Report of the Supervisory Board

The economic crisis and its potential impact on businesses active in the port of Rotterdam has been a subject of attention and concern at every meeting. We have followed with satisfaction the way in which the Executive Board, by developing and monitoring many scenarios, keeping its finger on the pulse regarding the situation among its customers and monitoring closely the operating income and ratios, has responded to the crisis. Following on from the above, there have been discussions on the timing of investments (delay some, but pursue others on a countercyclical basis). In addition, we support the agreed reduction of the burden for the port business sector through the one-off crisis discount for 2010. The investments being planned for the coming years can be achieved thanks to stable operational cash flows, supplemented with external finance that has already been agreed.

The intended investment in Maasvlakte 2 has been continued vigorously. We have of course closely followed and evaluated the Maasvlakte 2 development. Since the start of construction in September 2008, we have watched Maasvlakte 2 grow throughout 2009. Halfway through the year the first land emerged permanently above sea level and in November the link was made to the existing Maasvlakte. A number of projects and subprojects are also making good progress or have already been completed, so that the entire Maasvlakte 2 project is progressing according to plan. The project organisation is functioning well; this was confirmed once again by the internal audit department. During the past year we have monitored market developments closely and included them in the business case, which we discussed at length at the end of the year. At the end of 2009 the final permits and the zoning plan were finalised. Construction work has now been underway for more than a year, and the project is still firmly on track.

The Executive Board has drawn up the Financial Statements for 2009. The net income for 2009 was € 167.4 million, of which € 23.2 million is exceptional income. Based on the existing agreements with the shareholders, € 61.1 million of this will be paid out as dividend for 2009. We agreed to the Executive Board’s proposal to pay out an interim dividend for 2009 of € 31.2 million to the shareholders on October 15.
On 2 March the Financial Statements, provided with an unqualified auditor’s report by Ernst & Young, were signed by the Executive and Supervisory Boards of the Port Authority. We have approved the Financial Statements and recommend that they be adopted by the General Meeting of Shareholders.

The Supervisory Board held five meetings during the year. Aside from the usual investments and the subjects already described above, potential cooperation with other ports was a subject of discussion. We also began consideration of a new business model as the basis for a new business plan to be drawn up next year. Finally, we were kept regularly updated on all kinds of existing and new developments, including the new western cross-river connection, the real estate portfolio, remuneration policy, foreign policy, rail policy and expected future developments in the chemical industry. Following our annual self-evaluation - in the absence of the executive board - it was agreed that in future this will be undertaken in a more structured way based on questionnaires.

The composition of the Supervisory Board remained unchanged in 2009. All its members are independent within the meaning of the Corporate Governance Code.

 

• A.J. Scheepbouwer; Chairman of the board, member of Remuneration Committee
• R.J.N. Abrahamsen; Vice-Chairman of the board, chairman of Audit Committee
• J.M. Kroon MBA; member of Audit Committee
• R.P.M. van Slobbe; member of Audit Committee
• R.M. Smit; Chairman of Remuneration Committee

In March 2009 Mr J.M. Kroon was re-elected with effect from 22 June 2009 and Mr A.J. Scheepbouwer with effect from 6 September 2009 by the General Meeting of Shareholders for a period of 4 years. In October 2009 Mr R.P.M. van Slobbe was re-elected with effect from 1 January 2010 by the General Meeting of Shareholders for a period of 4 years.

The Supervisory Board has two advisory committees: the Audit Committee and the Remuneration Committee.
The Audit Committee met three times in 2009. Subjects discussed included the 2008 Annual Report and Financial Statements, the quarterly reports and the financing of the Port Authority. The Audit Committee also gave its attention to risk management, project control, corporate governance and procurement.
The Remuneration Committee met twice in 2009. Regular subjects discussed during these meetings were the organisation of the Port Authority, the succession to the Executive Board and an assessment of the members of the Executive Board. A point of attention was the remuneration policy due to the policy frameworks being developed by the Ministry of Finance on remuneration in state participations. The re-election of two Supervisory Directors and the CFO was also discussed.

 

A member of our Supervisory Board was present on one occasion at a meeting of the Works Council. We observed that the Works Council makes a positive contribution to the Port Authority and appreciate very much the commitment shown by the Works Council.

We would like to compliment the Executive Board and all the staff of the Port Authority for the results they have achieved in 2009. We have seen during the past year how their commitment, expertise and involvement has increased further, for which we wish to express our appreciation and thanks. Given the current circumstances, our ability to work together in this way gives us every confidence for the future!

 

Port of Rotterdam Authority .
2 March 2010

 

The Supervisory Board
A.J. Scheepbouwer
R.J.N. Abrahamsen
J.M. Kroon MBA
R.P.M. van Slobbe
R.M. Smit