H1 shows firm 9% sales and profit growth and a solid net cash position // Over 25% increase in new orders driven by high-tech infrastructure projects // Guidance confirmed

• Operational net profit EUR 270 million, +8% year on year (yoy); nominal net profit EUR 262 million, +9%
  • Sales up 9% yoy at EUR 13.0 billion (+11% f/x-adj.), driven by all divisions
  • Solid operational net profit margin of 2.1%, stable yoy
• Strong Q2 2023 cash flow from operating activities pre-factoring of EUR 676 million, up EUR 100 million yoy
• Net cash position of EUR 346 million, up EUR 381 million yoy
• Strong growth in new orders of 26% to 18.1 billion
  • Several important new projects in structural growth markets secured corresponding to 50% of total
  • Order backlog of EUR 53.6 billion, up EUR 1.2 billion or +8% f/x-adj. yoy
• Guidance FY 2023 confirmed: operational net profit of EUR 510–550 million

HOCHTIEF has achieved a robust performance during the first half of 2023 with higher sales and profits, strong growth in new orders and a solid net cash position at the end of June. “This reflects our strategy to further strengthen HOCHTIEF’s position in its core markets whilst at the same time pursuing selective growth opportunities in the rapidly expanding areas of high-tech, energy transition and digital infrastructure markets. Already 50% of our new orders were secured in structural growth markets,” said CEO Juan Santamaría.

Sales increased by 9% during the first six months of the year to EUR 13.0 billion and nominal net profit of EUR 262 million was also 9% higher year on year. HOCHTIEF’s operational net profit for the period rose by 8% to EUR 270 million.

During the second quarter, cash flow from operating activities pre-factoring showed a strong performance, increasing by over EUR 100 million year on year to EUR 676 million. Looking at the last twelve months, to adjust for seasonality, underlying cash flow from operating activities stands at a high level of close to EUR 1.2 billion highlighting strong and sustained cash conversion.

HOCHTIEF ended the period with a solid balance sheet showing net cash of EUR 346 million, an increase year on year of EUR 381 million. This is EUR 736 million higher than at the end of March and is driven by the firm second quarter cash flow performance. In June, credit rating agency S&P reaffirmed its investment grade rating for HOCHTIEF with a stable outlook.

New orders during the first half of 2023 rose strongly to over EUR 18 billion, up 26% year on year. At the end of June 2023, the Group’s order book stands at EUR 53.6 billion, up 8% year on year on an f/x-adjusted basis. HOCHTIEF continues to steadily increase the proportion of lower-risk contracts in the order backlog which is now approaching 85% of the total. During the first half of 2023, the majority of the Group’s new orders were secured under collaborative, alliance-style, or construction management and services contracts all of which incorporate robust risk-sharing mechanisms.

Strategic update
HOCHTIEF’s pursuit of opportunities in the rapidly expanding high-tech, energy transition and digital infrastructure markets is supported by the sustained focus on delivering on environmental, social, and governance (ESG) commitments where the Group holds a leading position.

Furthermore, capital allocation decisions support the Group’s diversification and simplification goals as well as the high-tech infrastructure expertise. CEO Juan Santamaría: “We are now entering a new phase of our strategy where we can begin to harness our investment expertise in strategic high-growth sectors”. The Group has incorporated almost 5,000 new professionals over the last twelve months to support its growth strategy. “Our ability to attract talented individuals, in a period of labor shortages establishes a strong foundation for the Group to take advantage of the growth opportunities we have identified”.
 
Group Outlook
The Group guidance for 2023 is confirmed: HOCHTIEF expects to achieve an operational net profit in the range of EUR 510−550 million, subject to market conditions.

HOCHTIEF Group: Key Figures

Note: Operational profits are adjusted for non-operational effects
* Excluding the extraordinary payments by CIMIC (for the CCPP legacy settlement in Q1 2023 and Q2 2022) and at HOCHTIEF Europe (final payment of the legacy Chilean project in Q3 2022)