communications

buildings environment

infrastructure

Results second quarter and first half 2004

Harrie Noy, CEO Arnhem, The Netherlands, August 10, 2004

Main developments in first half 2004

Gross revenue increased 10%, net income from operations 4% higher

Outside the Netherlands developments are positive

Environment main growth market at 15% organic growth

Continued growth in infrastructure in most European countries

Market recovery in Brazil and Chile

Dutch market requires further restructuring

Gross revenue

Operating income

Net income f/ operations 1)

Ditto per share 2)

1) Before amortization of goodwill

2) In 2004 based on 20.5 million shares outstanding (2003: 20.3 million)

2003

198

7.9

5.7

0.28

2004

223

9.0

5.5

0.27

Excl.currency

+15%

+16%

-/-1%

-/-1%

_ _

+13%

+14%

-/-3%

-/-3%

Income second quarter 2004: € 5.5 million

Lower net income from operations because of lower

contribution NCC’s

Income first half 2004: € 10.0 million

Gross revenue

Operating income

Net income f/ operations 1)

Ditto per share 2)

1) Before amortization of goodwill

2) In 2004 based on 20.5 million shares outstanding (2003: 20.3 million)

2003

391

14.8

9.6

0.47

2004

431

16.9

10.0

0.49

Excl.currency

+13%

+17%

+7%

+7%

_ _

+10%

+14%

+4%

+4%

Activity growth in 2004 (excl. Currency effect)

0%

2%4%

6%8%

10%

12%

14%16%

18%

Q1 Q2 H1-2004

Organic Acquisitions Total

Currency -4% -2% -3%

Q1: growth through acquisitions

Q2: organic growth GR 7%, but

growth NR 3%

Cause: more subcontracting

(GRiP, Facility Management, GIS)

Organic growth: environment,

infra Europe and recovery South

America

Netherladns: organic decline in

gross revenue of -/- 6% (H1)

Sale proceeds +1% - +1%

Development operating income H1-2004

In euro million

16,3

18,0 20,3

14,816,9

0

5

10

15

20

25

2000 2001 2002 2003 2004

First half 13%24% 11% -/-27% 14%

Development operating income H1-2004

0

5

10

15

20

2003 2004

Operating income

0%

5%

10%

15%

20%

25%

Currency-effect -/-3%

Organic -/- 6%

Acquisitions +23%

+14%

Net income from operations and EPS H1

8,89,9

10,7 9,6 10,0

0,0

2,0

4,0

6,0

8,0

10,0

12,0

2000 2001 2002 2003 2004

First half

+21% +13% +8% -/-10%

In € million

0,440,49 0,52 0,47

+4%+ 7%(excl. currency)

0,49

Earnings per share (in €)

Dutch market remains difficult

Government: large projects are ending, restraint on

government budgets

Poor economy slows down private sector investment

Focus on tendering procedures

Sustained high pension charges

Possible market recovery in 2005

Dutch market requires adjustment

0100200300400500600700800900

2003 2004 Total

Divestments Restructuring Total Sale of non-core activities 2003: Inspectrum/Dynamicon 2004: Bomendienst KAFI Mandaat

Streamlining organization Adjustment to market demand Reduction overhead Efficiency improvement

Invest in new activities Acquisition PRC in 2003

Focus on core activities with growth potential and higher margins

Reduction in 2 years approx. 30%

Number of FTE’s

70%

80%

90%

100%

110%

120%

2002 2003 2004

Net revenue Average FTE Net revenue per FTE

Increase in net revenue per employee

Financial effects restructuring in 2004

(in € million) Operating Net income income

Book profit on divestments: € 4.0 € 4.0Restructuring charge:

In first quarter € 2.2

In second half € 6.3

Total € 8.5 € 5.5Effect in 2004: -/- € 4.5 -/- € 1.5

Annual cost savings: € 5 million

Effect on profitability as of 2005: + € 2 to 3 million

Targeted margin improvement

7,4%9,3%

-1,1% -0,6%

-2,0%

0,0%

2,0%

4,0%

6,0%

8,0%

10,0%

Infrastructure Environment Buildings Communications

Buildings going through a transition Project management and consultancy (PRC and Homola) Facility management

Communications Sale of non-profitable parts Integrate remainder with other segments

Balance sheet

0,7

1,0 0,8

0,0

0,5

1,0

1,5

2,0

2002 2003 2004

Interest bearing debt / EBITDA

43,6%39,9% 39,6%

0%

10%

20%

30%

40%

50%

2002 2003 2004

Solvency

Balance sheet ratios remain

healthy

Solvency somewhat lower than

2003 as a result of goodwil for

acquisitions in second half of 2003

Higher EBITDA and lower debt

improves leverage

Enough room for new acquisitions

Gross revenue market segments H-1 2004

0,0

50,0

100,0

150,0

200,0

250,0

2002 2003 2004

Buildings +47% (+12%)

0

50

100

150

200

250

2002 2003 2004

Infrastructure +6% (-/-3%)

0

50

100

150

200

250

2002 2003 2004

Environment +8% (+15%)

0

50

100

150

200

250

2002 2003 2004

Communications -/-10% (-/-2%)

Infrastructure +6% (-3%)

Growth through acquisitions

Organic decline Dutch market 14%

Healthy growth rest of Europe

Recovery South America

U.S. market stable ( SAFETEA

comes closer – $ 250-275 billion for

6 years)

Synergy contributes to growth First high speed rail assignments in France through cooperation with The Netherlands

Environment +8% (+15%)

Environment main growth market

Organic growth U.S. 20%

GRIP® success with federal government (DOD)

Framework contract $ 200 million

Milan contract $ 45 million

Backlog remediation U.S. $ 300 million

Elsewhere also growth resulting from MNC

program

Large GRiP®-projects DOD

Buildings +47% (+12%)

Transition to higher added value

Acquisition of project management

and consultancy firms assures

growth (PRC and Homola)

Organic increase from facility

management

Growth Belgium, France, Spain

Decline mainly U.S.: automotive

industry Higher in the value chain with project management and consultancy

Communications -10% (-2%)

Organic decline net revenue of

12%

Particularly poor performance in

real estate valuations

KAFI and Mandaat sold

GIS added to other segments

Mobile GIS-systems

Focus on three segments

27%

13%

53%

7%

Infrastructure EnvironmentBuildings Communications

17%

55%28%

Infrastructure EnvironmentBuildings

2003 E-2004

Acquisitions contribute to growth

Acquisitions 2003 perform according to expectations

Acquisition policy is continued

Priority: expansion in the U.S.

Targeted acquisitions for strengthening positions in Europe E.g. Central Europe

Possible expansion to South East Asia ARCADIS office opened in Shanghai

Outlook market

InfrastructureNetherlands: chances in improvement infrastructure Possible growth in trans-national European networks U.S. market stable; recovery in Brazil and Chile

EnvironmentGRiP® growth in U.S. and Europe MNC focus on longterm contracts

BuildingsDepending on investments through economic recovery Chances in facility management

Communications Integrate remainder with other activities

Outlook 2004

Good prospects in environment

Restructuring strengthens Dutch competitive position

Net income from operations at level of 2003, excluding non-recurring charges

In 2004 non-recurring negative effect of € 1,5 million on net income

Measures are to have an effect on operating income of € 2 to 3 million as of 2005

ARCADIS better positioned for the coming years

infrastructure, environment, buildings

Part of a bigger picture