– Order backlog at record level of EUR 8 billion
– Production output increases by 10.8%
– EBT grows to EUR 22.1 million
Outlook 2022:
– Production output of EUR 5.7 billion to EUR 5.9 billion
– Result above previous year
PORR has successfully asserted itself in the volatile first half of 2022: With a production output of EUR 2,766m, PORR achieved earnings before taxes (EBT) of EUR 22.1m. With an order backlog of more than EUR 8 billion, the stable basis of the coming years was further expanded.
“Our PORR can look back on an exciting and successful half year in 2022,” says PORR CEO Karl-Heinz Strauss. “This shows again: We get down to business and deliver results.” In particular, the increase in production output by 10.8% to EUR 2,766 million ensures a substantial increase in earnings. Earnings before taxes (EBT) increased significantly compared to the same period of the previous year to EUR 22.1 million.
With growth of 2.6% to over EUR 8 billion, the order backlog has reached a new high. This further expanded the stable basis for economic activity over the next few years. The most important projects include the interior fit-out of the VIO Plaza and the Podhagskygasse residential complex in Vienna, as well as the revitalization of the Barrandov Bridge in Prague. Other major orders include the Drammen Bybrua city bridge in Norway and the waste incineration plant in Rzeszów, Poland. “We are pursuing a strategy of selective order acceptance. This has proven itself particularly well in the first half of the year,” explains Strauss.
The early introduction of a new calculation model for the acquisition of offers has also enabled PORR to cope well with the cost increases of the past few months. Parallel to the centralization of purchasing, which ensures the availability of materials and raw materials on the construction sites, the cost increases were largely passed on to the client. Nevertheless, the cost of materials and other purchased manufacturing services increased disproportionately to sales by a total of 18.3% (sales increase of 13.4%).
Improved capital structure
PORR was able to improve its capital structure with strategic measures: The equity ratio was 18.4% as of June 30, 2022 (June 30, 2021: 18.1%). The hybrid capital was reduced by EUR 76.1 million since the same period of the previous year as a result of the repayment of the hybrid bonds in 2014 and 2017; its share in equity was significantly reduced to 33%.
PORR has also increased its balance sheet structure in terms of net debt. This improved by EUR111.7 million compared to June 30 of the previous year. The liquidity reserve is more than EUR750 million.
“We are therefore well equipped for the second half of the year,” says Strauss.
Intelligent growth with Green and Lean
“Our goal is sustainable profitability,” confirms Strauss. “We are consistently continuing our PORR 2025 program for the future and are focusing on selective, intelligent growth.” This includes risk management in order acceptance as well as the continuous optimization of construction processes and progressive digitization through BIM and LEAN.
Particular value is placed on projects such as the sustainable revitalization of the Schader commercial building in Zurich: the demolition to the primary construction was carried out as resource-efficiently as possible. In line with the circular economy, the aim is also to reuse materials. In this way, PORR shows how sustainable construction can positively shape the environment. “Our Green and Lean strategy sets the direction,” explains Strauss.
Outlook for 2022
“We are now slowly recognizing that material prices are stabilizing at a high level and we are cautiously optimistic about this situation,” emphasizes Strauss. Based on the current earnings development of PORR, the Executive Board expects production output of EUR 5.7bn to EUR 5.9bn for the 2022 financial year. Despite ongoing uncertainties regarding price and cost developments and also with regard to the supply chain, the Executive Board calculates compared to the previous year an improved result. In the medium term up to 2025, a target EBT margin of 3.0% is still being aimed for.
However, the further development of the Ukraine conflict and its consequences and aggravation are currently not foreseeable. This is accompanied by increased uncertainty in connection with gas deliveries from Russia and the energy supply dependent on them. In addition, possible further significant increases in energy and building material prices cannot be ruled out. This means that any assessment of economic development is subject to forecasting risks.
