Brunel International : Press Release FY 2016

Gross Profit
The downward trend of the gross margin due to price pressure and lower productivity continued in Q4. This quarter also had one less working day. The lower productivity is the result of continued training initiatives and pro active hiring.

Operating Costs
Operating costs are slightly higher than 2015 as a result of investments in our sales force and recruitment initiatives.

EBIT
Lower revenue at lower margins resulted in a decrease in EBIT of 61%.

Effective tax rate

In 2016 the effective tax rate increased from 33.6% to 56.2%, mainly as a result of an impairment of deferred tax assets of EUR 3.7 million. Due to the lower EBIT level, this impairment has a significant impact on our effective tax rate for 2016.

Cash position

The December 2016 cash balance amounted to EUR 149 million. Working capital as at 31 December is slightly higher than anticipated due to some short term projects in Energy towards the end of the year.

Dividend

We propose a dividend of EUR 0.40 per share.

Outlook

For The Netherlands we expect that the headcount growth we have resumed from July 2016 onwards will continue. This will result in revenue growth, despite the fact that we have started 2017 at a lower level than 2016. In Germany a new law will come in to effect in 2017. We expect that we have taken the appropriate measures and expect to see the growth continuing in 2017. Profitability in Germany will be impacted in 2017 by three less working days. For Energy we will see the full year impact of the decline in revenue in 2016, in combination with a further decline in headcount especially in the first half of 2017. As a result of our efforts towards new activities we expect that the revenue will be stabilizing in the second half of 2017 and we could even be returning to growth.

Jan Arie van Barneveld, CEO of Brunel International N.V.: 'The ongoing crisis in the Oil & Gas sector made 2016 an exceptionally challenging year for us at Brunel. We're now working hard to adapt the organization to these changing market conditions. First and foremost, by making ourselves more efficient, leaner and smarter in existing markets. At the same time, however, we do see new opportunities emerging for this part of the company. Both in terms of expanding our services, but also by entering markets outside Oil & Gas. However, it'll be a while before we see these initiatives and developments reflected in our results. And although recovery of the market for Oil & Gas projects is inevitable, making any more specific predictions at this time is difficult. Except for one: as always, we're confident about the resilience and entrepreneurial qualities of our people. And as a result, optimistic about the medium-to-long term developments and opportunities for this part of the business.

In Europe, overall growth and profit development in the region have been positive, but we have also seen considerable underlying differences in 2016. The Netherlands started the year very strongly, but then saw growth completely evaporate with the introduction of new legislation for engaging freelancers. The negative effects of which were luckily a one-off phenomenon. Meanwhile Germany managed in 2016 to accelerate even the impressive growth path achieved in 2015. But though the differences between countries are significant, the underlying results of all our European organizations in 2016 have once more been stronger across the region.

The robust organizations we have in Europe will form the basis for a return to growth. And, partly as a result of changes forced by the crisis, Energy will also soon be contributing to those growth figures. We live in times that are challenging, but also changing. And for strong organizations like Brunel, change always brings with it opportunities.'