HOCHTIEF: First-half results well up on prior year
Essen, Duitsland – HOCHTIEF continued its gratifying first-quarter trend through the second quarter of 2005. Its results for the entire first half, too, are well up on the prior year. Operating earnings, at EUR 168.0 million, more than doubled the corresponding prior-year figure of EUR 82.7 million. Profit before taxes climbed from EUR 81.5 million to EUR 149.0 million. Consolidated net profit likewise improved sharply, at EUR 44.4 million versus EUR 18.0 million in the first half of 2004. All divisions – though first and foremost HOCHTIEF Asia Pacific, which almost doubled earnings from the prior-year period – contributed to this healthy trend. This means HOCHTIEF can confirm the profit forecast it revised upward in early May, and delivers further proof that HOCHTIEFâ€™s long-term, value-oriented strategy is successfully proving itself in the market.
New orders worth EUR 3,786.2 million during the second quarter (up 34.9 percent from the first quarter) produced a new record order backlog of EUR 20,374.9 million.
“As the excellent market response shows, our full portfolio of services from a single source is the perfect fit for client needs. HOCHTIEF spans the entire project value chain,” says Dr. Hans-Peter Keitel, Chairman of the Executive Board. With this service portfolio, he explains, HOCHTIEF successfully differentiates itself from the competition exactly where the growth is – as evidenced by the concessions business and integrated facility management – and has built an outstanding base from which to forge ahead with the profitable development of its activities.
The public-private partnership (PPP) contracting model has also proved a great success with considerable growth potential. A total of EUR 650 million in PPP contracts have been secured in Germany since October 2004. HOCHTIEF gained entry into the UK PPP market – Europeâ€™s largest – in July 2005 with a contract for the Wright Robinson Sports College in Manchester. The Group is currently preferred bidder in three further tenders in the UK and Ireland.
Central and Eastern Europe also offers outstanding prospects for HOCHTIEF. The market trend there is positively influenced, among other factors, by increasing inflows of EU funds. Following the purchase of a majority stake in Hungarian builder MÃ©lyepÃtÃ¶, HOCHTIEF further enlarged its market presence in the second quarter by expanding its existing operations in Austria and setting up a new business unit in Bulgaria.
Based on the healthy business performance in the first six months and allowing for the traditional relative strength of the second quarter, HOCHTIEF has reaffirmed its forecasts made in early May and expects for the 2005 fiscal year:
– A high level of new orders as measured in euros, although not quite at the exceptional level attained in 2004.
– An order backlog in the same order of magnitude as the 2004 record.
– Sales at prior-year levels.
HOCHTIEF expects to attain growth in profit before taxes by about one-quarter and an increase in consolidated net profit by more than half in 2005 compared with the prior year.
The Group forecast is based on the assumption that there will be no significant change in the economic or fiscal operating environment.