UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the month of April, 2006

Commission File Number 000-22628

ARCADIS N.V.

(Translation of registrant’s name into English)

Utrechtseweg 68

6812 AH Arnhem

The Netherlands

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):     

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):     

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- N/A

[ARCADIS LETTERHEAD]

Dear Shareholder:

On behalf of the Executive Board of ARCADIS N.V., I cordially invite you to attend the Annual General Meeting of Shareholders, which will be held on Wednesday, May 17, 2006 at 2:00 p.m. local time, at the office of ARCADIS N.V., located at Nieuwe Stationsstraat 10, in Arnhem, the Netherlands.

We look forward to your attendance at the annual meeting so that you can learn more about ARCADIS and become better acquainted with the members of our Supervisory Board and Executive Board. Accompanying this letter are the following documents: (1) our annual report for the year ended December 31, 2005, (2) an agenda for the annual meeting which describes the business to be transacted at the meeting, (3) the notice of the annual meeting, and (4) our proxy statement and a proxy card, which, together, provide information on the proposals to be voted upon by our shareholders at the annual meeting.

The Supervisory Board and Executive Board of ARCADIS unanimously recommend that shareholders vote “FOR” each of the proposals described in the proxy statement.

Your vote is very important, regardless of the number of shares you own. Whether or not you plan to attend the meeting, please complete, sign, date and return the enclosed proxy card in the enclosed postage-prepaid envelope at your earliest convenience so that your shares will be represented at the meeting. You may still attend the meeting if you return the proxy card. If you choose to attend the meeting, you may revoke your proxy and cast your votes in person. Please note that should you transfer ownership of the shares you voted by proxy prior to the meeting, your votes may be invalid under Netherlands law and may not be counted.

If you have any questions about the proxy statement, the annual report, or any other aspect of the annual meeting, please contact either Joost Slooten in the United States at (631) 391-5262, or Anja van Bergen-van Kruijsbergen in the Netherlands at
+31-26-377-8245.

Arnhem, The Netherlands

April 14, 2006

ARCADIS N.V.

AGENDA OF ANNUAL GENERAL MEETING OF SHAREHOLDERS

May 17, 2006

The Annual General Meeting of Shareholders of ARCADIS N.V. will be held at the office of ARCADIS N.V., located at Nieuwe Stationsstraat 10, in Arnhem, the Netherlands, on Wednesday, May 17, 2006, at 2:00 p.m. local time. Set forth below is an agenda for the business to be transacted at the annual meeting and the order in which these agenda items will be presented to our shareholders.

1.         Opening and Announcements

2.         Statement of the Supervisory Board for the year ended December 31, 2005

3.         Report of the Executive Board for the year ended December 31, 2005

4.         Annual Financial Statements for the year ended December 31, 2005

a.           Adoption of the 2005 Financial Statements of ARCADIS N.V.

b.           Adoption of a € 0.66 cash dividend payment per issued and outstanding common share

5.         Approval of the Annual Discharge of the Executive Board and the Supervisory Board

a.           Discharge of Executive Board members’ liability for management duties and responsibilities

b.           Discharge of Supervisory Board members’ liability for supervisory duties and responsibilities

6.         Assignment of Accountant for 2006

7.         Composition of the Executive Board

a.           Nominations for Executive Board Position Number One

b.           Nominations for Executive Board Position Number Two

8.         Composition of the Supervisory Board

a.           Re-appointment of Rijnhard W.F. Van Tets to the Supervisory Board

b.           Re-appointment of Carlos Espinosa de Los Monteros to the Supervisory Board

c.           Announcement of vacancies arising at the next Annual General Meeting of Shareholders

9.         Authorization to Issue Shares and Rights to Shares of ARCADIS’ Capital Stock

a.           Renewal of the authorization of the Supervisory Board to issue shares and rights to shares of ARCADIS’ capital stock

b.           Approval of limitations and exclusions applicable to pre-emptive rights

10.      Authorization of the Executive Board to Repurchase Shares of ARCADIS’ Capital Stock

11.      Questions and Answers

12.      Adjournment

Arnhem, April 14, 2006

The Executive Board

ARCADIS N.V.

P.O. Box 33

6800 LE Arnhem

The Netherlands

ARCADIS N.V.

NOTICE OF THE ANNUAL GENERAL MEETING OF SHAREHOLDERS

The Annual General Meeting of Shareholders of ARCADIS N.V. will be held on Wednesday,  May 17, 2006, at 2:00 p.m. local time, at the office of ARCADIS N.V., located at Nieuwe Stationsstraat 10, in Arnhem, the Netherlands. At the annual meeting, shareholders will be asked to consider and vote upon the following proposals:

1.     to adopt our financial statements for the year ended December 31, 2005 (Agenda Item 4a);

2.     to adopt a € 0.66 cash dividend payment per common share (Agenda Item 4b);

3.     to approve the annual discharge of our Executive Board (Agenda Item 5a);

4.     to approve the annual discharge of our Supervisory Board (Agenda Item 5b);

5.     to assign KPMG Accountants N.V. in Amstelveen to serve as our independent auditor for the fiscal year 2006 (Agenda Item 6);

6.     to appoint Friedrich Schneider to our Executive Board (Agenda Item 7a);

7.     to appoint Ben A. van der Klift to our Executive Board (Agenda Item 7b);

8.     to re-appoint Rijnhard W.F. Van Tets to serve as a member of our Supervisory Board (Agenda Item 8a);

9.     to re-appoint Carlos Espinosa de Los Monteros to serve as a member of our Supervisory Board (Agenda Item 8b);

10.   to approve the authorization of our Supervisory Board to issue shares, and rights to shares, of our capital stock (Agenda Item 9a);

11.   to approve limitations and exclusions applicable to certain pre-emptive rights (Agenda Item 9b); and

12.   to approve the authorization of our Executive Board to repurchase shares of our capital stock (Agenda Item 10).

Each of these proposals is more fully discussed in the proxy statement immediately following this notice.

Only shareholders of record of ARCADIS at the close of business on April 4, 2006 will be entitled to notice of the annual meeting and any adjournments thereof. Pursuant to our Articles of Association and Netherlands law, any person who is a shareholder on the date of our annual meeting is entitled to attend and vote at the meeting. Accordingly, the record date above serves only as a reference date in order to determine which shareholders are entitled to receive notice of the annual meeting. We will not close our transfer books. We will make available at the annual meeting a complete list of shareholders of record at the close of business on April 4, 2006, and on May 16, 2006, the day immediately preceding the annual meeting. If you wish to attend the annual meeting in person, you will be required to present

proper identification, proof that you are a shareholder of ARCADIS N.V., and proof of the number of shares you own on the day of the meeting.

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE MARK YOUR VOTE FOR EACH PROPOSAL AND COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED POSTAGE-PREPAID ENVELOPE AT YOUR EARLIEST CONVENIENCE SO THAT YOUR SHARES WILL BE REPRESENTED AT THE MEETING. YOU MAY STILL ATTEND THE MEETING IF YOU RETURN THE PROXY CARD. IF YOU CHOOSE TO ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND CAST YOUR VOTES IN PERSON. PLEASE NOTE THAT SHOULD YOU TRANSFER OWNERSHIP OF THE SHARES YOU VOTED BY PROXY PRIOR TO THE MEETING, YOUR VOTES MAY BE INVALID UNDER NETHERLANDS LAW AND MAY NOT BE COUNTED.

Arnhem, The Netherlands

April 14, 2006

ARCADIS N.V.

Nieuwe Stationsstraat 10

6811 KS Arnhem

The Netherlands

PROXY STATEMENT

For the Annual General Meeting of Shareholders to be held on May 17, 2006

INTRODUCTION

This proxy statement is furnished to the shareholders of ARCADIS N.V., a company organized and existing under the laws of the Kingdom of the Netherlands, in connection with the solicitation of proxies by our Executive Board for use at the 2006 Annual General Meeting of Shareholders. The annual meeting will be held on Wednesday, May 17, 2006, at 2:00 p.m. local time, at the offices of ARCADIS N.V., located at Nieuwe Stationsstraat 10, in Arnhem, the Netherlands. This proxy statement and the accompanying proxy card are first being mailed or given on or about April 14, 2006 to shareholders of record at the close of business on April 4, 2006.

Our principal executive offices are located at Nieuwe Stationsstraat 10, 6811 KS Arnhem, The Netherlands, and our telephone number at that address is 31-26-3778911. For further information about ARCADIS, you may wish to visit our website at www.arcadis-global.com (the contents of the website are not part of this proxy statement).

Information About this Proxy Statement

Some of the business items included on the agenda for the annual meeting include proposals to be voted upon by the holders of our common shares. We have sent you these proxy materials because our Executive Board is soliciting your proxy to vote your shares on the following proposals to be presented at the annual meeting:

Proposal 1:  to adopt our financial statements for the year ended December 31, 2005;

Proposal 2:  to adopt a € 0.66 cash dividend payment per common share;

Proposal 3:  to approve the annual discharge of our Executive Board;

Proposal 4:  to approve the annual discharge of our Supervisory Board;

Proposal 5:  to assign KPMG Accountants N.V. in Amstelveen to serve as our independent auditor for fiscal year 2006;

Proposal 6:  to appoint Friedrich Schneider to our Executive Board;

Proposal 7:  to appoint either Ben A. van der Klift (the Supervisory Board recommended nominee) or Anja M. van Bergen-van Kruijsbergen (the alternate nominee required by Netherlands law) to our Executive Board;

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Proposal 8:  to re-appoint Rijnhard W.F. Van Tets to serve as a member of our Supervisory Board;

Proposal 9:  to re-appoint Carlos Espinosa de Los Monteros to serve as a member of our Supervisory Board;

Proposal 10:  to approve the authorization of our Supervisory Board to issue shares, and rights to shares, of our capital stock;

Proposal 11:  to approve limitations and exclusions applicable to certain pre-emptive rights; and

Proposal 12:  to approve the authorization of our Executive Board to repurchase shares of our capital stock.

This proxy statement contains information that is designed to assist you in voting your shares on each of the above proposals. Neither the Executive Board nor the Supervisory Board knows of any other matters to be presented to the shareholders for a vote at the annual meeting.

Shareholders Entitled to Notice and to Vote

Only shareholders of record at the close of business on April 4, 2006, which we refer to as the record date, will be entitled to notice of the annual meeting. Pursuant to our Articles of Association and Netherlands law, any person who is a shareholder on the date of the annual meeting is entitled to attend and vote at the annual meeting. Accordingly, the record date serves only as a reference date in order to determine which shareholders are entitled to receive notice of the annual meeting.

On March 31, 2006, there were 20,645,615 common shares, € 0.05 nominal value, issued and outstanding and 200 priority shares, € 0.05 nominal value, issued and outstanding. Our Articles of Association also authorize us to issue shares of cumulative preferred stock, € 0.05 nominal value, and cumulative financing preferred stock, € 0.05 nominal value. On the record date, there were no shares of cumulative preferred stock or cumulative financing preferred stock issued and outstanding.

Notwithstanding the record date specified above, we will not close our transfer books and you may transfer any shares held by you subsequent to the record date. Please note that if you decide to transfer ownership of the shares you voted by proxy prior to the meeting, your votes may be invalid under Netherlands law and may not be counted.

If your shares are held in the name of a brokerage firm, bank nominee or other institution, only the institution may sign a proxy card with respect to your shares. Accordingly, please contact the person responsible for your account and provide your proxy card with instructions on how your shares should be voted at the meeting.

Voting Requirements

Each issued and outstanding common share represents the right to one vote at the annual meeting, regardless of whether the share is voted in person or by proxy card. Our Articles of Association do not impose a requirement that a quorum of shareholders be present or represented by proxy at the annual meeting in order for a vote to be taken on any of the proposals on the agenda for this year’s annual meeting. However, because our common shares are quoted on The Nasdaq Stock Market, or Nasdaq, the National Association of Securities Dealers, Inc., which governs those companies with shares quoted on Nasdaq, imposes a minimum quorum requirement on us. Accordingly, the holders of 33¹/₃% of the

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outstanding common shares entitled to vote at the annual meeting, who are present in person or represented by proxy, will constitute a quorum necessary to hold a valid meeting.

Pursuant to our Articles of Association, proposals adopted by the shareholders at the annual meeting must be passed by an absolute majority of the votes validly cast, unless our Articles of Association or Netherlands law requires a vote greater than that of the majority of votes cast. We have described below any proposal that requires more than an absolute majority of the votes cast in order to be adopted by the shareholders. Only votes cast by the shares represented and entitled to vote at the annual meeting will determine the adoption or rejection of a proposal and, therefore, abstentions and broker non-votes will have no effect on the actual voting. However, abstentions and broker non-votes will be counted as present for establishing the 33¹/₃% quorum requirement described above. A broker non-vote occurs when a broker votes on some matters on the proxy card but not on other matters because the broker does not have the authority to vote on those other matters.

Several of the proposals to be voted on at the annual meeting also will require the approval of the holder of our priority shares. All of our issued and outstanding priority shares are held by Stichting Prioriteit ARCADIS NV, a foundation. The board of Stichting Prioriteit has 20 members, 10 of whom are members of our Executive Board and Supervisory Board and the other 10 of whom are representatives elected by our employees. A 60% absolute majority of the members of the Stichting Prioriteit board is necessary in order for the Stichting Prioriteit board to approve any of the shareholder proposals in which a vote of the priority shares is required. We have described below any proposal that also will require the approval of the holder of the priority shares.

Proxies

The shares represented by a proxy card will be voted in accordance with the instructions indicated on the proxy card if:

•       the enclosed proxy card is fully and properly executed;

•       the proxy card is returned to us on time;

•       the proxy is not revoked prior to or at the annual meeting; and

•       the owner of the shares voting in accordance with the proxy has not transferred the shares prior to the annual meeting.

If no instructions are indicated on the proxy, your proxy will be voted “FOR” each of the proposals listed on the proxy card. All persons named as proxies on the enclosed proxy card are members of our Executive Board.

Any shareholder voting on a proxy card has the right to vote “FOR,” “AGAINST” or to “ABSTAIN” on a particular proposal by indicating as such on the proxy card. A shareholder who has returned a proxy card to us may revoke it at any time prior to the annual meeting by doing one of the following:

•      providing written notice of revocation to the Chairman of the Executive Board;

•      properly submitting a duly executed proxy card bearing a later date; or

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•      voting in person at the annual meeting.

If you wish to attend and vote at the annual meeting, you will be required to present proper identification, proof that you are a shareholder, and proof of the number of shares you own on the day of the annual meeting. All written notices of revocation of a proxy card should be sent to the following address: ARCADIS N.V., Nieuwe Stationsstraat 10, 6811 KS, Arnhem, the Netherlands, Attention: Harrie L.J. Noy, Chairman of the Executive Board.

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PROPOSAL 1

(Agenda Item 4a)

ADOPTION OF OUR FINANCIAL STATEMENTS FOR THE YEAR ENDED

DECEMBER 31, 2005

Our Articles of Association require that our books be closed annually, on each December 31, and that the Executive Board prepare our financial statements within five months of December 31. Our Articles of Association further require our independent certified public accountant to audit our annual financial statements and to prepare a report for the Executive Board and the Supervisory Board.

The Supervisory Board reviewed and approved the annual financial statements for the year ended December 31, 2005 at a meeting of the Supervisory Board held on March 3, 2006. A copy of the 2005 year-end financial statements is included in our annual report accompanying this proxy statement. The Supervisory Board recommends that our shareholders adopt our annual financial statements as presented in our annual report.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to adopt our 2005 financial statements.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 1

PROPOSAL 2

(Agenda Item 4b)

ADOPTION OF € 0.66 CASH DIVIDEND PAYMENT

PER COMMON SHARE

Our Articles of Association provide that, subject to the approval of the Supervisory Board, our Executive Board shall determine, on an annual basis, the amount of our profits that we will set aside as reserves, and also, the amount of our profits to be distributed to our shareholders in the form of a dividend payment. Our Articles of Association require that the shareholders adopt this dividend payment at the annual meeting.

Our Articles of Association provide that each year, to the extent possible, 5% of the nominal amount per priority share shall be distributed to the holders of the priority shares. Thereafter, no further distributions will be made on the priority shares. After the payment of dividends on the priority shares and the allocation of any remaining amount of our profit to the reserves, the Executive Board has proposed, and the Supervisory Board has approved, the payment of a dividend in the amount of € 0.66, in cash, per issued and outstanding common share. The Executive Board proposes to fix May 17, 2006 as the record date for payment of the dividend. Starting May 19, 2006, our common shares will be quoted ex-dividend and payment of the dividend will begin on May 31, 2006.

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Each year we attempt to ensure that the dividend payment proposed by the Executive Board conforms to the applicable statutory requirements under Netherlands law, as well as the policy of ARCADIS to distribute a dividend to our shareholders in an amount equal to 30% to 40% of the net profit from operations, excluding amortization of goodwill, as calculated in accordance with Netherlands law and regulations. This year, the proposed dividend payment of € 0.66 per common share is € 0.18 more than the 2004 dividend payment and equals approximately 40% of net income from operations. Our dividend policy aims to provide our shareholders with an attractive return on their investment while, at the same time, providing us with the cash necessary to finance further growth of our business. The Supervisory Board has discussed our current dividend policy with the Executive Board and, based on these discussions, has decided not to change our current dividend policy at this time.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to adopt the € 0.66 cash dividend payment per common share.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 2

PROPOSAL 3

(Agenda Item 5a)

APPROVAL OF THE ANNUAL DISCHARGE OF OUR EXECUTIVE BOARD

Our Articles of Association provide that we must present to the shareholders at the annual meeting a separate proposal asking our shareholders to grant a discharge of the Executive Board from liability for their management duties and responsibilities during the preceding financial year, to the extent that such liability is related to the financial statements for the year ended December 31, 2005 and the report given by the Executive Board at the annual meeting. After the Executive Board members are discharged by the shareholders, a member of the Executive Board cannot be held liable in any action or proceeding brought by a shareholder that is based upon our financial statements for the year ended December 31, 2005, as presented to, and adopted by, the shareholders at this annual meeting. However, this discharge would not protect members of the Executive Board if our financial statements were subsequently restated. The discharge is to be approved without prejudice to certain statutory provisions of The Netherlands Civil Code.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to grant a discharge of the Executive Board for their duties during the preceding financial year.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 3

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PROPOSAL 4

(Agenda Item 5b)

APPROVAL OF THE ANNUAL DISCHARGE OF OUR SUPERVISORY BOARD

Similarly to the discharge of our Executive Board, our Articles of Association provide that we must present to the shareholders at the annual meeting a separate proposal asking our shareholders to grant a discharge of the Supervisory Board from liability for their supervisory duties and responsibilities during the preceding financial year, to the extent such liability is related to the financial statements for the year ended December 31, 2005 and the report given by the Supervisory Board at the annual meeting. The discharge of the Supervisory Board members also means that a member of the Supervisory Board cannot be held liable in any action or proceeding brought by a shareholder that is based upon our financial statements for the year ended December 31, 2005, as presented to, and adopted by, the shareholders at this annual meeting. As with the discharge of our Executive Board members, the discharge would not protect members of the Supervisory Board if our financial statements were subsequently restated. The discharge is to be approved without prejudice to certain statutory provisions of The Netherlands Civil Code.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to grant a discharge of the Supervisory Board for their duties during the preceding financial year.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 4

PROPOSAL 5

(Agenda Item 6)

ASSIGNMENT OF KPMG ACCOUNTANTS N.V. TO SERVE AS OUR

INDEPENDENT AUDITOR FOR FISCAL YEAR 2006

Our Articles of Association provide that our shareholders are entitled to assign a registered accountant to audit our annual financial statements prepared by the Executive Board. The Audit Committee of our Supervisory Board recommended to our Supervisory Board that the Supervisory Board propose that our shareholders assign KPMG Accountants N.V. in Amstelveen to audit our financial statements for fiscal year 2006.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to assign KPMG Accountants N.V. in Amstelveen to audit our financial statements for the fiscal year 2006.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 5

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INFORMATION ABOUT OUR EXECUTIVE BOARD

General. ARCADIS is managed by an Executive Board which serves under the supervision of our Supervisory Board. According to our Articles of Association, the shareholders shall appoint members of the Executive Board who have been nominated by our Supervisory Board. Currently, Harrie L.J. Noy and C. Michiel Jaski serve as the members of our Executive Board. At a meeting held on December 15, 2005, our Supervisory Board determined that it was in the best interest of ARCADIS to expand the Executive Board to three members. The Supervisory Board determined to propose a binding nomination to appoint Friedrich Schneider to serve as the third member of our Executive Board with primary responsibility for operations in South America and Asia and also for strengthening the infrastructure business of the company. At a meeting of our Supervisory Board held on April 5, 2006, it was determined that it was in the best interest of ARCADIS to expand the Executive Board to four members. The Supervisory Board determined to propose a binding nomination to appoint Ben A. van der Klift to serve as the fourth member of our Executive Board in the function of Chief Financing Officer.

If the Supervisory Board makes a binding nomination of a member to our Executive Board, the shareholders at a general meeting may nevertheless overrule the binding nature of the nomination by a resolution adopted by at least two-thirds (66²/₃%) of the votes cast at the meeting, provided that the votes cast represent more than one-half (50%) of our issued share capital. A binding nomination means that the nomination was made within six months from the time a vacancy arises in the Executive Board and, for each appointment, a choice can be made from at least two persons. If the Supervisory Board makes a non-binding nomination, a simple majority of the votes represented at the meeting is required to approve the nomination. If a binding or non-binding nomination is not approved by the shareholders, the shareholders at a general meeting may appoint a candidate by a resolution adopted by at least two-thirds (66²/₃%) of the votes cast at the meeting, provided that the votes cast represent more than one-half (50%) of our issued share capital.

Dutch Corporate Governance Code. The Dutch Corporate Governance Code, or the Code, applies to all companies whose registered office is in the Netherlands and whose shares or depositary receipts for shares are officially listed on a stock exchange recognized by the Dutch government. The Code contains the principles of good corporate governance and concrete “best-practice” provisions governing the conduct of a company’s management, supervisory board members and shareholders.

In line with best practice provision II.1.1 of the Code, the new members of the Executive Board will be appointed for a maximum period of four years and may be re-appointed for a term of not more than four years. The terms of the employment agreements with the new Executive Board members will be consistent with the Executive Board remuneration policy adopted by our shareholders at the Annual General Meeting of Shareholders in May 2005. Lastly, in line with best practice provision II.2.7 of the Code, the maximum remuneration payable to a new executive Board member in the event of dismissal is equal to one year’s salary.

The Supervisory Board has made the binding nominations of Friedrich Schneider and Ben A. van der Klift in accordance with Article 12 of our Articles of Association.

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PROPOSAL 6

(Agenda Item 7a)

BINDING NOMINATION FOR EXECUTIVE BOARD POSITION NUMBER ONE;

FRIEDRICH SCHNEIDER

The Supervisory Board has approved a binding nomination of Friedrich Schneider to be appointed to serve as a member of our Executive Board. The Supervisory Board recommends that you vote your shares for Friedrich Schneider.

Friedrich Schneider, age 44, is a citizen of Germany. He will serve as a member of the Executive Board of ARCADIS with responsibilities for operations in South America and Asia and also for strengthening the infrastructure business of the company. He will also serve as a member of the ARCADIS Priority Foundation. Prior to joining ARCADIS, Mr. Schneider served on the Executive Board of Rheinhold & Mahla AG, an industrial services company, in Munich from 2004-2005 and was responsible for the Western Europe and Technologies Divisions. From 2001 until 2004, Mr. Schneider served as a managing director of Bilfinger Berger AG, first in the International Division (2001-2002) and then in the Civil Division (2002-2004). Mr. Schneider has also served in various capacities at Bentec GMBH Drilling and Oilfield Systems (1999-2001), Preussag AG 1996-1999), Preussag International GMBH (1993-1996), Metallgesellschaft Services (1990-1993). Mr. Schneider received a Masters of Art (Economics) at the State University of New York in Albany and a PhD in Economics from the European University Institute, Florence.

The Supervisory Board believes that Mr. Schneider should be appointed to our Executive Board because of his broad international experience in the field of civil construction and infrastructure projects worldwide, his experience in our industry in which he has held several management positions, and his ability to operate effectively in different cultures.

Mr. Schneider holds no shares or options of our capital stock.

Under Netherlands law, when the Supervisory Board makes a binding nomination, the shareholders must be presented with a choice of two candidates for the position. The Supervisory Board has determined to nominate Anja M. van Bergen-van Kruijsbergen as the alternate candidate.

Anja M. van Bergen-van Kruijsbergen, age 45, is a citizen of the Netherlands. She began her career at ING Bank in commercial finance (1984-1988). From 1988 until 1996 she served as the head of the legal department and special credit lines of Fortis Finance NV. She joined ARCADIS in 1996 and currently serves as our Company Secretary and general legal counsel.

Mrs. Van Bergen-Van Kruijsbergen holds 107 shares and 1,000 options of our capital stock.

The candidate who receives the most votes will be appointed to the Executive Board. Shareholders will have the option to vote their shares for either Mr. Schneider or Mrs. Van Bergen-Van Kruijsbergen.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE THEIR SHARES

“FOR” MR. SCHNEIDER IN PROPOSAL 6.

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PROPOSAL 7

(Agenda Item 7b)

BINDING NOMINATION FOR EXECUTIVE BOARD POSITION NUMBER TWO;

BEN A. VAN DER KLIFT

The Supervisory Board has approved a binding nomination of Ben A. van der Klift to be appointed to serve as a member of our Executive Board. The Supervisory Board recommends that you vote your shares for Ben A. van der Klift.

Ben A. van der Klift, age 46, is a citizen of the Netherlands. He will serve as a member of the Executive Board of ARCADIS and will serve as Chief Financial Officer. Mr. Van der Klift joined ARCADIS in January 2005 as Corporate Director Finance. Prior to joining ARCADIS, he served as Financial Director of PRC Bouwcentrum BV in Bodegraven from 1997-2005. From 1991-1997, Mr. Van der Klift served as Controller of DHV Milieu en Infrastructuur and DHV AIB. He began his career at De Rotterdamsche Droogdok Maatschappij in Rotterdam (1987-1991). Mr. Van der Klift received a degree in Social Geography at the University in Utrecht (1981-1984), a Master of Business Administration at the Erasmus University in Rotterdam (1984-1988) and the took courses for corporate controllers at ‘Vrije Universiteit Amsterdam’ (1989-1994).

The Supervisory Board believes that Mr. Van der Klift should be appointed to the Executive Board because of his long and broad financial experience in fields relevant to ARCADIS’ business.

Mr. Van der Klift holds 580 shares and 21,285 options of our capital stock.

Under Netherlands law, when the Supervisory Board makes a binding nomination, the shareholders must be presented with a choice of two candidates for the position. The Supervisory Board has determined to nominate Anja M. van Bergen-van Kruijsbergen as the alternate candidate.

Anja M. van Bergen-van Kruijsbergen, age 45, is a citizen of the Netherlands. She began her career at ING Bank in commercial finance (1984-1988). From 1988 until 1996 she served as the head of the legal department and special credit lines of Fortis Finance NV. She joined ARCADIS in 1996 and currently serves as our Company Secretary and general legal counsel.

Mrs. Van Bergen-Van Kruijsbergen holds 107 shares and 1,000 options of our capital stock.

The candidate who receives the most votes will be appointed to the Executive Board. Shareholders will have the option to vote their shares for either Mr. Van der Klift or Mrs. Van Bergen-Van Kruijsbergen.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE THEIR SHARES

“FOR” MR. VAN DER KLIFT IN PROPOSAL 7

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INFORMATION ABOUT OUR SUPERVISORY BOARD

Our Articles of Association provide that the Supervisory Board must consist of at least three individuals. Our current Supervisory Board is composed of seven individuals. The current members of our Supervisory Board include: Rijnhard W.F. Van Tets (Chairman), Ross A. Webber (Vice-Chairman), Thomas M. Cohn, Jan Peelen, Carlos Espinosa de Los Monteros, George R. Nethercutt, Jr., and Gerrit Ybema.

The Supervisory Board oversees the policies of the Executive Board and the general course of our business and related business enterprises. The members of the Supervisory Board are nominated by the Supervisory Board and are appointed to serve on the board for a period of four years. A member of the Supervisory Board must resign at the expiration of the four-year term. However, a resigning member also may choose to be re-appointed to the board. A Supervisory Board member is only eligible for reappointment to two additional four-year terms.

Pursuant to our Articles of Association, the members of the Supervisory Board are appointed by the shareholders at a general meeting from among the nominees selected by the Supervisory Board. The Supervisory Board must nominate a member to fill a vacancy on the Supervisory Board within six months following the occurrence of the vacancy. If the Supervisory Board has not nominated a member within this time period, then the shareholders may appoint a Supervisory Board member at a general meeting at their discretion.

If the Supervisory Board makes a binding nomination, the shareholders at a general meeting may nevertheless void the binding nature of the nomination by a resolution adopted by at least two-thirds (66²/₃%) of the votes cast at the meeting, provided that the votes cast represent more than one-third (33¹/₃%) of our issued share capital. A binding nomination means that the nomination was made within the six month prescribed time period and, for each appointment, a choice can be made from at least two persons. If the Supervisory Board makes a non-binding nomination, a simple majority of the votes represented at the meeting is required to approve the nomination. If a binding or non-binding nomination is not approved by the shareholders, the shareholders at a general meeting may appoint a candidate by a resolution adopted by at least two-thirds (66²/₃%) of the votes cast at the meeting, provided that the votes cast represent more than one-third (33¹/₃%) of our issued share capital.

In accordance with the schedule previously adopted by the Supervisory Board, three of its members, Messrs. Espinosa de los Monteros, Van Tets and Webber are scheduled to retire from the Supervisory Board at the close of this 2006 Annual General Meeting of Shareholders. Messrs. Van Tets and Espinosa de los Monteros are eligible for re-appointment following the expiration of their current terms at this Annual Meeting. Mr. Webber is not eligible for re-appointment to the Supervisory Board due to the term limits described above.

Messrs. Van Tets and Espinosa de Los Monteros have chosen to be eligible for re-appointed to our Supervisory Board. At a meeting held on March 3, 2006, the Supervisory Board approved the non-binding nominations of Messrs. Van Tets and Espinosa de Los Monteros to be re-appointed to our Supervisory Board, each to serve for an additional four-year term. Due to the retirement of Mr. Webber, our current Vice-Chairman, Mr. Espinosa de Los Monteros will be appointed as Vice Chairman of the Supervisory Board upon his re-appointment to the Supervisory Board following the 2006 Annual General Meeting of Shareholders. Following our annual meeting on May 17, 2006, our Supervisory Board will have six members. In accordance with the schedule adopted by the Supervisory Board, Mr. Ybema is scheduled to retire from the Supervisory Board at the close of the next Annual General Meeting of Shareholders to be held in 2007. Mr. Ybema is eligible for re-appointment following the expiration of his current term.

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PROPOSAL 8

(Agenda Item 8a)

RE-APPOINTMENT OF RIJNHARD W.F. VAN TETS TO OUR SUPERVISORY BOARD

The Supervisory Board has approved a non-binding nomination of Rijnhard W.F. Van Tets to be re-appointed to serve as a member of our Supervisory Board until our 2010 Annual General Meeting of Shareholders.

Rijnhard W.F. Van Tets, age 59, is of Dutch citizenship. Mr. Van Tets has served as a member of our Supervisory Board since 2002, and has served as the Chairman since 2004. Since 2002, he has also served as an advisor to the Executive Board of ABN AMRO Bank. Previously, he served in various capacities at Banque Europeene de Credit and Societe Generale (1973-1975), Sogen Swiss and First Boston Corporation (1975-1983), and ABN AMRO Bank (1988-2002). He also currently serves as a member of the Supervisory Boards of the following entities: Wegener N.V. (as Chairman), Equity Trust SARL (as Chairman), Euronext Amsterdam N.V., and International Flavors & Fragrances I.F.F. (The Netherlands) Holding B.V.

In addition, Mr. Van Tets currently serves as a member of the Audit Committee, the Selection and Remuneration Committee (as Chairman) and the Integrity Committee (as Chairman) of our Supervisory Board. Mr. Van Tets also qualifies as an independent member of the Supervisory Board as defined under the Sarbanes-Oxley Act and the Nasdaq independence rules adopted in the United States. Our Supervisory Board has determined that Mr. Van Tets qualifies as an “audit committee financial expert” under the rules and regulations of the United States Securities and Exchange Commission.

The Supervisory Board believes that Mr. Van Tets should be re-appointed to the Supervisory Board because of his knowledge and experience of financial and accounting aspects of international companies, as well as his service to the Supervisory Board as Chairman and as a member of the Audit Committee.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to re-appoint Mr. Van Tets to our Supervisory Board.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 8

PROPOSAL 9

(Agenda Item 8b)

RE-APPOINTMENT OF CARLOS ESPINOSA DE LOS MONTEROS

TO OUR SUPERVISORY BOARD

The Supervisory Board has approved a non-binding nomination of Carlos Espinosa de Los Monteros to be re-appointed to serve as a member of our Supervisory Board until our 2010 Annual General Meeting of Shareholders.

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Carlos Espinosa de Los Monteros, age 62, is a citizen of Spain. Currently, Mr. Espinosa de Los Monteros serves as a member of our Supervisory Board and has done so since 1998. Since 1990 he has served as the Chairman and Chief Executive Officer of Daimler Chrysler Espana. Prior to that, Mr. Espinosa de Los Monteros was the Chairman of IBERIA Airlines (1983-1985). He also currently serves as a member of the Supervisory Boards of the following entities: Gonzalez Byass S.A. (as Chairman), Acciona S.A., and Inditex S.A.

In addition, Mr. Espinosa de Los Monteros currently serves as a member of the Selection and Remuneration Committee of our Supervisory Board. Mr. Espinosa de Los Monteros also qualifies as an independent member of the Supervisory Board as defined by the Committee of Dutch Corporate Governance and under the Sarbanes-Oxley Act and the Nasdaq independence rules adopted in the United States.

The Supervisory Board believes that Mr. Espinosa de Los Monteros should be re-appointed to our Supervisory Board because of his broad international managerial experience and his knowledge of European markets, as well as his valuable contributions as a member of the Supervisory Board and the Selection and Remuneration Committee.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to re-appoint Mr. Espinosa de Los Monteros to our Supervisory Board.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 9

PROPOSAL 10

(Agenda Item 9a)

AUTHORIZATION OF THE SUPERVISORY BOARD TO ISSUE SHARES, AND

RIGHTS TO SHARES, OF CAPITAL STOCK FOR A PERIOD OF 18 MONTHS

Our Articles of Association provide that the shareholders have the exclusive authority to issue shares of our capital stock, unless the shareholders authorize the Supervisory Board to issue such shares. The shareholders may delegate their authority to issue shares to the Supervisory Board for a maximum period of up to five years and this delegation may be renewed for additional terms not to exceed five years per term. The holders of the priority shares and the holders of any other class of stock whose rights may be prejudiced by the issuance of the shares must approve the proposal to authorize the Supervisory Board to issue shares. At the annual general meeting of shareholders held on May 11, 2005, the shareholders renewed the Supervisory Board’s authority to issue shares of our capital stock for a period of 18 months commencing July 1, 2005.

Pursuant to our Articles of Association, the Executive Board and the Supervisory Board propose that the shareholders authorize the Supervisory Board, subject to the prior approval of Stichting Prioriteit ARCADIS NV, for a period of an additional 18 months commencing on July 1, 2006:

•      to issue shares, and rights to shares, of our common shares and cumulative financing preferred stock, up to an amount equal to 10% of the number of common shares and/or cumulative financing preferred stock issued and outstanding as of the date of the resolution adopted by the

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Supervisory Board to issue the shares, provided, however, that the amount of shares to be issued may be increased by an additional 10% when the issuance of shares relates to the consideration to be given in a merger or acquisition, and

•                  to issue shares, and rights to shares, of cumulative preferred stock, up to a maximum amount equal to 100% of our total capital stock issued and outstanding as of the date of the resolution adopted by the Supervisory Board to issue the shares of cumulative preferred stock.

The purpose of this proposal is to ensure that we are ready to act quickly in order to take advantage of appropriate opportunities to grow through mergers and acquisitions. In order to finance strategic transactions, it may be necessary for us to issue common shares or shares of cumulative financing preferred stock as consideration to any potential acquisition target. If we had to give notice of, and hold, a meeting of our shareholders in order to approve the issuance of stock, we might not be able to complete any merger or acquisition on a timely basis or we might lose strategic opportunities to other parties who could complete a potential transaction faster than us. We believe that giving the Supervisory Board the authority to issue shares of our capital stock for a period of 18 months will provide the Board with the time necessary to identify and complete appropriate acquisition opportunities and will give the board the flexibility necessary to determine the financing conditions of any potential transactions. Additionally, we may also need to issue shares of our capital stock in order to meet current obligations under our stock option plans.

In addition, in order to protect ARCADIS from any hostile takeover attempt by another entity, we propose that you authorize our Supervisory Board to issue shares of our cumulative preferred stock in an amount up to the total number of shares of our capital stock outstanding at the time the cumulative preferred stock is to be issued. These shares of cumulative preferred stock would only be issued to Stichting Preferente Aandelen ARCADIS NV, which we refer to as the ARCADIS Preferred Stock Foundation, under the limited circumstance that ARCADIS is threatened by a hostile takeover. The issuance of the cumulative preferred stock acts as a “poison pill” to deter any hostile takeover attempt of ARCADIS and, as a result, it is necessary for the Supervisory Board to act quickly in issuing these shares as soon as the interests of ARCADIS have been threatened by a potential acquiror.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to approve the authorization of our Supervisory Board to issue shares, and rights to shares, of our capital stock. In addition, the holder of our priority shares must approve this authorization of our Supervisory Board to issue shares, and rights to shares, of our capital stock.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 10

PROPOSAL 11

(Agenda Item 9b)

AUTHORIZATION OF THE SUPERVISORY BOARD TO LIMIT OR EXCLUDE

PRE-EMPTIVE RIGHTS FOR A PERIOD OF 18 MONTHS

Our Articles of Association provide that holders of common shares and cumulative financing preferred stock are entitled to a pro rata pre-emptive right of subscription for any issuance of common

14

shares or cumulative financing preferred stock for cash, unless such right is limited or excluded by the Supervisory Board. Shareholders have no pre-emptive rights with respect to any common shares or cumulative financing preferred stock issued for consideration other than cash or issued to any of our employees. The holders of shares of cumulative preferred stock or priority shares do not have pre-emptive rights.

If authorized by the shareholders, the Supervisory Board has the power to limit or exclude pre-emptive rights related to a particular issuance of common shares or cumulative financing preferred stock. This authorization of the Supervisory Board may be effective for up to five years and may be renewed for additional terms of five years. At the annual general meeting of shareholders held on May 11, 2005, the shareholders authorized the Supervisory Board to limit or exclude pre-emptive rights related to shares issued pursuant to the authority granted to the Supervisory Board at the May 11, 2005 meeting for a period of 18 months commencing on July 1, 2005.

The Executive Board and the Supervisory Board propose that the shareholders renew the authorization of the Supervisory Board to limit or exclude pre-emptive rights related to shares issued pursuant to the authority granted at the last annual general meeting of shareholders upon the issuance of any common shares or cumulative financing preferred stock for a period of an additional 18 months commencing on July 1, 2006.

We believe that the holders of our common shares should be able to participate, as much as possible, in any new issuance of our common shares. This participation may be accomplished through an exercise of pre-emptive rights during the statutory 14-day period under Netherlands law or, to the extent statutory pre-emptive rights have been excluded, by granting the existing shareholders a preference, under our Articles of Association, in the allocation of the issuance of any new shares. Shareholders do not have statutory pre-emptive rights, or rights under our Articles of Association, in the event that the issuance of new shares pertains to an acquisition to be financed by us with newly issued shares of our capital stock. To the extent we desire to pay the selling party in an acquisition with our common shares, we will limit our issuance of new stock to an amount equal to 20% of our capital stock issued and outstanding at the time of the issuance of the new shares.

However, shareholders would have statutory pre-emptive rights, and rights under our Articles of Association, if we were to use the cash proceeds of a new issuance of shares to pay the selling party in an acquisition the consideration in cash. Therefore, in order for us to take advantage of appropriate opportunities to acquire new businesses by using either shares of our capital stock or cash raised through issuances of our capital stock, we believe that it is necessary to exclude statutory pre-emptive rights and the rights under our Articles of Association upon any issuance of new shares when the cash proceeds of such issuance are to be used to finance an acquisition. We will limit the issuance of our stock to an amount equal to 20% of our capital stock issued and outstanding at the time of the issuance of the new shares. In addition, we will comply with Netherlands law and the rules of the various stock exchanges on which our shares are traded when we determine the price at which any new shares will be issued, when pre-emptive rights for those shares have been limited or excluded.

15

The approval of this Proposal 11 is conditioned on the approval of Proposal 10 regarding the authorization of our Supervisory Board to issue shares, and rights to shares, of our capital stock. If shareholders representing less than 50% of the issued and outstanding shares are represented at the meeting, the affirmative vote of the holders of two-thirds (66²/₃%) of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to approve the authorization our Supervisory Board to limit or exclude preemptive rights. However, if at least 50% of the issued and outstanding shares are represented at the annual meeting, then a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to approve the authorization our Supervisory Board to limit or exclude pre-emptive rights.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 11

PROPOSAL 12

(Agenda Item 10)

APPROVAL OF AUTHORIZATION OF OUR EXECUTIVE BOARD TO
REPURCHASE SHARES OF OUR CAPITAL STOCK

Our Articles of Association provide that our Executive Board may acquire fully paid-up shares of our capital stock if:

•                  the amount of our shareholders’ equity reduced by the amount paid for the repurchased shares is not less than the paid-up and issued portion of our share capital increased by the reserves maintained pursuant to Netherlands law, and

•                  the aggregate par value of the shares to be acquired and of the shares already held by us or any of our subsidiaries does not exceed one-tenth (1/10th) of the issued capital.

The repurchase of our shares by the Executive Board requires approval by the Supervisory Board and the holder of the priority shares. In addition, the shareholders must also authorize the Executive Board to repurchase shares and this authorization will be valid for a term not to exceed eighteen (18) months. Our Articles of Association further provide that the authorization to repurchase shares must specify the number of shares that may be repurchased, the manner in which they shall be acquired and the price ranges at which they may be repurchased. No authorization is required if we repurchase our shares in order to transfer the shares to our employees, such as under our employee stock option plans.

Pursuant to our Articles of Association, the Executive Board and the Supervisory Board propose that the shareholders authorize the Executive Board, for a period of 18 months commencing on July 1, 2006, to repurchase, in the discretion of the Executive Board, any and all of our paid-up shares of capital stock and any shares of cumulative financing preferred stock, up to the maximum amount authorized under applicable law and our Articles of Association.

We may purchase any and all paid-up shares of our capital stock on the public markets, or by other means such as a purchase directly from a holder of our shares, at a price per share between (1) the share’s nominal value (€ 0.05 per share) and (2) an amount equal to 10% above the average market price of such

16

shares on Euronext Amsterdam N.V. The market price shall be determined based on the average of the highest trading price per share of our capital stock, as published by the Official Prijscourant of Euronext Amsterdam N.V., for each of the 5 trading days immediately preceding the day of repurchase by us.

Shares of our cumulative financing preferred stock may be purchased at a price per share between (1) the share’s nominal value (€ 0.05 per share) and (2) the amount paid-up as nominal value and premium (agio), increased by the amount of profit which would have been distributed to the holders of shares of cumulative financing preferred stock upon redemption of such shares, in accordance with our Articles of Association.

The affirmative vote of the holders of a majority of the common shares present in person or represented by proxy and entitled to vote at the annual meeting is required to approve the authorization of our Executive Board to repurchase shares of our capital stock. In addition, the holder of our priority shares must approve this authorization of our Executive Board to repurchase shares of our capital stock.

THE EXECUTIVE BOARD AND THE SUPERVISORY BOARD

UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE

“FOR” PROPOSAL 12

17

OTHER MATTERS

The Executive Board and the Supervisory Board do not know of any other matter to be brought before the shareholders. If any other matters are properly brought before the shareholders at the annual meeting, the persons appointed as proxies will vote the shares represented thereby in accordance with their judgment.

List of Shareholders of Record

A list of shareholders of record entitled to receive notice of the annual meeting will be available at the offices of ARCADIS, Nieuwe Stationsstraat 10, 6811 KS, Arnhem, the Netherlands, for inspection by our shareholders during regular business hours from April 4, 2006 to the date of the annual meeting. A list of shareholders of record at the close of business on May 16, 2006, the day immediately preceding the annual meeting, will also be available during the annual meeting for inspection by shareholders who are present.

AVAILABILITY OF ANNUAL REPORT

ACCOMPANYING THIS PROXY STATEMENT IS A COPY OF OUR ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2005. SHAREHOLDERS WHO WISH TO RECEIVE ADDITIONAL COPIES OF THE ANNUAL REPORT SHOULD DIRECT THEIR REQUESTS TO: ARCADIS N.V., NIEUWE STATIONSSTRAAT 10, 6811 KS, ARNHEM, THE NETHERLANDS, ATTENTION: ANJA VAN BERGEN-VAN KRUIJSBERGEN; OR ARCADIS N.V. C/O ARCADIS G & M, INC., 88 DURYEA ROAD, MELVILLE, NEW YORK 11747, ATTENTION: JOOST SLOOTEN. OUR ANNUAL REPORT IS ALSO AVAILABLE ON THE COMPANY’S WEB SITE AT WWW.ARCADIS-GLOBAL.COM.

Arnhem, The Netherlands

April 14, 2006

18

19

Shape the future. Push boundaries. Develop.

A global network of business professionals creating benefits for communities and companies everywhere.

We drive progress by making complexity simple.

We give life to ideas.

Your success is our commitment.

Imagine the result.

ARCADIS NV

Nieuwe Stationsstraat 10, 6811 KS, Arnhem, The Netherlands

P.O. Box 33, 6800 LE, Arnhem, The Netherlands

Tel +31 26 3778911

Fax +31 26 4438381

E-mail ir@arcadis.nl

Internet www.arcadis-global.com

Chamber of Commerce Arnhem, The Netherlands Trade registry no. 09051284

BTW NL 0062.93.700.B.01

For other company addresses see page 128 of this report.

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Table of contents

This is a true and correct translation of the Dutch Annual Report 2005 of ARCADIS NV. If different interpretations regarding the contents arise, the Dutch version will prevail.

Safe Harbor Provision

Except for the historical information contained herein, the statements in this report are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to differ materially from forecasted results. Those risks include, among others, risks associated with possible changes in environmental legislation, changes in investment flow for infrastructure, changes in the investment climate for buildings, and more generally, risks related to the Company’s ability to acquire and execute projects. These and other risks are described in this annual report on page 74 and in ARCADIS’ filings with the Securities and Exchange Commission (SEC) over the last 12 months, copies of which are available from the SEC or may be obtained upon request from the Company, and on the Company’s website.

21

Highlights 2005

Net income from operations_40% increase (before amortization and non-recurring items)

Gross revenue_11% increase to more than € 1 billion

Organic growth_5%: in line with goal

Margin goal achieved for the first time_margin improved to 8.2% versus 6.2% in 2004 (on recurring basis)

Portfolio changed considerably_activities with lower margins replaced with consultancy and management services with more added value and higher margins

Acquisition of Blasland, Bouck & Lee in the United States_propels ARCADIS into the global top 5 in the environmental market

Acquisition of AYH in the United Kingdom_strengthens position in the facilities market with project management services

Environment main growth market_with organic growth of 10% mainly from the United States

Infrastructure market positive_with ongoing growth in Belgium, France, Poland and the United States and a strong increase in Brazil

Strong margin improvement in facilities_reflects transition to project management and facility management

Market in the Netherlands slowly improving_restructuring yields the intended profit improvement

Transnational Growth Platforms established_drive stronger growth in rail, tunnels and bridges, environment, and project and program management

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Selected financial data

(1)          Exchange rate - balance sheet data US$ 1.00 = € 0.84767 (December 31, 2005); - income data US$ 1.00 = € 0.76273 (1st quarter), € 0.79291 (2nd quarter), € 0.81987 (3rd quarter) and € 0.84172 (4th quarter); - 2005 dividend data: US$ 1.00 = € 0.83215 (March 6, 2006).

(2)          Net income excluding amortization and non-recurring items

(3)          The headcount includes the total number of employees of proportionally consolidated companies

Amounts in thousands of euros unless otherwise stated

The 2003 and prior financial data are not adjusted to comply with the International Financial Reporting Standards (IFRS). For an explanation of the significant differences between Dutch Generally Accepted Accounting Principles and IFRS, please refer to note 15.

23

The ARCADIS share

Stock exchange listings

ARCADIS shares are listed on the Euronext Amsterdam (ARCAD) and on the NASDAQ Stock Market (ARCAF). On the Euronext Amsterdam Exchange, two liquidity providers are active in the ARCADIS share: ABN AMRO Bank and Rabo Securities. In March 2006, the ARCADIS share became part of the Amsterdam Small Cap Index (AScX) of Euronext.

Investor Relations

ARCADIS has an active investor relations policy aimed at keeping existing and potential shareholders–institutional as well as private–well informed about the strategy and recent developments in the Company. ARCADIS follows a quarterly reporting cycle for its financials and, in addition, informs the market through press releases on important developments and positioning project wins. Twice a year, at the presentation of the annual and semi-annual results, ARCADIS organizes a financial press conference and analyst meeting, which are broadcast live over the internet. At the presentation of the first and third quarter results, a conference call is held for financial analysts, also accessible through a live audio link through the ARCADIS website.

Annual General Meeting of Shareholders

The Annual General Meeting of Shareholders is scheduled for May 17, 2006 at 2:00 p.m. and will be held at the Company headquarters in the Rijntoren building in Arnhem, the Netherlands. The agenda for this meeting will be available on April 14, 2006 upon request from the Company and can be found on the Company’s website (www.arcadis-global.com).

Historic development of the number of outstanding shares

Dividend

It is proposed that the 2005 cash dividend be € 0.66 per share, compared to € 0.48 for 2004. This equals 40% of net income from operations. ARCADIS’ dividend policy is to recommend payment of an annual dividend ranging from 30% to 40% of net income from operations.

Share price development

On the first trading day of 2005, the share price on the Euronext was € 13.68, while the year closed at € 26.80, an increase of 96%. In 2005, the Dutch AEX Index increased 24%, while the Mid-Cap Index rose by 26%. In 2005, the ARCADIS share opened on the NASDAQ at a price of US$18.389 and closed year-end 2005 at US$31.600, an increase of 72%. On the NASDAQ, the index rose 2%.

Price per share on the Euronext Amsterdam NV

Price per share on the NASDAQ

Liquidity

The liquidity of ARCADIS shares strongly improved in 2005, making the share profile more attractive for institutional investors. The average daily trading volume on Euronext in 2005 was 31,395 shares and was considerably higher than the average daily volume of 17,900 shares in 2004. On the NASDAQ, liquidity in the ARCADIS share was also higher. The

24

The ARCADIS share

average daily volume in 2005 increased to 7,300 shares, compared to 5,600 shares in 2004.

Data per share in €

(1) Proposed dividend

(2) Not adjusted for IFRS

Peer group

To benchmark its performance, ARCADIS has selected a group of peer companies. This group consists of international, public companies in the consulting and engineering industry with activities and a size comparable to ARCADIS. This peer group includes the following companies: Grontmij NV, Euronext Exchange WS Atkins plc, London Stock Exchange Jaakko Pöyry Group Oyj., Helsinki Stock Exchange TRC Companies, Inc., New York Stock Exchange Tetra Tech, Inc., NASDAQ Stock Market URS Corporation, New York Stock Exchange Sweco AB, The Nordic Exchange, Stockholm Alten SA, Euronext Paris WSP Group plc., London Stock Exchange

Ownership information

Under the Disclosure of Major Holdings in Listed Companies Act, we received the following notifications of the status of capital interest:

•         Stichting Lovinklaan 21.3%

(in the Company register year-end 2005)

•         Vereniging KNHM 6.2%

(in the Company register year-end 2005)

•         Fortis NV 6.0%

(situation end 2005)

•         Delta Deelnemingen Fonds 5.4%

(situation end 2005)

•         First Eagle Funds 4.9%

(notification January 31, 2006)

•         Smoorenburg BV 3.1%

(notification December 23, 2005)

Financial calendar (tentative)

May 9, 2006_First quarter 2006 results Conference call (live webcast)

May 17, 2006_Annual General Meeting of Shareholders

May 19, 2006_Ex-dividend quotation

May 31, 2006_Dividend payment date

August 9, 2006_Second quarter 2006 results Press conference (morning – live webcast) Financial analyst meeting (afternoon – live webcast)

November 15, 2006_Third quarter 2006 results Conference call (live webcast)

Contact information

For general information about ARCADIS, please visit our

website. Or you may call or email Investor Relations:

Joost Slooten, phone: +31 26 377 8604;

email: j.slooten@arcadis.nl

Evelien Hamelink, phone: +31 26 377 8337;

email: e.a.hamelink@arcadis.nl

Copies of the Company’s 2005 Dutch and English language Annual Reports and the Company’s 2005 Form 20-F as filed with the Securities and Exchange Commission in the United States can be ordered at no charge through our website www.arcadis-global.com/investors or by phone: +31 26 377 8355; U.S. investors, please dial: +1 631 391 5262.

Advisors

Investor Relations Financial Dynamics, United States Rematch, The Netherlands

Independent auditors KPMG Accountants N.V., The Netherlands

Fiscal Counsel KPMG Meijburg & Co, The Netherlands

Legal Counsel De Brauw Blackstone Westbroek, The Netherlands

Alston & Bird, United States

Registrar and common stock transfer agent

Euronext Amsterdam:

ABN AMRO Bank, The Netherlands

NASDAQ Stock Market:

Bank of New York, United States

25

Profile

ARCADIS is an international company that delivers consulting, engineering and project management services for infrastructure, environment and facilities. Focused on mobility, sustainability and quality of life. Companies and governments benefit daily from the proficiency, professionalism and dedication of our people. We are committed to their success. We understand the challenges of our clients, and we truly deliver value. To provide tailor-made services. ARCADIS ranks third in Europe and seventh in the world. We have home market positions in Europe, the United States and South America and know the local conditions. Local presence, combined with extensive experience and fresh perspectives, enables us to offer unique integrated solutions. From feasibility studies, design, engineering, project and process management to implementation and maintenance, as well as associated legal and financial services. Creative but practical and feasible solutions. Think and act. We have a clear vision on developments in society and work together with our clients to redefine the realities of today. To be prepared for the future. ARCADIS looks ahead. Imagines. Develops. Delivers results.

26

27

Executive Board_Harrie Noy, Chairman, Ben van der Klift (appointee), Friedrich Schneider (appointee), Michiel Jaski (from right to left)

28

Introduction

ARCADIS has delivered an excellent performance in 2005. Our net income from operations rose 40% to the highest level ever. Gross revenue rose 11% and surpassed the one billion euro threshold. Organic growth was 5%, in line with our goal. The acquisitions of Blasland, Bouck & Lee (BBL) in the United States and AYH in the United Kingdom have strengthened our strategic positioning. And last but not least, for the first time, we achieved our margin goal of 8%.

The portfolio was drastically changed. Activities with lower margins were replaced by consultancy and management services with more added value and higher margins. Against the sale of some € 100 million in revenue stood the addition of almost € 200 million through acquisitions. With BBL, we entered the global top 5 in the environmental market and are now the market leader in environmental services to companies. AYH has strengthened our position in the facilities market with project and program management.

Environment was the most significant growth market. Specifically, U.S. activities saw strong growth, among other things, as a result of the success of GRiP®. In Europe, interest in this remediation program for contaminated sites is growing. More and more multinational companies want to do business with international service providers. This offers us many opportunities.

In the infrastructure market, a solid performance was achieved in most European countries, the United States and particularly Brazil. In the Netherlands, the market is slowly recovering, while the restructuring of 2004 led to profit improvement. In the facilities market, the transition to management services drove organic growth and margin improvement.

ARCADIS is an ambitious Company. From a position in the center of society, we want to help our clients achieve their goals. We do so with zeal, because results count: Imagine the result. Imagination and pushing boundaries are the basis for creative solutions. That is how we contribute to the quality of the human habitat and to accessibility, sustainability, safety, flexibility and attraction. These are themes that matter and that can be found throughout this report.

Our strategy, aimed at profitable growth in home markets, has been sharpened further. For the three markets in which we operate, we have formulated clear goals. ARCADIS is well positioned, and market conditions are favorable. The outlook for 2006 is positive.

At ARCADIS, people make the difference. The solid results of the past year are attributable to the dedication and involvement of many. That is why a word of thanks goes out to our employees. Their enthusiasm, entrepreneurialism and client focus are the basis for the success of our Company.

On behalf of the Executive Board,

Harrie L.J. Noy, Chief Executive Officer

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Accessibility

Tailor-made access

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The challenge Turn an old, late 1950s 4- to 6-lane highway that lacks capacity and requires improved safety features into an effective thoroughfare for truck and commuter traffic. Meanwhile, upgrade the surroundings, reduce lighting spill-over and improve water quality.

The approach Starting in 2004, ARCADIS performed environmental studies, public involvement activities and preliminary engineering for this major project with an estimate construction cost of US$ 150 million. Coordinating the work of several other engineering, geotechnical and environmental consultants, ARCADIS designed and detailed the widening of the highway to a 6- and
8-lane facility with upgraded shoulders. The 11.5-mile section of State Route 2 (LAK-2), also known as the Lakeland Freeway, for which ARCADIS is responsible, includes 20 mainline bridges, 10 overhead bridges, 25 culverts, and seven interchanges. By developing a sequential closure plan, the highway could be kept open during construction and congestion could be avoided.

The result A smooth and safe transition with sufficient capacity and accessibility, while contributing to the local economy.

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Report by the Executive Board_Vision and strategy

The ARCADIS vision

Providing insight and counsel. Helping customers realize their goals. Ever cognizant of the future. Looking ahead, leading the way, pushing boundaries. This is ARCADIS’ goal. In markets that matter — infrastructure, environment and facilities. Facilitating mobility, sustainability, safety, flexibility and attraction. Doing business based on the values of tomorrow. By offering services that contribute to the quality of the human habitat — project management, consulting and engineering services. For companies and governments. Worldwide.

Following are the key elements of ARCADIS’ vision:

We are strongly client focused. We work hard to understand our clients’ goals and provide solutions that help them realize their goals. Solutions with added value. Solutions that can be implemented because of our knowledge of the local environments in which they operate.

Offer our clients nothing but the best

To achieve this, we strive for strong home market positions in the countries in which we operate. Our close-knit network of offices allows us to maintain close relationships with our clients and provides the adeptness to understand local conditions. Strong home market positions means belonging to the top five. This enhances our reputation and helps us win projects and attract and retain qualified staff.

Our international presence makes us eminently qualified to deliver services to multinational companies. These clients have an increasing need for service providers such as ARCADIS who can deliver services of consistent quality in a multitude of countries. We are committed to more fully understanding these companies and their production processes so that we can truly add value.

Clients want integrated total business solutions for their problems. That is why we strive to offer our clients one-stop shopping from our broad range of services. Combining our strong local positions with expertise and experience at the international level, we are capable of offering clients unique integrated solutions.

Worldwide, we strive to operate as one integrated entity, and therefore, we use the one firm concept. This makes us recognizable to clients. Internal synergy and cooperation are important priorities that allow us to offer our clients nothing but the best. We apply core values - integrity, entrepreneurship, agility - which are anchored on the ARCADIS General Business Principles. This promotes cohesion while respecting cultural differences.

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Our employees are the key to our success. Their knowledge, entrepreneurship, results-oriented project management and involvement are the basis for the combination of thinking and acting that distinguish ARCADIS (Imagine the result). Coaching and developing employees therefore plays an important role in Company policy.

Attracting, retaining and developing qualified staff, combined with providing added value to clients, are the basis for profitable growth. In this way, we create value for shareholders who are willing to invest in the Company. In turn, this creates continuity that is in the interest of all stakeholders.

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Market trends

ARCADIS operates in markets with growth potential. As demonstrated by our 2005 results, we are able to capitalize on this growth. Our markets are also influenced by economic cycles, as well as the willingness of companies and governments to invest. But in the longer run, demand for our services is increasing. This results from the following market trends:

The quality of the human habitat is an important theme. Large portions of the world’s population live in densely populated delta regions. These areas are vulnerable to the forces of nature. To ensure good living conditions, greater demands are being placed on infrastructure and environmental management. Climate change will add to these demands.

Mobility and urbanization are important drivers for the infrastructure market. Demand for mobility is increasing. Many governments are aware of the need for infrastructure investment to stimulate economic growth. Increasing urbanization also demands investments in living areas, commercial properties and other facilities. Inner city redevelopment is needed to enhance the attractiveness of cities.

Sustainability is another important global theme. It emphasizes the designing of our surroundings in such a way that the earth remains livable for future generations. This is an important driver for growth in the environmental market.

Improving safety and health is another global priority, creating higher demands on the human habitat. It is also an issue that affects our Company. The safety and health of our employees is a corporate priority.

Water issues are increasing in importance. Recent floodings underscore the need for adequate protection against the ravages of water. Climate change increases the urgency for solutions. The availability of clean, potable water sources is a recurring theme in the projects on which we work. Water management and water supply are, therefore, growth markets.

The expansion of the European Union creates strong growth in investments by governments and companies in Central Europe. In addition, Asia exhibits strong growth potential because of investments by international companies.

Globalization of industry continues, and international companies increasingly seek service providers who can provide strong service offerings internationally. In part, this market is the result of laws and regulations requiring companies to valuate their liabilities according to unified standards.

More and more, companies are concentrating on core activities. Non-core functions are outsourced. A comparable trend is apparent in government, where governmental agencies are focusing on policy making while leaving the implementation of these policy plans to companies like ARCADIS (privatization).

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In a growing number of countries, public services are provided through private-sector investment. This leads to an increase in the number of Design, Build, Finance and Operate projects, in which a consortium of private parties develops, designs and builds facilities, as well as provide financing and operational management for a fixed period.

Demand for risk participation is increasing. An increasing number of clients are asking us to share in project risk. Our fee will then be determined by the added value we deliver.

More added value and higher margins

Strategic developments in 2005

Since mid-2000, the ARCADIS strategy has focused on profitable growth in home markets in Europe and North and South America by stimulating organic growth, improving margins and expanding activities through acquisitions. Excellent progress was made in all of these areas in 2005.

Improved strategic positioning

In 2005, we further adjusted our portfolio. Activities with limited added value and lower margins were sold and replaced by consultancy and management services that generate higher added value and considerably higher margins. Against the sale of roughly € 100 million in gross revenue stood the addition of almost € 200 million through acquisitions. The most important acquisitions include Blasland, Bouck & Lee, Inc. (BBL) in the United States and AYH plc in the United Kingdom. With BBL, ARCADIS gains a leading position in the environmental market, while AYH fits the transition occurring in the facilities service area from engineering to management services. Both companies are active in growth markets, have considerably higher margins than the ARCADIS average and offer abundant opportunities for synergy. These acquisitions have changed ARCADIS’ profile and serve to strengthen the Company’s strategic positioning.

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Solid organic growth

Our organic growth goal of 5% was achieved in 2005. In line with the strategy, synergy was instrumental in the realization of that growth goal: synergy created by applying (specialized) knowledge and synergy created by capitalizing on solid client relationships. A good example of synergy based on specialized knowledge is the application of French expertise in a large tunneling project in Detroit, which opened up the American tunneling market for us. Synergy through client relationships is the goal of our Multinational Clients Program. In 2005, the number of global accounts under this program was expanded to 15.

Margin goal achieved

When our new strategy was introduced in 2000, a margin goal of 8% (EBITA as % of net revenue) was set. This goal was achieved for the first time in 2005. The margin (on a recurring basis) rose from 6.2% in 2004 to 8.2% in 2005, a margin improvement of more than 30%. Three factors have contributed to this improvement: acquisitions/divestments in which less profitable activities were replaced by higher margin activities, the positive effects of the restructuring in the Netherlands in 2004 and increased utilization rates combined with favorable market conditions.

Acquisitions: strong contribution to growth

In 2005, the following divestments and acquisitions were completed:

1) Based on 100%; gross revenue was consolidated 50%, the number of employees for 100%.

Divestments In light of the transition in the facilities service area to activities with higher added value, the detailed engineering activities for buildings in the United States was sold. With no prospect of gaining majority participation, we sold our 50% interest in Grupo EP to management and employees who already owned the other 50%. The company was consolidated proportionally for 50% in the ARCADIS figures and in 2004 contributed less than 5% to the ARCADIS net income from operations. Our good relationship, however, continues through a cooperation agreement. At the

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end of June, our interest in two smaller companies with activities in the donor-financed market was sold.

Expansion through acquisitions With the acquisition of SWK, Belgian activities were strengthened geographically, as well as in heavy infrastructure. The acquisition of AYH in the United Kingdom, specializing in project management, cost control and consultancy for real estate projects, fits the transition occurring in the facilities service area and strengthens our position in the United Kingdom. Greystone is an important addition to the American environmental market, bringing expertise particularly in permitting. Blasland, Bouck & Lee, specializing in environmental services and soil remediation, considerably strengthens our position in the environmental market, not only in the United States, but globally.

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The acquisitions are in line with targeted financial criteria:

•                  They are accretive to earnings per share.

•                  The margin is the same or higher than the ARCADIS margin.

•                  The return on investment (IRR) is 15% or higher.

Revised strategy

The biennial review of our strategy was completed in mid-2005. The revised strategy, titled Choices for growth, continues the course of profitable growth in home markets, which was introduced in mid-2000. The revised strategy introduces a strategic vision for each of the three service areas in which ARCADIS is active. This vision is based on a portfolio analysis by service area in which market attractiveness and ARCADIS’ competitive position were weighed for each activity. In addition, an analysis of strengths and weaknesses was completed by service area and for ARCADIS as a whole. The following table provides the analysis results for ARCADIS as a whole.

Goals by service area were formulated for the next three to five years. The goals were translated into tangible plans for goal realization. As part of this process, Transnational Growth Platforms were initiated, aimed at bundling the strengths of

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the Company in areas where the market offers good prospects and where ARCADIS is strong. These areas are rail, tunnels and bridges, environment and worldwide project consulting. This process strengthens the horizontal lines in the Company, offering prospects for additional growth in specific sectors. Further details are provided in the following sections on service areas.

The three core elements of the revised strategy can be summarized as follows:

Strengthening organic growth in the three service areas by:

•                  Using Transnational Growth Platforms for specific sectors;

•                  Expanding local positions in home markets; and

•                  Promoting innovations aimed at developing new products and services.

Continually improving margin by:

•                  Focusing on services with higher added value; and

•                  Outsourcing detailed engineering.

Expanding through acquisitions aimed at:

•                  Strengthening home markets and/or adding specific expertise; and

•                  Building a position in Asia.

Financial goals

ARCADIS maintains the following unchanged financial goals for the mid to long term:

•                  Gross revenue: average annual growth of 10% or more, half of which is organic.

•                  Operational margin: 8% (EBITA as a percentage of net revenue).

•                  Earnings per share: average annual growth of 10% or more.

•                  Return on invested capital of 15% or more. This is net income from operations, excluding interest charges, compared to shareholders’ equity plus net interest bearing debt, calculated as an average over four quarters.

The goals listed above are excluding the effects of currency exchange rate differences. Net income from operations is before amortization and non-recurring items like book gains. Goodwill is capitalized on the balance sheet as of 2001.

Below are the results of previous years compared to the above goals, excluding currency effects.

1) Excluding book profit on sales

2) Excluding non-recurring items

3) Figures based on IFRS

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Results and Financing

Good performance across the board

Record year ARCADIS’ excellent results made 2005 a record year. Gross revenue rose 11%, and for the first time, the Company surpassed the € 1 billion threshold. Net income from operations (before amortization and non-recurring items) rose 40% to € 33.4 million. Per share, this was € 1.65 compared to € 1.18 in 2004. This record achievement resulted from organic growth, a considerable margin improvement and a solid contribution from acquisitions. Across the board, performance was good. In the infrastructure market, the Dutch market saw a gradual recovery; Brazil experienced very strong activity growth, while growth also continued in Belgium, France and the United States. In the environmental market, we again achieved high organic growth, particularly in the United States, while the acquisition of BBL has strengthened our position in the global environmental market. In the market for facilities, the transition to activities with higher added value, in part through the acquisition of AYH, resulted in a considerable margin increase.

Dividend € 0.66 per share A cash dividend of € 0.66 per share is proposed. This dividend represents 40% of net income from operations and an increase of 37.5% compared to 2004 when € 0.48 per share was distributed. ARCADIS’ dividend policy is to recommend a payout ratio ranging from 30% to 40% of net income from

operations. The dividend policy is designed to provide an attractive dividend yield to shareholders, while leaving the Company sufficient resources to finance growth, among other things, by expansion through acquisitions.

Gross revenue rises above € 1 billion Gross revenue rose 11% to € 1,001 million (2004: € 901 million). Excluding a currency effect of 1%, gross revenue rose 10%. Of this growth, on balance 5% resulted from acquisitions and divestments. Organic growth totaled 5%. These percentages are in line with our annual growth goal of 10%, 5% of which should be organic. The largest contributions to organic growth came from the United States, Brazil, France and Belgium.

Net revenue increases 11% Net revenue, the part of sales produced by the Company’s own employees, rose 11% to € 703 million (2004: € 633 million). Excluding currency effect, growth was 10%. The contribution from acquisitions and divestments on balance was 6%. Organic growth, as in gross revenue, totaled 5%. Compared to 2004, there was a lower revenue inflow from the sale of activities, which resulted in a 1% decrease in net revenue.

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Geographic distribution shifts As of 2005, the geographic distribution of revenue has been altered slightly. The activities in North and South America were separated into two segments: the United States has become its own segment, while South America was added to the Rest of world segment. Strong expansion through acquisitions and relatively high organic growth are driving the increase in the U.S. percentage of total Company sales. In 2005, 35% of the gross revenue was generated in the United States (2004: 30%); the Netherlands contributed 29% (2004: 33%); Other European Countries, 26% (2004: 28%) and the Rest of world, 10% (2004: 9%).

The 2005 fourth quarter is indicative of the effect recent acquisitions have on annual revenue distribution. In the 2005 fourth quarter, the United States contributed 41% of

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the gross revenue; the Netherlands, 26%; Other European Countries, 24% and the Rest of world, 9%. Approximately 50% of ARCADIS sales are generated in Europe with the other 50% from the United States and the Rest of world.

Environment share is increasing The distribution by service area is also shifting. In the 2005 fourth quarter, 45% of gross revenue came from infrastructure (2005: 53%; 2004: 56%), 37% from environment (2005: 29%; 2004: 27%) and 18% from facilities (2005: 18%; 2004: 16%). Although infrastructure revenue is declining, environment revenue is increasing, resulting in a more balanced distribution over the service areas.

Non-recurring income effects In 2005 and 2004, the following non-recurring items affected income:

In 2004, a number of non-core activities were sold in the Netherlands, and a restructuring charge was taken to adjust the organization to market changes. The 2005 book gain is the result of a number of divestments, particularly the sale of our 50% interest in Grupo EP. Adjustments to Dutch pension plans also had non-recurring effects on results. Among other things, this concerns the adjustment of the PRC pension plan that, at year-end 2005, classifies as a defined contribution plan. For a further explanation, please refer to notes 9 and 10 of the financial statements.

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Development of cost Operational costs increased by 8% to € 628 million (2004: €581 million). On balance, acquisitions and divestments contributed 5% to the increase, while the currency effect resulted in an increase of 1%. The organic increase was 2%, clearly lower than the increase in net revenue, mostly due to improvements in staff utilization.

Depreciation decreases Depreciation (excluding amortization) decreased 3% to €15.2 million (2004: € 15.6) and totaled 2.2% (2004: 2.5%) of net revenue. The project management and consultancy companies that have been acquired are less capital intensive and require even less depreciation than the other ARCADIS operating companies, thus explaining the decrease in depreciation.

Amortization of identifiable intangible assets rises sharply Under IFRS, identifiable intangible assets related to acquisitions must be separated from goodwill and amortized separately. For ARCADIS, this is generally related to the profit in the acquired company’s backlog. These assets are amortized over their economic lifetime (on average one to two years). In 2005, the amortization increased sharply to € 6.0 million (2004: € 0.4 million) as a result of acquisitions.

Strong increase in operating income and EBITA Operating income increased 53% to € 54.4 million (2004: € 35.5 million). EBITA (operating income before amortization) and EBITA on a recurring basis were calculated as follows:

EBITA rose 68%, on a recurring basis by 47%. The currency effect was 3% and was predominantly caused by the increase of the Brazilian Real. The contribution from acquisitions and divestments on balance was 24%, considerably higher than the contribution to revenue growth (5%), underscoring the positive margin effect. Organically, EBITA rose 20%, also markedly more than revenue (5%). Margins also improved organically, in part as a result of the restructuring measures in the Netherlands.

Financing charges lower through the effect of derivatives Financing charges were impacted positively by € 1.7 million from financial derivatives used to cover currency and interest risks. Excluding this effect, financing charges rose to € 3.6 million (2004: € 3.5 million). The increase was limited as a result of the gains from divested assets and a further improvement of working capital throughout the year. In 2005, initial steps were taken to improve the Company’s financing structure in order to reduce interest charges as much as possible.

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Cash flow rose considerably

Tax rate slightly higher The 33.0% tax rate was slightly higher than the 32.4% of 2004. In 2004, a higher tax-free book gain was realized from the sale of activities than was realized in 2005. This offset the effect of a decrease in the Dutch and United States corporate tax rates.

Contribution of non-consolidated companies limited; minority interest sharply higher The contribution from non-consolidated companies declined from € 2.4 million in 2004 to € 1.4 million in 2005. This was the result of the completion of a number of energy-sector contracts in Brazil. Meanwhile, a new contract for one of the projects was signed, contributing to 2005 fourth quarter profits.

Minority interest - the part of the profit that flows back to the co-owners of less-than 100%-owned ARCADIS companies - rose 65% to € 3.2 million. This was mainly the result of a strong profit increase in Brazil where ARCADIS has a 50.01% ownership.

Net income and net income from operations sharply higher Net income totaled €33.4 million or € 1.65 per share, against € 22.2 million, or € 1.10 per share in 2004. Net income includes a gain of € 1.2 million from financial derivatives. This effect is not included in net income from operations. Net income from operations (before amortization and non-recurring items) was € 33.4 million, 40% higher than the € 23.8 million in 2004. Per share, this was € 1.65 against € 1.18 in 2004.

Solid cash flow Cash flow, defined as net income plus depreciation (including amortization), rose considerably, totaling € 54.6 million (2004: € 38.2 million). Working capital needs could be further reduced. As a result, cash flow from operational activities was € 66.8 million (2004: € 44.8 million). After subtracting replacement investments, cash flow totaled € 51.8 million (2004: € 33.0 million).

Investments considerably higher through acquisitions Investments in (in)tangible fixed assets, excluding acquisitions, were € 14.9 million (2004: € 11.8 million), equivalent to the level of depreciation. The investments primarily relate to communications and computer equipment.

The expansion of the Company through acquisitions required considerable investment for a total amount of € 121.3 million. Net of cash this was € 101.8 million, including €26.8 million that constitutes a withholding for a possible performance-based after payment to former AYH shareholders and the retention of part of the purchase price of BBL to cover possible BBL warranties. Goodwill amounted to € 61.3 million, while the value of identifiable intangible assets was € 11.5 million.

In addition, € 5.9 million was invested in non-consolidated companies and other financial fixed assets (2004: € 2.5 million). Divestments of consolidated companies yielded € 15 million; after taxes: € 8.5 million (2004: € 8.0 million), of which € 2.5 million represents book gains.

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Number of outstanding shares remains almost unchanged The number of outstanding shares at year-end 2005 was 20.3 million, remaining nearly unchanged from year-end 2004. To cover obligations related to option plans, approximately 332,000 shares were repurchased, while approximately 303,000 shares that had been purchased earlier were used for the exercising of options by employees. No new shares were issued. The average number of shares outstanding (as applied to calculate income per share) was 20.3 million (2004: 20.1 million). For more information on the development of outstanding shares, please refer to page 4, and for information on option plans, please see page 126 of this report.

Balance sheet remains healthy The balance sheet was strongly influenced in 2005 by acquisitions completed during the year. The balance sheet total rose from € 442 million at year-end 2004 to € 650 million at 2005 year end. Of this increase, € 100

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million resulted from obligations related to the acquisition of companies, € 43 million from consolidation and deconsolidation of subsidiaries, € 22 million from currency exchange rate differences and the remainder from Company growth.

Acquisitions and currency exchange rate differences resulted in an increase in goodwill on the balance sheet to € 116.0 million (2004: € 50.0 million). Identifiable intangible assets at year-end 2005 were € 8.3 million (2004 € 2.5 million). These assets are amortized over their economic lifetime - one to two years. As of 2004, goodwill is not amortized but subject to an impairment test once a year. In 2005, the Company reviewed goodwill assets and determined that no impairment loss had occurred.

Working capital, consisting of work in progress plus accounts receivable minus accounts payable, was further reduced. As a percentage of gross revenue (measured at the level of the fourth quarter times four), working capital declined from 13.3% in 2004 to 12.7% in 2005.

Cash at year-end 2005 was € 73.9 million (€ 2004: € 48.2 million). Net debt (cash minus interest-bearing debt) at year-end 2005 was € 52.2 million, against a net cash position of € 5.8 million in 2004. The increase in debt was mainly the result of loans secured to finance the acquisition of BBL in the United States. Interest-bearing debt also includes the remaining liabilities to the former shareholders of AYH and BBL, totaling €26.8 million.

At year-end 2005, € 258 million in short-term credit facilities was available (2004: €172 million). At the balance sheet date, € 2.1 million of these facilities were used. In addition, banks have pledged project bonds for € 40.0 million. At year-end 2005, ARCADIS’ long-term debt totaled € 116 million (2004: € 13 million). Short-term debt increased from € 244 million in 2004 to € 304 million in 2005. Of this increase, € 51 million was the result of shorter billing cycles. Another € 9 million resulted from acquisitions and € 9 million from currency exchange rate differences.

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Shareholders’ equity rose by € 39.8 million to € 176.2 million at year-end 2005 as follows:

The balance sheet ratios remained strong. The net debt to equity ratio at year end was 0.3 (2004: 0.1). The net debt to EBITDA ratio was 0.6 (2004: - 0.1). The interest coverage ratio was 17 (2004: 10).