Fugro Realigns Americas Ops Amid Offshore Wind Slowdown and Market Uncertainty

April 16, 2025, by Nadja Skopljak

Dutch Fugro has realigned its operations in the Americas by reducing its workforce and scaling back operations due to expected lower revenues caused by a pause in new offshore wind projects.

In the financial update for the first quarter of 2025, Fugro stated that rapidly increased geopolitical and economic uncertainties influencing client investment behaviour worldwide add to the challenges posed by adverse developments in the US market, in particular in offshore wind.

These issues are expected to lead to lower revenue and earnings compared to a strong Q1 2024, however, thanks to the implementation of measures to protect profitability, the company is confident that it will deliver within the mid-term EBIT margin target range of 11-15 per cent for the full-year 2025.

In accordance with the guidance provided in the 2024 results, the shift in the US political landscape has led to a pause in new offshore wind projects, with the highly volatile market environment now impacting Fugro’s business in other regions as well.

Fugro noted that some scope reductions of projects and award decisions are taking longer, exacerbating the typically slow start to the year.

Revenue for the quarter is expected to decline by approximately 11 per cent, compared to EUR 44 million from Q1 2024, with free cash flow anticipated to be approximately negative EUR 85 million, compared to negative EUR 58 million in Q1 2024, including scheduled capex of around EUR 100 million, largely related to the final phase of the company’s geotechnical fleet expansion program and vessel conversions.

As a response to current challenges, Fugro said it had made steady progress in the Americas with the realignment of operations, as well as initiated targeted cost reductions in other regions by reallocating assets towards other market opportunities, reducing personnel and leased assets, and implementing strict cost controls.

Fugro’s CEO Mark Heine said: “In recent years, we have transformed into a resilient and well-diversified business with a strong balance sheet. This enables us to act quickly and effectively in these times of uncertainty, supporting the generation of solid results through the cycle. Our immediate priority is to implement cost saving measures that safeguard profitability and cash flow, without losing momentum on our long-term strategy Towards Full Potential.”

In terms of outlook, the 12-month backlog is expected to decline modestly by 3-4 per cent compared to March 2024, reflecting current market dynamics.

“Even though our business operations are not directly impacted by US trade tariffs, current related developments are leading to increased market uncertainty,” the company said in the financial update. “Even with the current headwinds, we remain fully committed to executing our strategy Towards Full Potential. Fundamentals in our core market segments remain strong, and we continue to see growing opportunities in emerging areas such as critical minerals and surveillance of critical underwater infrastructure; areas in which we are well-positioned to lead.”