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Dear colleagues,

On the eve of the (European) summer and some well-deserved rest for many of us, I would like to give you some more information about the contracting activities in Belgium, the Netherlands, Luxembourg, France, and Italy.

None of us will forget the first half of 2020. The pandemic has thoroughly shaken our personal, professional, and social lives. The first wave of the crisis is under control in all the above-mentioned countries thanks to unprecedented measures. The risk of a second wave lurks around the corner, at least until a vaccine is found. The good news is that the past few months have shown what we are collectively capable of if we stand behind one goal.

The pandemic also impacted the results of BU Europe: lower sales and additional indirect construction costs. With enormous help from the support services, our projects have started discussions with our customers and will continue to do so in the coming weeks and months. In addition, we have taken measures on several projects to make up for some of the lost revenue.

I would like to explicitly express my enormous appreciation for the creativity and passion that many of you have shown in coping with this unexpected situation. The speed with which production picked up again when the measures were relaxed in Belgium, France, and Luxembourg is another fantastic example of this.

It has to be said: even before the outbreak of the virus, we faced a number of important challenges. The GAP[1] analysis showed poor overall profitability. We must dare to face this so that we can find sustainable and structural solutions. In order to make this a reality, a number of initiatives are being developed at group level(e.g. digitization of a number of processes in the implementation, standard application of the LEAN principles, and closer cooperation with the procurement team). In addition, a concrete strategy for 2020-2025 will be worked out per country/region.

I am counting on all of you to implement these initiatives together in order to achieve the desired results. With regards to the first recommendation resulting from the GAP analysis, 'choose better', our procurement teams have already done a very good job in recent months and their creative ideas and good relationships with our customers have improved the quality[2] of our order book. I am also confident that this positive starting point will lead to great results if it is followed by meticulous preparation (prepare better) and flawless execution (execute better). This requires an individual and collective effort of all site teams as well as our support services.

In the future, in addition to the above, we will also have to integrate more sustainable and digital solutions into our projects. We will have to steadily increase our knowledge in this area in order to be able to offer the right solutions that meet the real needs of our customers. I applaud this evolution, which will allow us to differentiate ourselves in even more areas while at the same time tackling major societal challenges, such as climate change.

In conclusion, I wish you all a beautiful summer and some well-deserved rest. Stay healthy, take good care of yourself and your loved ones in these still unprecedented times.

Take care,

Jan

[1] Analysis carried out by the Executive Committee of the evolution of the profitability of our projects over the past 5 years. This led to actions in 3 areas: choose better (tenders), prepare better (design & work preparation), execute better (execution). If you would like to know more about this, do not hesitate to contact your regional management.

[2] The quality of our order book is determined by the ratio of general costs & profit to the total turnover of the project.