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Second Quarter 2010

Second Quarter 2010. Harrie Noy, Chief Executive Officer Renier Vree, Chief Financial Officer August 4, 2010. DISCLAIMER.

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Second Quarter 2010

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  1. Second Quarter 2010 Harrie Noy, Chief Executive Officer Renier Vree, Chief Financial Officer August 4, 2010

  2. DISCLAIMER • Statements included in this presentation that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward looking statements. These statements are only predictions and are not guarantees. Actual events or the results of our operations could differ materially from those expressed or implied in the forward looking statements. Forward looking statements are typically identified by the use of terms such as “may,” “will,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of such terms and other comparable terminology. • The forward looking statements are based upon our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward looking statements.

  3. Operationally good second quarter Improved profit on back of strong revenue growth No further organic revenue decline Infrastructure and Water remain solid Environment and Buildings are improving Especially U.S. private environmental market increases Margin at good level excl. non-recurring items Integration Malcolm Pirnie on schedule, extensive synergy For full year 2010 slight profit increase expected Well positioned to benefit from economic recovery

  4. Results Second Quarter 2010 Renier Vree, Chief Financial Officer August 4, 2010

  5. Gross revenue Net revenue EBITA Income1) Ditto per share1,2) 2009 415 287 28.5 17.1 0.28 _  _ 23% 23% 12% 8% 0% Income Q2 2010 € 18.5 million 2010 512 353 31.8 18.5 0.28 Positive currency effect of 5% from stronger US$, Brazilian real 1) Net income from operations before amortization and non-operational items 2) In 2010 based on 66.1 million shares outstanding (2009: 60.2 million)

  6. Gross revenue Net revenue EBITA Income1) Ditto per share1,2) 2009 833 577 56.3 32.6 0.54 _  _ 15% 18% 9% 9% 0% Income H1 2010 € 35.6 million 2010 960 679 61.1 35.6 0.54 Positive currency effect of 2% from stronger US$, Brazilian real 1) Net income from operations before amortization and non-operational items 2) In 2010 based on 66.3 million shares outstanding (2009: 60.2 million)

  7. Organic gross revenuedevelopment improved Currency effect 0% -4% -3% 1% -1% 5%

  8. EBITARecurringH1 In € million Increase 51% 31% 23% -1% 9%

  9. Modest organic improvement EBITA in Q2-2010 In € million 28.5 5% 14% -/- 9% 2% +12% 31.8 • Q2: better results in U.S., Brazil, RTKL and England, less profit western Europe (including NL) due to price pressure

  10. In H1 EBITA organically flat excluding energy project In € miljoen 56.3 1% 14% -/- 8% 1% +9% 61.1

  11. Margin stays at good level Q1 Q2 Q3 Q4 year 2010 9.5%3) 9.7%3) 2008 9.9% 10.2% 10.7% 12.5%2) 10.8%2) 2009 9.6% 9.9% 10.1%1) 11.0% 10.2%1) • Reorganization and integration costs: • H1 2009: € 5.3 million; H1 2010 € 3.3 million Margin: recurring EBITA as % of net revenue 1) Recurring EBITA excludes one-off impact share participation program of Lovinklaan 2) Excluding impact sale hydropower plants Brazil 3) Excluding loss on energy project Brazil

  12. Some financial details • As last year limited contribution from carbon credits • Contribution from carbon credits expected to increase in fourth quarter • Financing charges excluding derivatives: • H1-09: € 3.7 million • H1-10: € 8.7 million • Increase mainly resulted from financing for acquisitions • Tax pressure H1 2% lower • Income from associates higher (Brazil)

  13. In € millions Net income from operations and EPS H1-2010 0.54 0.54 0.52 0.44 0.35 Increase +3% +18% +60% +26% +9% Earnings per share (in €) In 2010 10% more shares outstanding

  14. Balance sheet stays healthy • Net debt June 30, 2010 € 273 million (December 31, 2009: € 174 million) • Increase debt € 50 million due to currency • Net debt/EBITDA: 1.4 calculated conform bank covenants 1) 2008, 2009 and 2010 calculated conform bank covenants

  15. Business lines • INFRASTRUCTURE • WATER • ENVIRONMENT • BUILDINGS

  16. Infrastructure H1-2010: 0% organic: -5%; acquisitions: 0%; currency: +5% • Gross revenue lower after completion projects with substantial subcontracting (Brazil) • Organic net revenue growth was 2% • Growth from central governments in NL, Belgium, France and Central Europe • Pressure in local markets slows growth • U.S. declines due to lower state/city budgets • Mining Brazil and Chile contributes to growth Connecting Central Europe

  17. Water H1-2010: +128% organic: 0%; acquisitions: +125%; currency: +2% • Gross revenue more than doubled by merger with Malcolm Pirnie • Organic net revenue growth was 5% • Demand water management grew in all markets • Brazil large waste water system contract • Pressure in local markets impacts water less • Malcolm Pirnie compensates decline in western and southern U.S. with growth in northeast Water treatment, U.S.

  18. Environment H1-2010: +13% organic: 0%; acquisitions: +11%; currency: +2% • Contribution acquisitions is environmental business Malcolm Pirnie • Organic gross revenue decline Q1 turned around in 7% increase in Q2 • Environmental market U.S. picks up: large remediation contracts with lot of subcontracting • Increase in net revenue offset by delays in some European countries • Organic net revenue decline 1% • Environmental market Brazil also shows improvement Measuring carbon footprint for the city of Gent in Belgium

  19. Buildings H1-2010: -9% organic: -9%; acquisitions: +1%; currency: 0% Designed and delivered the Shell new Technology Center in Amsterdam • Net revenue declined 11% • Decline in Q2 less than Q1 • Commercial property market has stabilized • RTKL compensates decline in U.S. and Europe with growth in Asia and Middle East • Pressure on activities in Belgium • Growth in public projects in U.S. and Germany

  20. Outlook Harrie Noy, Chief Executive Officer August 4, 2010

  21. Well diversified portfolio Figures H1-2010 Geographic Business lines Provides robustness versus economic cycles In markets with long term growth potential

  22. Good spread across client types

  23. InfrastructureMarket stays healthy, but growth weakens • In Europe many projects for which financing is committed • Investments in Dutch rail and road network • In NL financing form natural gas (FES fund) • Also large projects Central Europe with European funding • Demand for infrastructure drives PPP-initiatives in Europe and the U.S. • Brazil: large projects basis for growth and World Cup (2014) and Olympics (2016)

  24. WaterStrong drivers for growth • Climate change and increasing threat of flooding drive water management • Demand for clean drinking water and waste water treatment increasing, globally • Financing from specific water charges: water is a utility • Specialist know how globally applicable • Synergy with Malcolm Pirnie offers many chances also internationally (Chile, Brazil, Middle East)

  25. EnvironmentGradual recovery from increasing demand • Regulation and sustainability provide solid basis • Economic recovery drives demand from business • Large contracts because companies focus on core business and outsource portfolios • Vendor reduction increases • Growth market share due to strong competitive position • Growing demand for energy savings and carbon footprint reduction

  26. Buildings Bottom reached, revenue advance in H2 • Commercial property stable at low level, no recovery in sight • New legislation U.S. causes delays in healthcare • Backlog RTKL healthy due to Asia and ME: commercial and healthcare projects • Demand (semi) public sector continues • New contracts in Facility Management

  27. Outlook 2010 • Backlog healthy and up 8% from year-end 2009 • Growth in Q2 came from Infrastructure and to a lesser extent water and environment, buildings weakened somewhat • Modest organic growth in second half • Maintaining margins remains priority • Synergy with Malcolm Pirnie and in 2011 operational benefits • Further expansion through acquisitions is on the agenda • For full year 2010 slight increase of 0-5% of net income from operations (barring unforeseen circumstances) ARCADIS Building Global Leadership

  28. Imagine the result

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