Dekpol reported PLN 25.55 million in consolidated net profit attributable to shareholders of the parent company in H1 2023, compared to PLN 26.4 million in profit a year earlier, the company said.
Operating profit was PLN 38.66 million vs. PLN 43.37 million profit a year earlier.
Consolidated sales revenues reached PLN 569.57 million in 1H 2023 vs. PLN 635.02 million a year earlier.
EBITDA reached PLN 47.2 million, down 6% year-on-year.
“We assess the Group’s H1 results as solid and in line with our expectations. The market situation remains challenging – this is particularly reflected in Dekpol Steel, where we have higher operating costs than a year ago – but we see that gradually from quarter to quarter orders are returning and the company has a plan for itself and is consistently executing it. At the turn of the year, with a very shaky situation in the materials market, we were very cautious and selective about new projects for Dekpol Construction. This is now reflected in lower year-on-year revenues, but also in maintaining a satisfactory level of margins. At the same time, we take care of our strong market position, but most of all we care that the contracts we execute translate into the expected level of results, not just turnover,” said Dekpol CEO Mariusz Tuchlin.
“After H1 2023, the level of pipeline in this largest segment is at a record high, and the Dekpol Construction team has ambitious plans for the whole of 2023, although one should, of course, take into account that the macroeconomic situation affects the mood of companies and their propensity to carry out new investments. Dekpol Developer is also consistently achieving its goals for 2023 – the company’s offer is broad and adapted to changing macroeconomic conditions. Thanks to this, it responds to the demand of customers in all market segments: both those who want to invest their financial surpluses in real estate and those who, thanks to assistance programs such as ‘2% Safe Credit’, can buy their first apartment. To sum up: the market situation is demanding, but thanks to many years of experience, strong foundations, business diversification and the high and constantly improved competence of the team, the Dekpol Group is able to operate effectively and achieve its goals,” he added.
The company said that as of the end of June 2023, the Group’s cash balance was PLN 227.2 million, and the LTM net debt/EBITDA ratio was at a safe level of 0.91.
The company pointed out that the general contracting segment (GW, DEKPOL Construction) is Dekpol Group’s largest business segment, with its revenue share reaching 65% in H1 2023. Revenues of the GW segment in the period under review amounted to PLN 370 million, down 19% year-on-year, and operating profit amounted to PLN 25.4 million against PLN 30 million a year ago (-15%). The drop in revenues is related to with the timing of work on individual projects.
As of the end of June 2023, the company had in its portfolio contracts for third parties with a total contractual value of over PLN 1,507 million net. Projects with a total net value of about PLN 885 million remained to be executed after the reporting period – nearly double the amount at the end of 2022. In addition, within the GW segment, there are intragroup development projects with a total value of PLN 413 million, and projects worth about PLN 113 million remained to be executed after the reporting period. Most of Dekpol Construction’s contracts are carried out on behalf of private investors and have an average value of nearly PLN 70 million. Industrial and logistics projects have a dominant share in the order portfolio – at the end of June 2023, their share in the total order portfolio was about 78%.
In H1 2023, the revenue of the development segment amounted to PLN 102.7 million (18% share in the Group’s revenue), and the operating result amounted to PLN 20.9 million (compared to PLN 59.6 million and PLN 8.8 million in H1 2022, respectively). In the financial result of H1 2023, the Dekpol Group recognized 181 units in revenue from the development segment, as well as partial revenue (realized in accordance with the progress of work on the construction site) from the implementation of a project with an institutional entity in Wroc┼Вaw on Braniborska Street. A year ago, 103 units were recognized in the revenue of the development segment. Contracting in H1 2023 (in terms of preliminary, development and reservation agreements) amounted to 198 units compared to 197 units in H1 2023. As of the end of June 2023, 609 units were available in Dekpol Developer’s sales offer. The company has a positive assessment of the market situation and prospects, and maintains its target of PLN 308 million in revenue in 2023.
The construction equipment manufacturing segment (Dekpol Steel) accounted for more than 14% of the Group’s revenue in H1 2023. Dekpol Steel’s revenue in the period in question reached PLN 76.7 million (-22%), and operating profit amounted to PLN 3.5 million (vs. PLN 10.9 million a year ago). For Dekpol Steel and Intek, the first half of 2023 was a period of further strengthening their positions in new production areas and a period of activities related to improving the efficiency of their existing production profile. Both companies are focused on attracting new customers who recognize the high quality and timeliness of production, as well as initiatives in the area of innovation of the solutions offered (an example is the obtaining by Dekpol Steel, as 1 of 2 entities in the world, of a license for the production of innovative buckets, reducing the cost of mining by 25% – this solution is a patent of SSAB from Sweden).
On a standalone basis, net profit in H1 2023 amounted to PLN 12.62 million, compared to PLN 0.11 million profit a year earlier.
Dekpol is based on three main segments: general contracting services, production of buckets and attachments for construction machinery and real estate development activities. The company’s shares have been listed on the WSE since 2015. It had consolidated revenues of PLN 1,386.85 million in 2022.
Source: Dekpol Group and ISBnews
