Case Study: Delta Coastal Services

Delta Coastal Services operates in the offshore industry and is growing rapidly by winning major projects. After partnering with NoviCap, they are able to finance this growth and look to the future. This case study highlights our partnership.

Case Study: DCS
Delta Coastal Services B.V. (DCS) is a young company that has specialized in providing both wet and dry support for dredging and earthmoving activities. From the port of Vlissingen, DCS serves a wide range of clients through survey work, tender services and wind farm support. DCS also specializes in providing support for dredging and coastal reinforcement, among other things.

Increased working capital needs due to growth
In recent years, DCS has grown rapidly by successfully winning more and larger contracts. As a result, the working capital requirement has increased proportionally. For example, DCS won the mandate to execute projects off the coast of Ameland and Vlieland for its client Van Oord. To meet the working capital requirement for this assignment, the search was launched for a suitable partner to finance these new projects, which are often paid in partial invoices and only after 45 days.

Current bank facility not sufficient
An increase in the existing bank facility for this project was unfortunately not possible. This put DCS in contact with Hans van Dienst of Credion Zeeland and an alternative was immediately sought. Because of its different way of financing, NoviCap was quickly found. By cooperating well with the house bank of DCS, NoviCap was able to offer an add-on facility of €400,000 on top of the existing bank credit. This allows DCS to continue to grow.

Hans van Dienst, Credion Zeeland: "Typical case of being in the right place at the right time. At the time, NoviCap and I had coincidentally just had an introductory meeting when DCS approached us with this question. The contact I subsequently had with NoviCap revealed that it does not necessarily state that installment payments cannot be advanced. NoviCap really looks at the specific arrangements made in the agreement with the client. This distinguishes NoviCap in a very positive way and they definitely offer added value in the market. Another advantage of NoviCap is that they are willing to cooperate with the bank and thus can leave an additional credit line".

Jeffrey Geene, controller at DCS: "We work a lot on a project basis where partial invoices are the norm and a final settlement often takes place towards the end of the project. This method of invoicing scares off many factoring companies because of possible settlements that may take place. NoviCap handles this differently and was willing to finance a number of our debtors to facilitate a €400,000 line of credit, giving us a better working capital position and allowing us to continue growing with new projects without problems. In addition, NoviCap offers attractive interest rates and the generous credit limits allow us to continue to grow in the future."

NoviCap focuses on financing large and creditworthy debtors, such as Van Oord. NoviCap also requests a payment confirmation from the debtor for each invoice, which enables them to issue high limits in combination with very competitive rates. Partly because of these payment confirmations, partial invoices of projects and any final settlements are no problem.

The future of DCS with NoviCap
After a successfully funded project, DCS dragged in a second project which again created a higher funding requirement. The existing facility with NoviCap could easily be increased, allowing this project too to be taken on and executed. Going forward, the line of credit will continue to grow along with DCS as they execute more projects at home and abroad.

The benefits of NoviCap
NoviCap has proven to be the perfect financing partner for companies in a variety of industries and stands out in several ways. Some of NoviCap's advantages include:

• Project financing with partial installments and final settlements is not a problem
• Wide advance of average 90%
• High limits, which grow with the business
• Financing in addition to existing bank credit possible
• Attractive interest rates starting at 0.3% per 30 days
• Funding within 48 hours of debtor confirmation