Hochtief beats forecasts as new orders rise

Author: 
REUTERS
Publication Date: 
Wed, 2011-08-17 18:16

The company also confirmed its full-year outlook for 2011-2013, and said it expected its troubled Australian unit Leighton to return to strong performance soon.
The group added that it was pleased with the progress of the sale of its airports business, and expected the deal to be completed by year-end.
“We are very satisfied with the course of the process so far,” Chief Executive Frank Stieler said in a statement, declining to comment further on the bids. 
The group withdrew a comment by Stieler in the press statement, in which he said the bids were “significantly higher than the figures launched on tactical grounds in the media.” 
HNA Group, parent of Chinese airline Hainan Airlines Co, has said it is bidding, while sources have said Vinci and Fraport have also put in offers, with the bids seen at over 1 billion euros.
Hochtief posted second-quarter earnings before tax of 10.2 million euros ($14.4 million) on Wednesday.
It had been expected to report a pretax loss of 7.46 million euros, according to the average estimate of eight banks and brokerages.
“Our Australian subsidiary is on a very stable trend. Leighton will quickly return to the accustomed good performance,” Stieler said.
He said, however, that he was “not satisfied” with the quarterly consolidated net loss, which widened to 155.6 million euros from a net profit of 88.1 million euros a year earlier, mainly due to the group’s Asia-Pacific operations.
Although orders declined in the second quarter compared with the year-earlier period, they rose in the first half from 12.92 billion euros in the first six months of 2010, to 13.045 billion euros in the first six months of 2011. 
Hochtief’s Americas business fell short of the prior-year period in terms of orders, due to exchange rate effects, the group said. 
The global construction sector has had a sluggish recovery from the financial crisis, and civil spending cuts and austerity measures, especially across parts of Europe and the US, have held the industry back.
In June Spanish builder ACS took its stake in Hochtief to more than 50 percent, after a bitter takeover battle that began in September 2010.
Data from StarMine shows Hochtief trades at 11.3 times 12-month forward earnings, above German rival Bilfinger Berger, which trades at a multiple of 11.1 but at a discount to Austrian peer Strabag, which trades at 11.9 times.

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