PORR has continued its robust performance in the first half of 2024, marked by a significant increase in earnings. The company reported a 23.7% rise in operating earnings (EBIT) to EUR 42.2 million, fueled by increased production output and a healthy order backlog. Despite challenges in the European construction industry, PORR remains optimistic about its prospects for the remainder of the year, reaffirming its positive outlook for 2024.
“We made significant progress in the first half of the year, delivering impressive results,” said PORR CEO Karl-Heinz Strauss. “With strategic acquisitions like the gravel and landfill resources of the PANNONIA Group and the road construction specialist Waggershauser Group, we’ve further expanded our vertical integration and surface business. We’re on track with our future program, PORR 2025, and have increased our construction output.”
Production output for the company rose by 3.3% year-on-year, reaching an all-time high of EUR 3.1 billion. The infrastructure sector, particularly tunneling and large-scale projects in Romania, drove this growth. Austria remains PORR’s largest market, accounting for 44.8% of its business, followed by Germany and Poland.
At the end of June 2024, PORR’s order backlog stood at EUR 8.56 billion, the third-highest in the company’s history. This includes major infrastructure projects like the railway technology equipment for the Semmering Base Tunnel and new environmental engineering contracts such as the thermal waste utilization plant in Gorlice, Poland. The order intake for the first half of 2024 was EUR 3.2 billion, slightly below the previous year’s record, which had been bolstered by the Brenner Base Tunnel project.
Financially, PORR’s revenue saw a modest increase of 0.6% to EUR 2.91 billion. The company significantly boosted its EBIT by 23.7% to EUR 42.2 million, and earnings per share rose by 45.2% to EUR 0.45. Despite inflation-driven staff cost increases, PORR managed to reduce material and service costs by EUR 41.5 million, contributing to its improved profitability.
PORR’s balance sheet remains stable, with total assets of EUR 4.17 billion as of June 30, 2024. The company’s equity increased to EUR 810.6 million, and the equity ratio improved to 19.4%, up from 18.5% a year earlier. Net debt stood at EUR 327.2 million, influenced by several one-off factors, including acquisitions and the early repayment of profit participation capital. Excluding these non-recurring effects, net debt decreased by 7.1% to EUR 208.5 million.
Cash flow from earnings dropped to EUR 114.1 million due to high tax payments, but improved working capital management led to an increase in cash flow from operating activities by EUR 17.9 million. The company’s acquisition activities resulted in a EUR 61.9 million increase in cash outflow from investing activities. PORR continues to maintain strong liquidity reserves, totaling EUR 691.3 million.
Looking ahead, PORR remains positive about the remainder of 2024. “We anticipate a recovery phase this year,” said Strauss. “While residential construction remains weak, we expect a significant turnaround in the European construction industry by 2025, driven by national funding programs and subsidies. Our expertise in civil engineering, particularly in digital and energy infrastructure, positions us well to benefit from these developments.”
Based on its strong order backlog, PORR’s Executive Board expects a moderate increase in output for 2024, along with a rise in operating results. The company also projects an increase in its EBIT margin to 3.0% in the medium term. However, PORR acknowledges that any worsening of the geopolitical situation could negatively impact its business activities, introducing an element of forecasting risk into its economic outlook.
