Improved operating result (EBIT), healthy order books and a positive outlook
D i e t l i k o n, 16 September 2008 – Construction services group Implenia can look back on a very satisfactory first half of 2008. Operating earnings (EBIT) under IFRS were much higher than a year ago at CHF 23.4 million, and the group result reached CHF 16.8 million (previous year CHF 3.5 million). This good performance was achieved on turnover (IFRS) of CHF 1080 million, which is slightly higher than the year-back figure. From this solid platform, and owing to the current very healthy state of orders at all four divisions, we expect turnover for financial 2008 as a whole to be on a par with last year, with a good overall group result.The 2008 financial year is the first that has not been hampered by exceptional costs relating to the merger. «Following the successful merger of the two founding companies, we are concentrating all our energy on implementing our strategic objectives,» said CEO Christian Bubb. «The results achieved so far – including the latest interim figures, which have met our expectations – show that we are on the right track.»
At the end of July 2008, orders across the group totalled a very healthy CHF 2740 million. If two recently acquired contracts – Nant de Drance in Valais (Implenia's share: CHF 300 million) and AXA Tower in Zurich-Oerlikon (CHF 200 million) – are included, orders currently total CHF 3240 million (25% higher than the year-back figure of CHF 2577 million). These orders are spread over several years.
Equity capital stood at CHF 413.1 million as at 30 June (31 December 2007: CHF 404.9 million). Net debt was reduced over the year from CHF 184.6 million (30 June 2007) to CHF 110.2 million (30 June 2008). Free cash flow in the first half-year was positive at CHF 10.6 million (previous year CHF -188.7 million).
Real Estate Division
The Real Estate Division (project development, engineering, general contracting) expects to post gross turnover of about CHF 1226 million for the current 2008 financial year (previous year CHF 1265 million) and EBIT of around CHF 30 million.
The general contracting business was able to reinforce its leading market position.
Despite an acquisition policy focused on maintaining margins, incoming orders came to a very healthy CHF 1464 million as at end-July 2008. The company is forging ahead with the more volatile project development business, which has broad regional support. The engineering business is in a phase of consolidation and will continue to strengthen its activities with a focus on sustainable construction.
In May, the property management company Privera AG was sold to Bugena SA of Western Switzerland with retrospective effect from the start of the year. As far as post-construction activities are concerned, Implenia will concentrate in future mainly on Reuss Group's technical facility management business.
Infrastructure and Tunnel/General Contracting Division (construction)
Overall annual gross turnover from construction work should come to around CHF 1469 million for 2008 as a whole, and operating earnings (EBIT) to about CHF 44 million. At the end of July 2008, orders stood at CHF 1775 million (previous year CHF 1499 million). These orders, especially in underground construction, are spread across several years.
During the period under review the two divisions made further productivity gains on building sites, as well as optimizing lines of supply and minimizing risks by taking great care over acquisitions and preparations for work.
Global Solutions
This division, which is responsible for foreign activities, made good progress in its target markets. Initial projects in Russia have entered the realization phase. The «Russian Land Implenia» joint venture was established so the company could start managing construction projects in Russian Land's portfolio. In the Middle East, Implenia has begun systematically opening up markets in the United Arab Emirates (UAE), Qatar and Oman. A representative office is about to open in Dubai. This means that the extensive work already done on evaluating partners and projects can be continued from a local base.
In the meantime, the division is well placed to make the most of its core competencies, i.e. general planning and project management in the expert & premium buildings and infrastructure sectors.
Laxey dispute continues
The comprehensive investigation published by the Federal Banking Commission in March confirmed that Laxey acquired its stake in Implenia illegally. In addition, Laxey's takeover bid during the period under review met with failure. Several court cases are currently outstanding, which Implenia believes will vindicate its stance in all respects. None of these disputes has any affect on the company in either operational or strategic terms.
Positive outlook
Thanks to very healthy order books at all divisions, the group expects overall turnover for financial 2008 to be on a par with last year, with a good group result.
Contact:
Christian Bubb, CEO Implenia
Tel. 0041 (0)44 805 45 55, Mobile 0041 (0)79 219 86 80
Email christian.bubb@implenia.com
Roger Merlo, CFO Implenia
Tel. 0041 (0)44 805 45 58, Mobile 0041 (0)79 353 78 10
Email roger.merlo@implenia.com