STRABAG SE Annual Report 2010
STRABAG SE: EXCEEDS ITS TARGETS IN THE FINANCIAL YEAR 2010- Revenue more or less stable; EBIT with € 299 million (+6 %) higher than expected
- Earnings per share show a plus of 8 % to € 1.53 – Management Board proposes a dividend per share of € 0.55
- Cautiously optimistic outlook confirmed
Vienna, 28 April 2011 The publicly listed construction company STRABAG SE exceeded its own earnings targets in the financial year 2010 and is still cautiously optimistic for the future.
A number of factors influenced the business, resulting in development in opposing directions so that STRABAG registered only a slight decline in the 2010 financial year with an output volume of € 12,777.00 million. The construction boom in Poland had a positive effect and, above all in the Transportation Infrastructures segment, made up for the disadvantageous weather conditions in Europe at the beginning of the year. In comparison, considerable declines in output volume were seen in the Transportation Infrastructures segment in Germany and Hungary. Due to the weather, the output volume in the Building Construction & Civil Engineering segment in Germany was also considerably below the level of the previous year. These burdens, in combination with the lack of orders in tunnelling, had a greater effect than did the boost received from new large-scale projects in Northern Europe and internationally.
“In 2010 we were surprised twice, one time positively and one time negatively: On the one hand, construction related spending from the economic stimulus programmes was stopped earlier than expected or not passed at all, instead being replaced by austerity packages to help slow the national debt. On the other hand, unexpectedly strong demand for construction services from private clients and project developers was registered in the home market of Germany”, Hans Peter Haselsteiner, CEO of STRABAG SE, commented.
The consolidated group revenue for the 2010 financial year stood at € 12,381.54 million, which corresponds to a decline of 1 %. The earnings before interest, taxes, depreciation and amortisation (EBITDA) grew by 7 % to € 734.69 million, resulting in a higher EBITDA margin, rising from 5.5 % to 5.9 %. The earnings before interest and taxes (EBIT) were 6 % higher at € 298.95 million. This resulted in an EBIT margin of 2.4 %, after 2.3 % the previous year. A positive one-off resulting from the consolidation of an acquisition in the amount of € 10.60 million is included in this figure. Therefore, the adjusted EBIT stood at € 288.35 million, being higher than the disclosed earnings target of € 280 million.
The profit before tax grew by 6 % to € 279.27 million. The net income was € 188.38 million, which corresponds to a plus of 2 % over the previous year. The net income after minorities is calculated at € 174.86 million, 8 % above the level from the year before. The number of weighted outstanding shares remained unchanged at 114,000,000 shares, so that the earnings per share also grew by 8 % to € 1.53. The Management Board will propose a dividend per share of € 0.55 to the Annual General Meeting on 10 June 2011 – an increase by 10 % compared to last year.
STRABAG SE’s balance sheet total increased by more than € 700 million to € 10,382.16 million, due in large part to an advance payment for a project in Poland and thanks to higher non-current and current provisions. Given the higher balance sheet total, the equity ratio fell slightly from 32.2 % to 31.1 %. As in the years before, STRABAG ended the year with a net cash position. Reaching € 669.04 million on 31 December 2010, this figure again grew in a year-on-year comparison.
The cash-flow from operating activities fell significantly in the past financial year by 38 % to € 690.42 million. This decline is due to the extraordinarily high basis of the previous year, when a higher-than-average reduction of the working capital was achieved. The cash-flow from investing activities increased by one fifth to € -523.56 million. The cash-flow from financing activities, at € -20.20 million, was far less negative than in the year before, as the company opted against a large-scale reduction of bank liabilities and instead decided to borrow more funds.
Outlook
In the past financial year, the European construction sector benefited from the state economic stimulus programmes that provided investments for public-sector infrastructure projects such as the construction of roads and educational facilities. As the stimulus programmes were replaced by austerity packages at the end of the year, as was the case in STRABAG ’s home market of Germany, the Building Construction & Civil Engineering segment, which relies mainly on private clients, will be of greater importance in the future.
This again shows the advantages of the STRABAG strategy. The geographical diversification of the activities and the broad product portfolio help compensate for the slowdown in certain markets through stronger engagement in other, more successful markets. To further diversify the business and spread the risk, STRABAG is expanding its activities in property and facility management as well as in niche markets such as railway and waterway construction.
STRABAG has already communicated its financial targets for the coming years during the Capital Markets Day in November 2010 and confirms its cautiously optimistic outlook. In 2011 the output volume is expected to reach € 13.5 billion, and in 2012 it could grow to € 13.7 billion. STRABAG forecasts the EBIT margin calculated on output volume in the next years at 2.2 %, which corresponds to an EBIT of € 295 million in 2011 and € 300 million in 2012.
A recording of the conference call is now available (until 5 May 2011). Please dial one of the following numbers and enter the code 5 1 9 0 2 #.
+49 (0) 69 710 488 70 (Germany)
+44 (0) 121 260 4861 (UK)
+1 (1) 866 268 1947 (US)
+43 (0) 125 302 1400 (Austria)
+43 (0) 800 102 519 70 (Austria Toll Free)