fugro is actually doing today. And this first case study is really an interesting case study, which goes into the areas of geo-data, which a lot of people may not appreciate. It's in San Francisco, and it's the seawall along San Francisco. In this project, Fugro has been responsible for leading the contract with Jacobs and actually determining what would be the best retrofit solution for the seawall. Now you can see in this graphic here, the yellow zone is an area where, in fact, the San Francisco is being built on uncontrolled material. That uncontrolled material is not good when it comes to sea level rise nor is it good when it comes to earthquake movement. But there is also the risk of the aging infrastructure. That Seawall has been there for quite some time. It's in a decaying moment where it's actually critical to actually protecting the livelihoods behind it. Overall, 100 billion assets at risk behind that seawall with an economy depending on 24 million people that's passing through the city and related to that seawall per year. They seek to actually look for a 100-year risk horizon, and that means within that 100 years, what are the likelihoods of an earthquake, what are the likelihoods of the sea level rise. And what we're able to do is actually use a AAA approach, and that's the acquisition, the analysis and the advice to actually provide a differentiating solution that the client can actually meet their budgets and move on to actually create a safe and livable environment for their citizens. So Fugro was involved in the acquisition stage where we looked at high-quality data along that seawall, we then use that data to apply analysis and understand where is the most critical parts of the seawall that need treatment first. Now that actually allows the client to schedule their budgeting over multiple years of retrofitting and then move to the next phase of then what do you do in the construction? How do you actually avoid the disruption to the associated economy? So what we're able to do and beyond the analysis is then advice to the clients, where along there, would you have to actually apply a marine approach to construction versus a land approach and thereby enable the associated economy to continue. So the client was extremely satisfied with our work. They identified the solutions that we came in the project were of extreme value to their benefit. And they seek to actually continue our involvement even today through the retrofitting stages of the project. The next case study is an interesting Middle Eastern city where this city is actually founded on some material, which is actually not really good for infiltration. That means the water from flooding and rainfall is not able to penetrate into the ground effectively like many other countries or soil types. So what ends up happening is this city actually experiences a lot of disruption from cloud burst rainfall. And that disruption impacts -- damages infrastructure, but also creates a reputation problem for the government. And what we've been doing is and being involved in identifying the areas at which we can effectively advise -- identify and advise on effective infiltration with storm water drainage. And we've done this through our advanced technologies where we've scanned the ground, identified the anomalies and then determined what are the characteristics of those anomalies to inform design and construction best practice. And this is our SWANS 3D site screening solution, where it's an ability to actually scan the ground, somewhat similar to an MRI, but using sound waves. And this is able to actually map the subsurface and in 3-dimensional and actually see where the critical changes in the subsurface that would actually impact the infrastructure construction. And by doing so, that basically eliminates the amount of intrusive work or perhaps the biopsies if it was in the medical industry, minimizing that to the actual critical areas that you need to identify and characterize. And with that combination, we're able to actually deliver a confidence to the client, but we're also able to deliver an acceleration to their programs by spotting things in the ground much earlier. Our client, Andres Pinto, was extremely satisfied with the work that we've done on this project. And in fact, they're looking to actually take this into Stantec and grow it globally with us together where we seek to actually team up and deliver large infrastructure projects globally. So what are our future developments? This is an area where we see great opportunity in a significant market. It's a market that is actually well beyond actually where we are today. And we can grow quite much -- a lot more than the actual standard market growth rate of 8%. And we will seek to do that by globalizing our site characterization technologies like SWANS and moving in an agile way to work closely with international contractors and consultants to spot these large infrastructure projects, which are challenged by the complexity and need for time acceleration. So, key couple of takeaways for you to consider. One is the complex complexity of infrastructure development, what we see ahead of us in the large infrastructure projects, the scale in which they cover geography. And also the time in which they seek to deliver these projects is often very challenging. There is also a need to support inventory through climate change adoption. And Fugro's role is to actually provide technologies and solutions, which can actually reduce the CO2 footprint in many of the designs or even the actual activities and site characterization. And we do this through differentiating advanced technologies where we're able to do battery-operated remote operations. Now we're able to actually just screen the site unintrusively to then get informed in sites and then optimize the next phases thereafter. So thank you for the opportunity. Truly appreciate it, and we look forward to actually working with you later today.

Thank you, Leonard, for your very interesting presentation. You will have noticed that we had a little bit of a mishap after the movie. The screen just kind of froze for a little while. So there were 2 slides that Leonard presented, and you did not see them in your screen. So there are 2 observations I would like to make. One is that we will post all the slides of the presentation on our website. It will take some time, but I think tomorrow morning at the latest, so you will have the full slide set. That is one. And the other is that during the Q&A presentation, we can maybe still ask Leonard to present those slides when we can pull them back. But first, before we get to the Q&A session, I'd just like to repeat what you now see in your screen: how can you participate in this Q&A session. You can type in your question in the screen. To get to the correct screen, you will need to click on the question mark button. If you do not see that one, what you need to do is make sure that your screen is off the full-screen mode. I hope I explained this clearly for everyone. But via that screen with a question mark, you can type in your question. So whilst we wait for, hopefully, your questions to come in, yes, maybe Mark, I think I'd like to turn it over to you. Maybe there are a couple of things you would already like to highlight or some different -- difficult questions you have for Leonard or Frank.

Absolutely. Yes, once again, also thanks very much, Leonard. I think it was wonderful to get this insight. Maybe before we actually open up for some -- well, the questions are open, and we will start with them very soon. Maybe you can actually zoom back into these 2 very important slides, because you were actually explaining the GeoRisk management framework at that moment in time. So I think it's important that we go back to them and maybe you can speak live to these 2 slides, and we'll click through them.

Certainly, pleasure. So in the GeoRisk management framework, it captures actually all of the stages, which Fugro are participating in, right, from the beginning in feasibility, concept selection into design, all the way into the asset operation, Fugro has got a role to play in each phase. And that's where we can actually help contribute by lowering the uncertainty in each phase so that each phase actually benefits by less uncertainty to move forward either through insights or data analytics. And what you can see here is if you click forward, you'll be able to notice that we've shown this in a conceptual way, where the uncertainty line lowers every time it goes through that phase, and it lowers by our solution. There is applying of a solution or a combination of technologies that facilitates that unlocking of insights. And the unlocking of insights is then passed on digitally -- or sometimes analog in some industries -- into the next phases. Now the next slide, you will see that what we propose to do, if you keep on clicking, you'll see there's some technology. So these new technologies, they're advanced technologies, they're actually exclusive to Fugro. And what they're able to do is actually a leap ahead of that curve that we've created before. And that lowers the uncertainty much earlier than the program, thereby giving the visibility for the clients to get the insights and make informed decisions, and ultimately pulling the time, the schedule, forward. That [ gains ] -- creates immense value in the -- even the cost of capital for delivering a project earlier. So this overall concept of velocity is core to actually Fugro and not only just the land business.

Okay. And if you talk about the technologies which we see on the screen there as well, I think that this is a great synergy that we see between the different businesses in land and marine. So you talk about it, you still see it on the screen there in the middle. The deep drive system that was also shown by Frank. So who owns this now? Is it Land or is it Marine? What happened there?

It's both. So the thing about Fugro, it's a beautiful company and the idea of scale, technology and people. You [ cannot ] get a combination so ripe in Fugro that you can actually achieve these impacts to the industry. And literally, there is an impactful way that we can operate in the business. And what Frank showed in his video, where there is a deep drive deployed to the seabed, it's operating, it's pushing it, going into the ground, that technology has been matured in the Marine business. It's evolving still. But we've taken that and put it into the land context where literally today, we have a deep drive going around the site with no people on it. Literally, robotic, autonomous. It's controlled remotely and it's able to actually take that data and stream it directly live to the clients. So this technology sharing is very critical to actually how Fugro can make that impact. One of the other newer technologies that we're also taking from Marine is a great benefit is in the optical range, where we're using blue light to actually create an alternative to total stations. We're hoping to roll that out potentially in a subscription or recurring revenue model in the next year or so.

Wonderful, great synergies. And if we talk about the synergies and the geo-data, obviously, Frank, you were talking about the vast amount of geo-data that is required. And then specifically, the digital delivery platform I think there you spoke about. Can you say a few more words about how important that is, especially in the line of also getting into a different business model where you have recurring revenue in the future?

Yes, absolutely. I think it's a big part of our future, and it's also a synergy with lands because we both use the same platform. I think Leonard and I both are in the business for quite some while. In the past, we delivered the data on paper. There's big piles of reports, and we went to PDF, and now we really have an interactive platform where our clients can manage and use data sets, they can exchange the information with their subcontractors, with their design teams that can interact with the data. So I think this is really going to be a huge part of our future. And we see that facilitates the whole design process. And that applies both to the land business, but also very much to the marine business.

Okay. And this actually goes beyond the project that we execute so if we do a wind farm site investigation then okay, that might take half a year and beyond. They will still use this.

Exactly. And that's also, some of our clients -- so I had a quote from the end there in my presentation. During the site investigation, we create a digital twin of the site. So the data is -- beams life into the portal in a secure environment. So the client has it restricted, they can decide who sees the data or not, but also the data remains there. So also during the construction phase and also later down the line in the O&M phase. They have a digital twin of the construction site. And we can also add asset type of data later there. Similar to what you're doing, of course, in the land environment, there's a lot more existing infrastructure -- and so settlements are a bit more important than, for instance, in the marine environment with wind farms. But the principle is the same. And so we can really cross utilize this technology across all the business.

Yes, fantastic. Catrien, I think we have questions coming in.

Indeed, I was just going to say, we do indeed have a couple of questions here right now. So maybe we can start, yes, I think, Frank, the first 1 would be for you to answer. What is the typical time frame for Fugro's involvement in a project for wind? Or actually, it's also asked and/or infrastructure, but let's do wind first. And how does the invoicing happen over this period?

Yes. Okay. Very good question. So I think we're involved in multiple phases in the wind farm. So our heaviest involvement initially starts with the design phase, where we gather the data. that typically -- it takes a few years. So at Ocean, we are in early, so we typically deploy these buoys like 5 years in advance. Geophys and geotech come thereafter and then we provide more data into the design. And so that's typically the development phase, say, roughly 6 to 5 years, but that time line is shortening. Then we have a construction phase, typically about 2 to 3 years, where we also provide our services. And then later down the line, of course, you've got the operation maintenance phase, which is the largest phase. And we have got -- there we still got a lot of opportunity as well because we're not that dominant in that market as we are, for instance, in the earlier phases. Maybe to come back to the question on invoicing. It's a hybrid model. So we are -- in the beginning, we are really project by project. But for instance, with the digital platforms, also our clients pay us to make that data available to them throughout the life cycle. And so there's also some recurring revenue models. Later down the line in O&M, you see also much more need for monitoring types of services, which have a much larger life span, of course. So we're moving really from a project-by-project revenue model to more yes, a subscription type of revenue model.

And Frank, when you say project by project, you mean, let's say, phase by face. So metocean would be a project and geophysical or geotech would be a separate project?

What we see is that we see a bit of a change there in the market. So in the past, the projects were much smaller. So our clients would subcontract individual components to us. What we see now more happening because of the size of the projects, that our clients are much more interested in an integrated approach where they procure all of the data services with us, so they can get the data delivered to them in 1 platform. And also they don't need to manage all the interfaces themselves anymore. And so it's moving a little bit from data type by data type procurement to a more integrated procurement model. Yes.

Okay. Yes. And Leonard, actually, yes, it was also -- the question also relates to infrastructure projects.

Yes, you can see through the GeoRisk management framework, we're involved in each phase, each element of the construction and also the asset operation. And of course, the earlier phases are typically shorter duration projects: they could be in the order of a week to a month. And then later on, as it goes into the preliminary detail design, the project durations increase. Now when it gets to the larger infrastructure projects, this is where you go from perhaps small projects, weeks; to large, years; and delivering that geo-data along multiple years for the project life cycle. Typically, all of these projects have a monthly invoicing schedule. So we're actually locked into monthly, and that goes for the duration of the project. So very few of them, we actually have milestone payments -- perhaps maybe for mobilization, we'll have a milestone, but thereafter, it's always delivery on monthly.

Wonderful. Very good. Yes, there's a question coming in around the involvement of offshore wind parks. So before we have mentioned actually to be involved in more than 90% of the wind farms. And I even said that myself as well in the past, Frank. And that was very much related to the developments in Europe at that time. A couple of years ago, this was really the case. And now we see global involvement in Fugro for all the wind parks and then you refer to 50% of the wind parks being involved. The question is, is the competition increasing? And also another question on top of that, are we playing a different role in fixed base versus floating wind? Maybe you can talk a little bit about those 2 items?

Yes. I think -- if I'm not mistaken, I said more than 50%. I think we -- most of the offshore wind farms, we play a role. And that can be sometimes a small role, but it's always a critical role. We see that the bulk of the geo-data is in the geo-tech and geophysical service lines. And so I showed the market shares there. So it's still a considerable market share that we have there. At the same time, the industry is, of course, growing. So we need to grow with the industry, and we're doing that. And so we're investing in technology, we're investing in people to be able to serve our clients around the world, and they appreciate it.

And you show these pictures of geophysics and geotech on the market share. That is not our own data. That is ...

Yes. So that's a report recently issued by Rystad. So I think they're roughly right. They might be overestimating our market share a little bit in some places, but I think we are clearly the market leader.

Yes. Yes. Okay. And then if you talk about floating wind versus fixed base.

Yes. Now floating wind is, of course, still very young. There's hardly any floating projects around here. There's a couple of pilot projects. So it's really in its infancy...

Is this a market for the next 3 years? Or is this something for 5 or 10 years out?

It is actually accelerating. If you would have asked me the same question a couple of years ago, I would have thought it would be further into the future, to be honest. But you see it's now accelerating. because -- also because of the current environment that we're in. So -- and the tipping point has been reached there as well with increasing turbine sizes. And so you see now quite a lot of acreage being auctioned, -- for instance, in Scotland, you see a lot of activity but also in Italy, in Korea. Later down the line, you will see the same happening in the United States. So it's really going to happen and not in the far distance -- in the relatively near to medium term, you see this happening. And we are actually very well positioned also for the floating wind market because we have our experience from the deepwater as well. In the past, we have been very good in a deepwater surveys and we're applying this technology now also on floating wind. So of course, there will be some differences, but I see them mainly as opportunities, especially because these sites will be even bigger. And like I explained also in the presentation, we will have actually more touch points to the soil. And I recently saw a presentation from another party, the amount of offshore mooring systems that will be installed is astonishing. It's the like [ 1.5 times ] the circumference of the world that is going to be installed in terms of mooring system. So it's really an interesting market for us.

Yes. And the size, actually, of these windmills become enormous -- because I spoke to somebody actually last week around Italy, and we're talking about the tip height of 290 meters above the water line. So a span of 260 meters.

It's gigantic, yes.

It's amazing, yes, for floating wind.

Maybe to add a little bit there. I think also because the complexity is increasing, also that gives us a lot more opportunities also in the later life cycle phases. And because a monopile is -- you need some inspections, but it's nothing compared to the type of inspections you would need for a jack-up type of structure or a floating structure. They are much more inspection heavy. So also there, we see really a very good market for us going forward.

Yes. Okay. And there's 1 more question around, can you compare what we can do with an uncrewed platform and what we can do with a full-size investigation platform?

It's a very good question. We are quite well advanced in our own uncrewed service offering. So we would say we are the market leader in our domain there but it's also not easy. It takes a lot of technology to be able to do that because you not only need to operate the vessel remotely, you also need to transfer the data -- you need to redesign the whole ecosystem basically. What we see now in the market, we've got some USVs able to do hydrography work. We've got some USVs that can do ROVs, like vasal inspections. And the next step is also that we take more of the geophysical work, and we think that we can do a lot of the work that's currently been done by our vessels with the USVs, but they can never fully replace them as well, because some of the things will need still manual intervention for the time to come.

And does that mean that the growth actually -- that we're trying to actually grow with the uncrewed platforms?

Yes.

And keep the size of the fleet more or less the same.

Yes, exactly. It's because the market is growing so fast. The uncrewed vessels are actually a good way for us to grow in a relatively asset-light manner because they are very supplementary to each other. So you can use the specialized vessels that we have for the more complicated works and scopes, and we can use the uncrewed vessels for the little bit easier scope. So the complex vessels don't need to do the easy work, and we can put that to the drones.

With a significant reduction of CO2 emissions, obviously.

Absolutely.

That's 90% with the year -- or more than 90%.

Yes, exactly. It's 90%. And also, we can -- some of the vessels they can run on biodiesel and then it's further and it's even close to well, probably 98%.

Yes. And I saw a question actually also on the land side related to the reduction of CO2 and decarbonization. How are we tackling that on the land side, Leonard?

So again, it's a transfer of technology from Marine. In the case of the deep drive, that's now moving into a battery-operated system, where it can operate for the full day and recharge at night, plug-in, and that can be autonomously operated from wherever. But we're also moving into that domain where we're talking about site screening and that new technology of SWANS enables less intrusive perhaps manual work, which means less drill rigs, less ...

These are the nodes on the floor that you put on and then you start listening.

Yes. So it's a passive seismic solution. You install the nodes, they listen for a period of days and then you collect the data, and that's able to map the subsurface in 3D, giving you insights to actually optimize the intrusive investigation.

Okay.

So you do less of the manual work and more of the smart workup...

Specifically interesting for these larger projects, I guess.

Typically, yes.

Okay. Very good. Okay. Catrien, you had your next question?

Yes, I see a question that is maybe kind of -- it's a question maybe both you could address, but maybe -- I think I'm looking at Leonard first. It is offshore, but it's infrastructure. With recent explosion of subsea Russian gas pipeline in mind, can you share your thoughts on increasing security threats for subsea infrastructure and how to better protect the infrastructure.

Maybe before they jump into it, maybe I think it's good to mention that we recently got some requests related to obviously the explosions around yes, the Nord Stream pipelines. And at the time, because it's such a hot topic, and I think it's good to mention it here as well, we decided not to get involved yet because we feel that this is still in the middle of a geopolitical uncertainty and tension there. So these questions are really live and we get them now from multiple countries, actually, governments -- also in the Netherlands, we're talking to the government to explore what can be done, and the Norwegian government also contacted us to see, in general, what can be done to actually protect subservice and subsea structures in general. But maybe Frank or Leonard, you can say something specific what we can do related to protecting -- and this is still an exploration area because we haven't done this. Nobody has done this yet in the world other than maybe military trying to provide some of these services. Any thoughts, guys?

No. I think what we -- we're currently not very active in this market, as you already stated, Mark. I think some of our technology can be used, for instance, to see -- to inspect them. I think for instance, the example from the Nord Stream pipelines, there were probably already some explosives there for quite some time. So -- and our technology is, in principle, able to inspect pipelines -- but cables also, we are very active in fiber optic cables, for instance. So we have the technology to be able to do that. I think also, what it clearly shows is that electricity infrastructure is pretty fundamental to our life. We see that now happening in some places of the world where you can be also vulnerable as a country and I think also there, I think, having a good infrastructure in place -- but also offshore wind. It's a lot more difficult to take them out with all these different turbines than, for instance, a nuclear power plant. So I think also that, that element, we need to make sure that what we put in there is very resilient. And I'm sure that a lot of people are currently thinking about these questions with us.

Yes. And jumping over to Leonard. Leonard, you spoke about nearshore work. So maybe you clarify that to people. So land is nearshore or nearshore is land or how does that work together? Because this is also an area of opportunity here, yes?

Definitely. And that's -- we've seen significant growth in the LNG downstream facilities, particularly in U.S.A., Mexico, Canada and Germany -- and partly addressing that risk of pipelines, now these facilities are shipping gas between each of them using ships. So kind of circumvents that challenge. But definitely, nearshore is part of our activity. It's a platform. So it's very much like drilling from land but on a platform. And that's where we play in there -- the transition zone, to actually identify what are the sole conditions that would actually be susceptible or good for design in port export facilities around the world.

And then the coastal resilience area that you mentioned, that's obviously also nearshore basically because that's always the connection between land and the marine element.

Yes, coastal resilience plays -- actually, there's a synergies role between many of our business lines. That's -- it's a growing market. We're seeing a lot of importance because, as you see, climate change agenda is moving the risk into land from the sea. And that's where we're working together with the solutions where it could be LiDAR, seabed scanning or it could be hydrology or could even be infrastructure building of levees along the sea. Coastline is critical to actually protect those livelihoods and -- like it is for the Texas Spine.

And there's also coastal restoration projects because there's also money obviously allocated to those kind of things are ...

Natural capital is actually a big element, and that's where we see probably a lot more resilience in natural capital than there is actually an infrastructure. And in fact, the earth or Mother Earth has actually been able to protect itself on the coastlines with that natural capital. So restoration using nature is one of the more resilient means to actually protect those livelihoods.

So Fugro gets more and more involved actually with the nature element of it rather than only getting involved in the asset itself.

Yes. Correct.

Yes. Okay. And maybe I'll jump into the next question for Frank, but that's more the wind-related work. How do we stay market leader? How do we actually stay competitive? How do we keep that dominant market share, so to say, which is obviously always nice to have a good market share, to be #1 player in these fields.

Yes. That's the key question. I think it's always a risk to become complacent. I think it all starts with listening to your clients and understanding the market that you're operating in, understanding the challenges that these clients have and how we can help them. And next to that, I think it's a continuous investment in technologies and in people. And I think maybe starting with technologies, we have been also over the past period, where there has been downturns, we have been continuously investing in innovation like you know, Mark. So we now see that we have some very good technology platforms that we can utilize across our business. And so in that sense, we're very well positioned for the future. But I think the last -- but that absolutely should be the first point, it's our people. And we need to continuously invest in people, make sure that we are an attractive employer and we're actually quite successful in that. A lot of people apply if we put out an advert, but also a lot of people apply proactively because they see what we are doing. They like our technology, they also like our values and the markets that they're active in. So we see quite a lot of talent also from other industries now coming to Fugro. So I think that's absolutely fundamental to staying ahead.

Because obviously, that's a whole new industry that needs to be equipped with new expertise and new people.

Yeah, exactly.

We always hear also a bit of a problem that we get always to the table when we talk to investors and analysts is can you make any money in the offshore wind environment because it's all about, yes, we're a business here. How do we make money? And is that different from the markets that we used to serve -- or how do you see that there?

No, I think it's -- some of the parties active in the market are struggling to make money. Also I think everybody is playing in their own part of the market. I think we are doing quite well, I would say. And also, I think our market circumstances are improving to our benefit, especially if you see the increase in scale that is currently happening, that will affect -- you need a decent sized company to be able to serve these clients because they are really billion -- a billion investment, a very complex investment project. So I think that helps. I think what also helps is that we have synergies. And I think one of the synergies is between Land and Marine. And so we can cross-utilize our innovation euros and we can make sure that the -- [ we have ] also there and make sure that we can differentiate ourselves, because what I presented earlier also that we are really a one-stop shop in that sense, we're quite unique. So that makes it also for us easier to make money. And currently, we have a little bit the opposite problem that we need to disappoint clients if they come to us too late because the market is really growing so fast that they need to really work with our clients to make sure that they have suitable time slots at our vessels to be able to investigate their sites.

And maybe before we go back to Leonard, can you describe why is an offshore wind farm more interesting, for instance, even for Fugro with their expertise compared to maybe what we used to install -- or used to be installed in traditional markets in the past in development of platforms, maybe offshore. So why is there so much work? And why do you need to increase the laboratory capacity because you have increased by 40% already, and you need to increase even more. Can you explain that?

Yes. It's -- a lot of it is driven by the nature of the asset that needs to be installed. So an offshore wind park typically involves hundreds or sometimes even more turbines, so -- and a lot of cables. So we need a huge amount of geo-data to be able to design the asset. And so I think that is a big driver. So I think that's -- that, together with our expertise, will position us well into the future. And I think the other element is also the complexity of the loading patterns, for instance, because the wind turbine is extremely cyclic. And so the loading patterns are very cyclic. And also, you see a lot of lateral loads. And so in that sense, it's a much more complex foundation that you need to design than if you would just have a heavy object that is only pushing downwards.

Because it's a big structure in the middle of the wind.

Catching a lot of wind, a lot of waves. So it's a very hazardous environment to design a structure that catches a lot of wind. So if you don't have the right data, yes, you get into trouble. So I think in that sense, it's not only the scale, but it's also the complexity that makes it very interesting.

And what a lot of people don't know is that each wind power, and you showed that there are 4,000 to be installed. They are different. None is the same. Why is that?

Yes. No. Yes. That's because of the money involved in creating these foundations. So 50% of the steel is actually in the soil. So the soil is different everywhere across the site. So you've got 100 turbines, you have got a big chance that a lot of these -- almost all of these steel foundations are slightly different. And so they're optimized to make sure that we don't put unnecessary CapEx into the soil, and we need to have an optimized design.

Yes. Yes. Now if we jump to Land because you spoke about these very large projects, Leonard, and we see more than 450 of these large projects worldwide. Why is that different than the past? So that's my first question. And then if we describe and look at the problems that we face or the problems that we actually try to tackle for our clients in the offshore wind environment, why is that the same in lands that this is more complex now -- this is much larger and there's more geo data required? Can you explain that?

Certainly. I mean the biggest driver of -- the trend that's driving all of this is the urbanization, and that's where people are moving to cities. These mega cities are getting bigger and bigger. And as they actually embark on actually redeveloping their infrastructure to serve that demand, they're coming across overlays of different existing infrastructure, which creates a complexity in itself in construction, but also the extent of the infrastructure is actually quite large. So it crosses many types of geology or geotechnical challenge. And by doing that, they actually need a geo-data solution to enable a lowering of that uncertainty across the span of the whole project. And these projects take a long time to actually investigate and a long time to get to the point of construction. But it's ultimately coming down to the urbanization, which, as you can see, there is an 8% growth in the industry, construction industry. But for Fugro, we have an opportunity to grow much larger than 8% within that large pie.

So now let's assume I'm an investor. I also would like to know how much money do I need to pour in then Fugro to actually make money in the future. If this is growing, that means a lot more investment? Or how do you look at that?

Actually, the thing that separates Land and Marine is the access. And always in the marine space, it's the challenge of access to the site. To get to the site, you need a big taxi -- that taxi is a ship, and that costs a lot to actually get to the site and actually start doing the work. But the thing with land is that you can be a lot more agile, a lot more lighter in the asset and getting to the site actually requires less effort. So what we are seeking to do is actually have smaller assets, probably more high technology and actually have these site screening solutions, which actually can target the areas that are important to investigate rather than the areas that we should just blindly investigate.

Yes. And going over to geophysics, basically, the SWANS technology that you showed with these sensors on the ground that will allow you also to do less intrusive work with drilling rigs going into the ground.

And you can appreciate that every time you do an intrusive investigation, it's a matter of time. It's not about the effort that's done, but it's actually time that's taken out. So to scale to large projects, they have to have multiple, say, drill rigs or CPT trucks, but then they put a limitation on the actual delivery schedule. But if you're able to optimize those number of assets and deploy them exactly where you need to rather than just doing a grid approach, you then can deliver a time benefit that the clients can then pocket as cost of capital, for example.

And do the clients already appreciate that?

Yes, it's been significantly appreciated. We've delivered 50% time scale in NEOM. We've delivered also similar scales in many other cities. So this technology is quite advanced and very beneficial.

But still very new, and it still needs to further expand.

Yes, it's an opportunity to scale.

It's promising.

That, of course, you need to take the market with you. And that's where we're working with key engineering firms to take that journey.

Yes. Talking about investments, and then I'll go over to -- but talking about investments, because there are a few questions on investments. Frank, you said, well, I need to stay the market leader and technology people and so on. But okay, how does that mean and what does -- how many millions more do we need to invest? Or how do you look at that? This is a question we always get.

Yes. I think -- of course, if you grow, you need capital, and that's clear. I think we have some technologies that will enable us to become a bit more asset light. We obviously will still need vessels also for the -- especially the more complex operations. But also, we invested quite a lot in our innovation portfolio on asset-light solutions. For instance, mobile drilling rigs, but also the uncrewed vessels that we saw earlier. Also, we're investing quite a bit in seismic technologies to map these huge areas because they're becoming really much bigger. So we really invested quite a bit of our innovation money in new technologies to efficiently map these sites. Some of that is with more traditional vessels, but most of the growth we can also capture with some of the newer technology.

Is that buying things from the shelf or off the shelf? Or is that developing yourself, you're talking about developing?

Yes. It's a bit of both. So in the past, R&D was something you did internally. You put a big fence around and everything was secret. Now we're moving more into partnerships. But it doesn't mean that -- you still need to have a lot of knowledge yourself as well. And I think we have knowledge about the technology and like, for instance, the digitization of our workflow. There's quite a lot of people that we now employ that know about cloud computing, for instance. But we match that technology knowledge with geo-data type of knowledge. And that's, I think, what makes us quite unique and well positioned, I think, also to grow in a more asset-light fashion.

Actually, I'd like to add to that because the beauty of Fugro is that it's contact with the market, contact with the clients. And not only being in the role of developing technology for the industry and then taking that through its maturity phases, but we're also able to tune that in the right way possible, so it delivers the solution to the end user rather than just being only a senor company, no, we actually deliver it to the edge.

One thing I wanted to add to what Frank was saying -- because you mentioned seismic and that can be a bit confusing. Because often analysts and investors, when you talk about seismic, people think about deep seismic imaging for hydrocarbon reservoirs. That is something, that is a business that we left 10 years ago. I just want to make that clear. This is just for very shallow geophysical...

We recall this engineering seismic, so we are mapping the shallow layers to extremely high accuracy. And we've got now some technologies that actually can do that to almost centimeter level. So it's really a high resolution, but very shallow.

Shallow.

So we're not looking for reservoirs.It's purely for [ base] foundation...

Thanks for clarifying that, Frank. I have -- we are almost through our questions, by the way. You're doing really well. But I have one more for you. Obviously, your presentation, you've talked most about the work that we do on the site characterization phase. You have briefly mentioned that we also do some work during the installation phase and that we are planning or we're looking into also becoming active in the operation and maintenance phase. The question that we got or that you got is, can you give a bit more details on what your plans are there and what the time line is for Fugro to get -- to become more active I would think, in particular, on the operations and maintenance side?

Yes. I cannot give you a lot of detail yet because we're currently developing our portfolio there. So I don't want to give any prewarning also to our competitors there. But I think in the presentation today, you probably saw quite some technology examples. We are now, for instance, able to deploy an ROV, an underwater robot, for visual inspection from an uncrewed vessel. That's really quite unique, and we do know no one has that solution at the moment. So I think we'd be traditionally quite strong in those types of inspection services. Also, we're quite strong from other markets in monitoring types of solutions, and we monitor already quite a lot of floaters and we've got some technologies in place that we can easily also deploy it in offshore wind. So we're looking at reusing the technologies that we already have into new markets and also at the same time, a bit longer in the horizon, we're looking at potentially developing new solutions as well.

Yes. Okay.

So not a lot of details but [indiscernible].

[ So we know what is ] [indiscernible] So not more specific on time line, but to give an insight on what is the working on.

Yes. And what you see now is that the market is now really into exponential growth phase. And also this part of the market is really maturing where it was very local project by project, you no now see clients are ready to have that conversation and see if we can really come up with some more standardized solutions for their problems.

Still relatively new, but we're all watching closely and thinking and developing our solutions.

Yes. And I think we've got some very good technology that we can almost directly apply.

Yes. By the way, I do see it's 4:00 now, which is, in principle, the...

One more question for Leonard coming in -- so -- but Leonard, so the size of these large projects, so we do like 36% in the infrastructure and water market. So how much of the revenue today is already in these large projects?

The value today for land is in the order of between 20% to 30%.

20% to 30% is already coming from these large type of projects. And now the complexity, you spoke about project complexity and the complexity is increasing. So what does that do with the liability that Fugro gets because, yes, Fugro is supplying this data. How do you look at that?

So ultimately, around the complexity is to actually determine where is it spatially, where is the complexity and then characterize that complexity. So typically, what we find is that giving those insights with greater precision, high-quality data, it allows us to be better informed to do the analysis and provide more reliable results to clients. So it's about being a bit more clever in how you characterize the complexity rather than what is traditionally done is a scattered approach to just probing the ground and hoping that you will find the anomaly that will actually reveal the problem.

So the essence of the GeoRisk management framework is actually to reduce the risk.

Risk -- exactly.

Despite the complexity.

Yes. To start early. A lot of the times, you're seeing clients traditionally, they will actually pass the uncertainty or the risk on down the line, but we're able to actually join that together in, say, digital twin models that each stakeholder is actually benefiting from the previous unlocking of uncertainty.

Yes. Yes. Wonderful. Okay. Fantastic. Yes. I think we answered the questions.

Yes, I think we answered the questions. I hope we answered them all to your liking, but we've done our best. And yes, I very much want to thank you all being here and particularly Frank and Leonard for 2 excellent presentations, I think, very, very insightful. And Mark, for being here and being the host -- and of course, to everyone who participates in this webinar. Thank you so much. We are very happy to do it and we hope it provided you with some more insight into yes, our business, our solutions, our prospects for the future. You can, via our website, you can get further access to watch it again, if you want to, and we'll also post the presentation online. As said, that might take until tomorrow morning, but we will get it done. Any other questions or responses, you know where to find us. Thank you so much.

Thank you.

Thank you, Catrien.

Thank you, Mark.