HOCHTIEF’s operating business performed as planned in the third quarter of 2011: The Group is in the black, with profit before taxes of EUR 333.0 million and consolidated net profit of EUR 98.7 million. That means HOCHTIEF achieved turnaround in the operating business, although it has not yet fully made good the loss incurred in the first six months. Leighton, too, once again made a strong contribution to earnings in the third quarter as planned. All four HOCHTIEF Group divisions have secured attractive, high-margin new contracts. The Group’s order backlog is equivalent to 22 months in forward orders.
But the global economic and financial market turbulence has not passed HOCHTIEF by. The macroeconomic situation has caused delays in the sale of the airport activities. HOCHTIEF is still in close negotiations and is confident of being able to seal the transaction in the near future. It is nonetheless possible that this will no longer happen in 2011 as previously announced.
Dr. Frank Stieler, Chairman of the Executive Board: "The bidders continue to show keen interest in our airports business. Sales and passenger numbers are up at our airports in the current fiscal year."
HOCHTIEF is also reviewing the assessment of potential risks for individual PPP road contracts in Greece and Chile. This relates to the HOCHTIEF Concessions and HOCHTIEF Europe divisions.
The Group therefore supplements its guidance for 2011 as follows:
In light of the increasingly uncertain macroeconomic environment, HOCHTIEF is revising its guidance for 2012 as follows:
The Group is retaining its previous guidance for 2013 unchanged:
All planning is based on the assumption that there will be neither a further marked slowdown in the global economy or disruptions in the financial markets, nor actions by specific governments that materially affect HOCHTIEF’s business.
Third quarter of 2011
Despite the macroeconomic environment, HOCHTIEF’s operating business performed well in the third quarter: The Group generated profit before taxes of EUR 333.0 million. This did not fully make good the first half loss, however. For the first nine months, there was still a pretax loss of EUR 101.6 million (Q1-3 2010: pretax profit of EUR 430.2 million). Consolidated net profit for the third quarter came to EUR 98.7 million (Q3 2010: EUR 54.6 million). The first nine months showed a consolidated net loss of EUR 57.0 million (Q1-3 2010: consolidated net profit of EUR 142.7 million).
At EUR 16.12 billion as of September 30, 2011, new orders were down by 16.6 percent on the prior-year period (Q1-3 2010: EUR 19.33 billion). There are three main reasons for the decrease: HOCHTIEF Asia Pacific came in below the equivalent prior-year figure due to the postponement of major contracts until the fourth quarter of 2011. HOCHTIEF Americas has secured more contracts, but reported new orders are down on the prior year because of the weakening US dollar. HOCHTIEF Europe mainly did less well than in the prior year because of project delays on large contracts in Germany and the Middle East.
Work done amounted to EUR 17.65 billion after the first nine months, an increase of 5.9 percent on the prior-year figure (Q1-3 2010: EUR 16.66 billion), or 3.9 percent on an exchange rate adjusted basis. The increase mainly reflects the large order backlog at HOCHTIEF Asia Pacific, which the division is working its way through on a continuous basis. Adjusted for adverse exchange rate effects, HOCHTIEF Americas similarly exceeded the prior-year period. HOCHTIEF Europe likewise delivered sustained strong performance, with an increase in work done of 16 percent in Germany.
The order backlog reached EUR 44.52 billion in the third quarter, eight percent (exchange rate adjusted: 7.0 percent) higher than in the same period of 2010 (Q1-3 2010: EUR 41.21 billion). Besides changes as a result of new orders and work done, the trend in the American and the Australian dollar brought about an exchange rate adjustment to the order backlog in the reporting period (a reduction of EUR 1.91 billion). The large order backlog is equivalent to a 22-month forward order book. Sales came to EUR 15.76 billion in the first nine months, an increase of 10.9 percent on the comparative prior-year period (Q1-3 2010: EUR 14.20 billion).
Group outlook
HOCHTIEF is back on track operationally and closed the third quarter successfully as planned. Turnaround has been achieved. In the future, the Group plans to further increase the focus on its inherent strength—the operating business. HOCHTIEF has been restructured. Its individual units are leaner and now cooperate more effectively than ever while operating at lower cost. Externally, the Group operates in growth markets such as services to help transform energy supplies, shape major cities, and develop transportation infrastructure. These offer outstanding opportunities that HOCHTIEF will make best use of.