CDLR

Cadeler A/S Form 20-F Summary: Fiscal Year Ended December 31, 2024

Business Context and Reporting Period

This filing is an Annual Report on Form 20-F for Cadeler A/S, a Danish public limited company incorporated in Copenhagen. The report covers the fiscal year ended December 31, 2024. Cadeler is a leading offshore wind farm vessel contractor specializing in the transportation and installation of wind turbine generators and foundations. The company operates a fleet of six vessels (O-Class, S-Class, Z-Class, P-Class, and M-Class) and has five newbuilds under construction. The financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) and presented in Euros (EUR).

Key Financial Metrics

Note: The significant increase in revenue and profit in 2024 is partly attributable to the consolidation of Eneti Inc. following the business combination completed in December 2023.

Material Changes vs. Prior Period

• Revenue Growth: Revenue more than doubled to EUR 248.7 million from EUR 108.6 million, driven by increased vessel utilization and the inclusion of Eneti's operations.
• Profitability Surge: Net profit increased to EUR 65.1 million from EUR 11.5 million. Adjusted EBITDA rose to EUR 125.9 million, reflecting operational synergies and higher throughput.
• Capital Expenditure: Investing cash outflows surged to EUR 615.7 million (from EUR 54.7 million) due to large asset investments, including final installments for the Wind Peak (P-Class), crane upgrades for O-Class vessels, and payments for newbuilds.
• Debt Expansion: Total debt increased to EUR 571.0 million to finance new vessel deliveries and upgrades. The company utilized new facilities including the P-Class Facility and refinanced the M-Class Facility.
• Backlog Expansion: The contract backlog grew to EUR 2.3 billion (including options), up from EUR 1.7 billion, with EUR 1.9 billion in firm contracted days.

Guidance, Outlook, and Risks

Outlook and Management Commentary: Management expects strong underlying demand for offshore wind installation services. The company is on track to realize synergies from the Eneti business combination, having already achieved at least EUR 30 million in cost and operational synergies. The company plans to deliver the second P-Class vessel imminently, the first M-Class vessel in Q4 2025, and three A-Class vessels between late 2025 and mid-2027.

Key Risks and Contingencies:

• Vessel Availability: The fleet is limited; any vessel being taken out of operation (e.g., for maintenance or accidents) significantly impacts revenue. The O-Class vessels were off-hire for six months in 2024 for crane upgrades.
• Newbuild Delivery Risks: Delays in the delivery of newbuilds from shipyards (COSCO in China, Hanwha in Korea) could trigger liquidated damages and delay revenue. Geopolitical tensions and U.S. designations of Chinese shipyards pose potential risks.
• Financing and Covenants: The company carries significant indebtedness with restrictive covenants regarding liquidity, equity ratios, and working capital. Failure to meet these could trigger debt acceleration.
• Internal Controls: Material weaknesses in internal controls identified in 2023 were remediated by December 31, 2024, but the company notes ongoing risks related to maintaining effective controls.
• Market Competition: Increased supply of installation vessels from competitors could pressure day rates.

Investor Verification Checklist

• Backlog Realization: Verify the conversion rate of "option days" (EUR 430 million) in the backlog to firm revenue, as these are at the discretion of customers.
• Newbuild Delivery Schedule: Monitor the delivery timelines for the P-Class, M-Class, and A-Class vessels, particularly given the geopolitical risks associated with Chinese shipyards (COSCO).
• Debt Covenant Compliance: Review quarterly reports to ensure continued compliance with minimum liquidity and equity ratio covenants, especially as new debt facilities are drawn down.
• Capital Expenditure Funding: Confirm the availability of financing for the remaining EUR 1.4 billion in estimated capital expenditures for newbuilds, as the company may need to raise additional equity or debt.
• Internal Control Effectiveness: Monitor future filings for any recurrence of material weaknesses in internal controls over financial reporting.