* Net profit down to 102.7 million euros
* Revenue up 5.4 percent but margins deteriorate
* Sees H2 net comparable to H1
* Order book at end-June 3 billion euros
* Shares up 11.6 percent, at nine-month high
(Adds CEO, analyst comments, shares, recasts throughout)
By Greg Roumeliotis
AMSTERDAM, Aug 20 (Reuters) - Dutch dredging group Koninklijke Boskalis Westminster NV on Thursday reported better-than-expected first-half results even as it battles with declining demand in the sector, lifting its shares to a nine-month high.
Boskalis, the world's largest dredger, said revenue was up 5.4 percent to 989 million euros ($1.40 billion), buoyed by its dredging and earthmoving division at home and its maritime infrastructure unit, but this did not translate into a better bottom line.
Net profit fell 49.1 percent to 102.7 million euros. Analysts polled by Reuters had expected, on average, a net profit of 98 million euros on 923 million euros of revenue.
Last year's net profit was boosted by 92 million euros through non-recurring income, exacerbating the drop in the bottom line.
Boskalis shares, up 11.6 percent at 20.9 euros by 0836 GMT at the highest level since December, were the biggest gainer in the Amsterdam blue chip index
Dredgers have in the last years benefited from a rise in world trade and population as well as expanding energy consumption, but the recent global recession has led to falling commodity prices and trade, reducing demand for their services.
"It is owing to this strong order book that we continue to have a positive outlook on the rest of 2009. The outlook for the period thereafter is less clear," Chief Executive Peter Berdowski said in a statement.
The company, which has a 50 percent stake in marine services firm Lamnalco and a 40 percent stake in construction company Archirodon, said it expected net profit for the second half to be comparable to the first half and overall investment in 2009 to amount to 300 million euros.
FLEET RESTRUCTURING
Although Boskalis said that utilisation rates for its hopper and cutter fleet were high, it said it would engage in a rationalisation programme in order to improve its margins and allow it to be selective in bidding for projects.
"Can we keep the vessels well-utilised on a profitable base is what we are looking at right now," Berdowski said in a conference call, adding that of the ships in the firm's 300-vessel fleet he was looking to possibly withdraw "more than a hand-full" and "not just a few vessels here and there". The order book at the end of June stood at 3 billion euros, down from 3.35 billion euros at the end of 2008.
Net order intake in the first half totalled 622 million euros and included a harbour project in Gijon, Spain, an offshore project in Magellan, Argentina and several coastal defence schemes in the Netherlands and Benin.
"Since there are fewer cherries to be picked, the profitability in the dredging & earthmoving activities is lower than last year with an EBIT margin of 11.8 percent versus 15 percent," Petercam analyst Bart van den Wijngaard said.
Boskalis had to deduct 70 million euros from its order book after deeming the future of the 477 million euro Thessaloniki submerged tunnel in Greece uncertain.
"The Thessaloniki tunnel project involves a very complex political situation and we find it prudent not to keep in it our order book further," Berdowski said. (Editing by Karen Foster and Rupert Winchester)