Dutch geo-data specialist Fugro has reported a tough start to 2025, citing rapidly shifting geopolitical and economic conditions that are hitting client confidence and delaying project decisions, particularly in the US.
Revenue dropped 11% year-on-year to EUR 450 million, down from EUR 503.2 million in Q1 2024. The company’s EBIT margin slumped to just 0.2%, a stark contrast to the 8.8% posted a year earlier. Operating cash flow before working capital changes took a hit too, falling to EUR 21.2 million from EUR 65.4 million.
Fugro is not alone in feeling the weight of global uncertainty, but the company’s exposure to the US market, already under pressure from political headwinds, has made its Q1 results particularly challenging. CEO Mark Heine pointed to client hesitancy as a key issue. “Market conditions have rapidly shifted, making clients more hesitant to commit to new projects,” he said. “This happened while we were already adapting our Americas operations to the new political reality in the US.”
Despite the shaky start, Fugro says it remains committed to long-term goals under its “Towards Full Potential” strategy, while putting short-term focus on safeguarding margins and maintaining cash flow. Free cash flow slipped further into the red at EUR -84.4 million, compared to EUR -58.0 million in the same quarter last year.
The company’s backlog for the next 12 months saw a mild decrease of 3.3% to EUR 1.48 billion, hinting at broader market caution but also suggesting some stability. This dip aligns with what Fugro described as “current market dynamics,” echoing concerns raised in its 15 April update.
Still, there are bright spots. Fugro recently landed a contract with the Dutch Ministry of Defence for a marine security and surveillance vessel, in partnership with Damen. It’s a sign of where the company is placing its bets—on critical infrastructure, underwater surveillance, and emerging markets like critical minerals.
The company remains optimistic about achieving its full-year EBIT margin target of 11–15%, but any concrete revenue forecast will wait until there’s more economic clarity on the horizon.
