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Porr AG
Interim / Quarterly Report • Aug 29, 2019
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Interim / Quarterly Report
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Cover Bericht zum 1. Quartal 2019 construction . mas ter . pieces . building . master .pieces . buildi ng . master . pieces . building . master . pieces . building . master . pieces . building .
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Half-Year Report 2019 Half Yearly Report 2019
PORR Half-Year Report 2019|This is PORR
Key Data
| in EUR m | 1–6/2019 | 1–6/2018 | Change |
|---|---|---|---|
| Operating data | |||
| Production output | 2,497 | 2,458 | 1.6% |
| Foreign share | 57.7% | 59.9% | -2.2PP |
| Order backlog | 7,600 | 6,530 | 16.4% |
| Order intake | 2,997 | 2,621 | 14.4% |
| Staffing level (average) | 19,339 | 18,428 | 4.9% |
| 1–6/2019 | 1–6/2018 | Change | |
| Earnings indicators | |||
| Revenue | 2,181.6 | 2,223.2 | -1.9% |
| EBITDA | 95.4 | 72.4 | 31.8% |
| EBIT | 17.4 | 14.7 | 18.5% |
| EBT | 8.2 | 6.6 | 24.4% |
| Profit/loss for the period | 6.0 | 5.6 | 7.2% |
| 30.6.2019 | 31.12.2018 | Change | |
| Financial position indicators | |||
| Total assets | 3,567 | 3,115 | 14.5% |
| Equity (incl. non-controlling interests) | 576 | 618 | -6.8% |
| Equity ratio | 16.2% | 19.9% | -3.7PP |
| Net debt2 | 830 | 349 | >100.0% |
| 1–6/2019 | 1–6/2018 | Change | |
| Cash flow and investments | |||
| Cash flow from operating activities | -318.1 | -181.0 | 75.7% |
| Cash flow from investing activities | -81.2 | -17.5 | >100.0% |
| Cash flow from financing activities | 215.4 | -34.5 | >100.0% |
| CAPEX3 | 132.2 | 75.2 | 75.8% |
| Depreciation/amortisation/impairment | -78.1 | -57.8 | 35.1% |
| 1–6/2019 | 1–6/2018 | Change | |
| Key data regarding shares |
Number of shares (weighted average) 29,095,000 29,095,000 - Market capitalisation as of 30 June (in EUR m) 564.4 837.9 -32.6%
1 The production output corresponds to the output of all companies and consortiums (fully consolidated, equity method, proportional or those of minor
significance) in line with the interest held by PORR AG.
2 The figures as of 31 December 2018 have been adjusted due to the first-time application of IFRS 16. Details can be found on page 35 of the notes to the interim consolidated financial statements. 3
Investments in property, plant and equipment and intangible assets.
The figures have been rounded off using the compensated summation method. Relative changes are derived from the non-rounded values.
H1 at a glance
Consolidation continues Implementing measures
Construction demand remains high Pressure on margins still strong
Record order backlog of EUR 7.6 bn Disciplined bidding
Production output up by 1.6% Unchanged strategic focus
EBT of EUR 8.2m surpasses previous year Stable EPS of EUR 0.13
Guidance for 2019 production output confirmed Moderate output increase in 2019
Contents
- 2 Highlights
- 4 Strategy Update
- 6 Foreword by the Executive Board
- 7 PORR on the Stock Exchange
- 8 Project Highlights
- 16 Management Report
- 17 Markets and Performance
- 21 Segment Report
- 23 Interim Consolidated Financial Statements as of 30 June 2019
- 24 Consolidated Income Statement
- 25 Statement of Comprehensive Income
- 26 Consolidated Cash Flow Statement
- 27 Consolidated Statement of Financial Position
- 28 Statement of Changes in Group Equity
- 30 Notes to the Consolidated Financial Statements
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- 41 Statement of all Legal Representatives
- 42 Financial Calendar 2019
- 42 Contact
- 43 Acknowledgements
Highlights
150 years of PORR
"Allgemeine Österreichische Baugesellschaft" – today's PORR AG – has been listed on the Vienna Stock Exchange since 8 April 1869. It has been realising complex projects in building construction and civil engineering for 150 years. Today PORR and its workforce of around 20,000 is a European construction company with a leading position in every area of the construction industry's value chain. What's more, as a technology leader it is committed to networked design-build solutions and proactively promoting the digital issues of the future.
Sustainability in practice
Springtime sees busy bee colonies moving back in to more than 400 hives at 40 international PORR locations. 20% (around two tonnes) of the honey they make goes to clients, business partners and employees, with the beekeepers left to enjoy the remainder. In order to secure a bright future for the bees, as of this year the PORR hives are now being used as a training resource for budding beekeepers. Novice apiarists and keen PORRians attend special courses offering practical training on how to handle the bees.
Aiming high in Poland
Two tower-construction projects represent the largest new orders in Poland in the first half of the year: PORR acquires the contract to build the SKYSAWA office complex as well as the 3T office park in Tricity. Taken together, the value of the two projects exceeds EUR 100m, while the gross floor area totals around 75,000m².
Living in the heart of Europe
Demand for housing remains consistently high in European cities. This is why PORR has acquired numerous residential construction projects in Austria, Germany and Switzerland. The largest project, the Wiener Wohngarten, will offer more than 680 residential units. Other attractive projects were acquired in cities such as Munich and Zurich.
First blast on the BBT
PORR Half-Year Report 2019|This is PORR
A ceremony to mark the start of construction works on the south-heading exploratory tunnel was held at the end of March at the construction site of the Brenner-Base Tunnel (BBT), lot H51. The drill-and-blast method is being used with shotcrete lining on a length of 5.6km. The breakthrough towards Italy should take about four years.
PORR forges connections
PORR acquires two infrastructure projects in Romania. It was awarded the contract to extend the railway line between Mogoșoaia and Balotești as well as for the new construction of the motorway between Sibiu and Pitești, thereby making a major contribution to modern infrastructure in the country. The road construction project is a design-build contract with a length of 13.2km and volume of around EUR 122m.
Civil engineering up north
PORR brings home two new large-scale projects in Norway: Winning the tender to build the 836m-long Minnevika Bridge at Eidsvoll is an impressive testament to its expertise in bridge building. The contract has a volume of EUR 93.9m. In addition, PORR is charged with the new construction of the E1 between Eggemoen and Åsbyda. This design-build contract includes a bridge with a length of 634m; the order is worth EUR 47.6m. On the construction of the Liafjellet Tunnel, currently underway, PORR has emerged as a role model in health and safety: Following 1,000 days working on the project, the PORRians on site celebrated the 1,000th incident-free day on 27 June 2019.
Sought-after tunnelling technology
At the start of the year, PORR Infra GmbH together with a consortium won the tender for the electrical installations of the Hirschhagen Tunnel. The second-longest road tunnel in Germany is situated on the A44 near Kassel. PORR Infra GmbH is responsible for supplying, installing and commissioning all of the electrical equipment, fittings and components. The contract underlines PORR's expertise in tunnelling – from the initial design through to opening to traffic.
Strategy Update
Markets
| Market | Potential | PORR-specific |
|---|---|---|
| Austria | strong | High capacity utilisation, powerful market position |
| Germany | strong | Capacity bottlenecks, turnaround confirmed |
| Switzerland | strong | Stable demand |
| Poland | strong | High demand, capacity bottlenecks pressure on margins |
| Czech Rep./Slovakia | neutral | Expand permanent business, higher construction prices |
| Romania | strong | High demand, evolve stronger project market into home market |
| Qatar/UAE | neutral | Reduce project volumes and risk |
| UK | weak | Brexit uncertainty, withdraw from market |
| Norway | neutral | Potential infrastructure, demanding market |
PORR 2025
Organisation
Greater efficiency
Operational Analysis
able corporate success.
agement are also being addressed.
As part of the PORR 2025 transformation programme, PORR intends to increase cost discipline at every level. This should be achieved by optimising key processes such as procurement, investments and asset management. Furthermore, non-core activities will be scrutinised in order to streamline the focus on construction competencies. Assisted by a selective approach to tender acquisition, the PORR portfolio structure should represent a risk-aware selection coupled with a well-balanced mix of infrastructure projects and permanent business. Improvements in risk management and contract man-
Enhancing values
single aim: PORR wants to create sustainable value long-term.
Having already implemented a structural realignment, PORR has streamlined the number of its business units to just three – effective as of 1 January 2019. This has allowed it to bundle competencies and enhance its focus on the core business and on monitoring risks and costs. The introduction of a new management model has led to the optimisation of the central functions (Shared Service Center), the reduction of hierarchies and the prevention of redundancy. With the newly established corporate culture – based on the five Principles – PORR wants to position itself as an attractive employer and be ideally prepared for the digital future. These measures should result in greater efficiency and thereby lead to sustain-
The PORR strategy remains unchanged and geared towards the long term. The record order backlog provides a basis for the consistent focus on consolidating the company's growth to date and on operational excellence. PORR has introduced a transformation programme named PORR 2025 and subjected its activities to a strategic review. The initiatives implemented are divided into the following four action fields: streamlining the organisation, analysing the market, analysing the operating business, and digital topics of the future. All of these measures are in pursuit of a
Digital Opportunities
more focused market profile.
Market Analysis
Greater focus
Realising future potential
strengthen its competitiveness.
The need for transformation in the construction sector has undergone a massive rise in terms of technology. The result is new, data-based business models. Digital networking across the entire construction value chain, coupled with the development of new and advanced software solutions, is set to change the competitive landscape in the medium term. PORR is investing heavily in new technologies such as BIM and Advanced Analytics and promotes methods such as LEAN Design and LEAN Construction. Significant investments and measures to harmonise IT processes throughout the Group have been initiated. Developing key topics in the digitalisation sphere holds enormous potential for PORR and should
In order to be ideally prepared to handle new challenges, PORR has conducted a comprehensive analysis of the markets on which it operates. The strategic focus on the existing home markets and core competencies remains valid. Added to this is the new home market of Romania. Slovakia will fall under the operating purview of the managers responsible for the Czech Republic. Poland is doing well and building on new orders with a better risk profile; that said, the pressure on margins remains high. No further projects will be undertaken in Great Britain, while project volumes are being significantly reduced in Qatar. Norway is currently in an analysis phase. This approach should sustainably enhance PORR's regional strengths in the individual markets and lead to an even
The table shows the current demand on the PORR markets.
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PORR Half-Year Report 2019|This is PORR
The PORR strategy remains unchanged and geared towards the long term. The record order backlog provides a basis for the consistent focus on consolidating the company's growth to date and on operational excellence. PORR has introduced a transformation programme named PORR 2025 and subjected its activities to a strategic review. The initiatives implemented are divided into the following four action fields: streamlining the organisation, analysing the market, analysing the operating business, and digital topics of the future. All of these measures are in pursuit of a single aim: PORR wants to create sustainable value long-term.
Organisation
Greater efficiency
Having already implemented a structural realignment, PORR has streamlined the number of its business units to just three – effective as of 1 January 2019. This has allowed it to bundle competencies and enhance its focus on the core business and on monitoring risks and costs. The introduction of a new management model has led to the optimisation of the central functions (Shared Service Center), the reduction of hierarchies and the prevention of redundancy. With the newly established corporate culture – based on the five Principles – PORR wants to position itself as an attractive employer and be ideally prepared for the digital future. These measures should result in greater efficiency and thereby lead to sustainable corporate success.
Market Analysis
Greater focus
14PORR 2025 In order to be ideally prepared to handle new challenges, PORR has conducted a comprehensive analysis of the markets on which it operates. The strategic focus on the existing home markets and core competencies remains valid. Added to this is the new home market of Romania. Slovakia will fall under the operating purview of the managers responsible for the Czech Republic. Poland is doing well and building on new orders with a better risk profile; that said, the pressure on margins remains high. No further projects will be undertaken in Great Britain, while project volumes are being significantly reduced in Qatar. Norway is currently in an analysis phase. This approach should sustainably enhance PORR's regional strengths in the individual markets and lead to an even more focused market profile.
Operational Analysis
Enhancing values
As part of the PORR 2025 transformation programme, PORR intends to increase cost discipline at every level. This should be achieved by optimising key processes such as procurement, investments and asset management. Furthermore, non-core activities will be scrutinised in order to streamline the focus on construction competencies. Assisted by a selective approach to tender acquisition, the PORR portfolio structure should represent a risk-aware selection coupled with a well-balanced mix of infrastructure projects and permanent business. Improvements in risk management and contract management are also being addressed.
Digital Opportunities
Realising future potential
The need for transformation in the construction sector has undergone a massive rise in terms of technology. The result is new, data-based business models. Digital networking across the entire construction value chain, coupled with the development of new and advanced software solutions, is set to change the competitive landscape in the medium term. PORR is investing heavily in new technologies such as BIM and Advanced Analytics and promotes methods such as LEAN Design and LEAN Construction. Significant investments and measures to harmonise IT processes throughout the Group have been initiated. Developing key topics in the digitalisation sphere holds enormous potential for PORR and should strengthen its competitiveness.
Dear shareholders,
Our focus in 2019 is on consolidation. We face a historically unique situation in the construction sector. On the one hand there is no end in sight to the strong demand; on the other, the cost of construction materials and logistics remains high, as does the lack of skilled labour. Under our PORR 2025 transformation programme we are working intensively on a range of strategic initiatives to allow us to exploit opportunities in the current market environment with great precision. The record order books with EUR 7,600m have secured us full capacity utilisation and allow us to be selective in our approach to new orders. At the same time, we are consistently evaluating our markets and activities and making adjustments in line with changing conditions wherever needed. We are also committed to combining tried-and-tested concepts and new, competitive initiatives and have increased our investment in future topics so we can better grasp the opportunities to come. This will sustainably strengthen PORR long-term.
Vienna, August 2019
Sincerely, The Executive Board
Karl-Heinz Strauss Chairman of the Executive Board and CEO
J. Johannes Wenkenbach Executive Board member and COO
Andreas Sauer Executive Board member and CFO
Thomas Stiegler Executive Board member and COO
PORR on the Stock Exchange
Positive mood on the stock exchanges
The international stock markets had a good start to 2019. That said, the deepening trade conflict between the USA and China interrupted the positive trend in May. The first signs of rapprochement in the trade disputes and signals sent by the central banks suggesting a more expansive money policy led to a recovery on the international stock exchanges at the end of the first half of 2019.
The leading US index Dow Jones Industrial (DJI) achieved growth of 14.0% in the first half of the year. The expectation of an imminent interest rate cut by the Federal Reserve contributed to this positive performance.
In Europe the leading eurozone index EURO STOXX 50 rose by 18.3% in the period under review. A significant factor was the performance of the German stock market, which benefited from better than expected corporate profits in the first quarter. The leading DAX index closed up 17.4% at the end of the first half, broadly recovering from its two-year-low at the start of the year.
The performance on the Vienna Stock Exchange mirrored those of the global markets. Following price decreases in the second quarter, the leading ATX index closed up 10.5% against year-end.
Good start for the PORR share
The PORR share performed well in the period under review. After starting the year at a low of EUR 17.96, it gathered momentum. This upward trend became even more pronounced with the publication of the preliminary figures for 2018 in March. The period-high of EUR 23.70 was reached on 30 April. This was followed by a decline – parallel to the performance of the international markets – that was interrupted in June when the share levelled off. At a price of EUR 19.40 as of 28 June, the share climbed by 11.2% overall against year-end 2018, thereby slightly outperforming the ATX. Market capitalisation stood at EUR 564.4m.
International shareholder structure
The syndicate (Strauss Group, IGO-Ortner Group) held the majority of shares outstanding, totalling 53.7%. According to the most recent analysis in June, the free float of 46.3% is primarily split among Austria (25.5%) and Great Britain (13.4%). In addition, US investors held 11.1%, while 13.9% of free-float shares were held by investors from Germany and France.
Share price and trading volumes of the PORR share in the first half of 2019 (index)
PORR share ATX – Austrian Traded Index Trading volume PORR share
Project Highlights
8
Danzermühl power plant
?Imageseiten be.public Turbine, power plant construction Laakirchen | Austria Annual power generation: 44.8 GWh Construction period: 2017–2019
Danzermühl power plant Turbine, power plant construction
Annual power generation: 44.8 GWh Construction period: 2017–2019
Laakirchen | Austria
Project Highlights
Fresenius Kabi
5 10
Industrial construction, high-bay warehouse Werndorf | Austria Height: 36m Construction period: 2018–2019
Widok Towers
Office building Warsaw | Poland Gross floor area: 32,200m² Construction period: 2017–2020
116
Filstal Bridge
127
Bridge construction Mühlhaus im Täle | Germany Length: 485m Construction period: 2013–2021
8Mönchhof wind park Power plant construction Mönchhof | Austria Total output: 30,000 kW Construction period: 2018–2020
Himberg Recycling Center Recycling construction waste
Himberg | Austria Output: 700,000t per year
Filstal Bridge Bridge construction Mühlhaus im Täle | Germany
Length: 485m
Construction period: 2013–2021
914
D11
Road construction Smiřice–Jaroměř | Czech Republic Length: 7.4km Construction period: 2018–2022
Humber Crossing
Pipeline construction Goxhill | Great Britain Tunnel length: 4,862m Construction period: 2016–2020
Austrian Parliament
General refurbishment and extension of the heritage-protected building Vienna | Austria Construction period: 2018–2021
1510
Management Report
Production output1 by segment (in EUR m)
Order backlog by segment (in EUR m)
EBT (in EUR m)
16
1
Average staffing levels
The production output corresponds to the output of all companies and consortiums (fully consolidated, equity method, proportional or those of minor significance) in line with the interest held by PORR AG.
Markets and Performance
Economic Environment
In line with expectations, the performance of the global economy was reticent in the first half of 2019. Both the International Monetary Fund (IMF) and the OECD made another slight downwards revision to their forecasts for 2019 to 3.2%. A gradual recovery of growth rates is expected in subsequent years.
Ongoing geopolitical tensions dampened expectations worldwide, a development that has continued beyond the first half of 2019. While the US economy continued to benefit from earlier economic policy measures, the US market nonetheless came under increasing pressure from lower exports. The Federal Reserve subsequently cut the benchmark rate to between 2.00% and 2.25% to counter the risk of an economic downturn. The IMF adjusted its forecasts for the USA to 2.6%.
Weak export demand and the ongoing international trade conflicts led to a slowdown in European economic growth. Subdued domestic demand and the Brexit debate additionally contributed to lowering expectations. Nonetheless, the OECD expects growth of 1.2% for the eurozone in 2019 as the European Central Bank (ECB) is maintaining its low interest-rate policy. A rate hike has been announced for 2020 at the earliest.
Germany had a comparatively strong start to 2019 – supported by steady consumer spending. That said, the business climate worsened significantly over the course of the year according to the ifo institute. Lower exports and a reduction in industrial production had a negative impact on the forecasts. The OECD experts have currently forecast global growth of 0.7% for 2019. A noticeable recovery is anticipated in 2020.
The Austrian economy was not fully able to sidestep the international economic weakness. The ongoing rise in consumer spending and the high gross fixed capital formation, which had a stabilising effect on GDP growth, acted as a counterbalance here. Austria's national bank, the OeNB, has forecast economic growth of 1.5% for 2019 based on the prevailing high employment levels and the correspondingly high domestic demand.
Developments in the construction industry
With growth of around 2% forecast in the Euroconstruct countries in 2019, the European construction sector is continuing its more-than-five-year growth streak. Experts expect a cumulative plus of 5.0% by 2021. Positive impacts continue to come from the low interest rate environment and the high demand for traffic and energy infrastructure.
While investments in renovations are growing in the building construction sector and moderate growth has been observed in non-residential building construction, new-build housing has lost momentum. Civil engineering has seen tangible dynamic growth. Significant factors here include the increased need for investment coupled with greater financing leeway from the public purse.
The expectations of Austrian construction companies are cautiously positive. According to WIFO, in the first half of 2019 growth in value added by the construction industry was around 2.8% higher than the previous year. Euroconstruct cited civil engineering as a driver, especially as regards road and rail construction. The German construction industry also reported ongoing strong demand in housing construction. The order intake of the entire construction industry remained consistently high, with the performance in revenue especially positive. In Poland and the Czech Republic, Euroconstruct experts have forecast an increase in production volumes of 8.9% and 4.1% respectively for 2019. Comprehensive financing from the EU Cohesion Fund is supporting the strong growth momentum on these markets.
Development of Output
The indicator production output covers all classic design and construction services, waste management, raw materials sales and facility management, i.e. all significant services rendered by PORR. For companies fully included in the consolidated group, this output broadly corresponds to the revenue defined and reported in accordance with IFRS. In contrast to revenue, production output also includes the output from consortiums and companies accounted for under the equity method, as well as those of minor significance, in line with the interest held by the Group and differences in definitions reconciled pursuant to commercial criteria.
In the first half of 2019, PORR generated production output of EUR 2,497m, thereby building on the good start to the year. The moderate growth of 1.6% reflects PORR's strategic focus on consolidation in 2019. Structural engineering in Germany, along with Slovakia and the Czech Republic, made an especially strong contribution to the increase of EUR 39m. A significant factor in the output growth in the Czech Republic was the acquisition of Alpine Bau CZ a.s., which closed in the previous year.
Hereafter, segment reporting is presented in accordance with the new organisational structure in place since 1 January 2019. Comparative data from previous periods has been adjusted retrospectively.
In the first half of 2019, Business Unit 1 – Austria, Switzerland generated production output of EUR 1,227m. In addition to Switzerland, the rise of EUR 28m or 2.3% primarily came from the output increases in the Austrian federal provinces of Styria, Carinthia and Upper Austria.
With production output of EUR 445m, Business Unit 2 – Germany reported growth of EUR 9m or 2.1%. Structural engineering in Germany and building construction in the South region played a key part in this performance.
The production output of Business Unit 3 – International broadly held steady at EUR 770m. The completion of several large-scale projects led to a slight decrease in the first half of 2019 of EUR 1m or 0.2%. In addition to Slovakia and the Czech Republic, good progress was made on several large-scale projects in Poland such as the railway lines LK354 Poznan—Pila and E30 Kedzierzyn—Opole.
In the first half of 2019, around 90% of total production output was generated on PORR's five home markets – Austria, Germany, Switzerland, Poland and the Czech Republic. Austria remained the most important PORR market with a share of 42%, followed by Germany at 28%. Poland generated 12% of total output, while the Czech Republic and Switzerland each accounted for around 4%.
Order Balance
With a record level of EUR 7,600m, PORR managed to expand its order backlog once again. This represents an increase of 16.4% or EUR 1,070m against the second quarter of the previous year. The performance of the
order intake was also positive. With growth of 14.4% or EUR 376m against the first half of the previous year, it stood at EUR 2,997m. PORR's focus remains on a selective approach to acquiring orders and on intelligent growth.
The largest new order in the first half of 2019 was the design-build contract for the construction of the Sibiu–Piteşti motorway in Romania. Another large-scale project is the 836m-long Minnevika Bridge near Eidsvoll in Norway. PORR acquired multiple new orders on its home market of Austria, including several in residential construction such as the Geiselbergstraße project in Vienna and Q6 Nord in Graz Reininghaus. In addition, the contract for the 64m-high residential tower Q218 was acquired in Berlin, while in Poland PORR won the tender for the office project SKYSAWA with a height of 155m.
Financial Performance
The construction industry is subject to seasonal fluctuations typical for the sector. The first half is traditionally weaker than the second and is thereby not necessarily indicative of the full year. The reason for this is the weaker construction output in the winter months that also affects earnings.
PORR has opted for the modified retrospective method when applying IFRS 16 for the first time from 1 January 2019. The impacts of this are laid out in detail from page 34 of the notes to the interim consolidated financial statements as of 30 June 2019.
Revenue totalled EUR 2,181.6m in the first half of 2019, a slight decrease of 1.9% against the comparable period of 2018. On the other hand, the increase in earnings from companies accounted for under the equity method was positive at 25.3%. Expenses for materials and other related production services underwent a sharper decline than revenue, decreasing by 4.9%, in contrast to the change in staff costs, which rose by 9.2%. Own construction costs (total expenses for staff and materials) climbed by 3.4%, while purchased services decreased by 5.6%.
EBITDA improved by EUR 23.0m to EUR 95.4m, partly because of the effects of IFRS 16. Depreciation, amortisation and impairment expense rose in the first half of 2019 – also as a result of applying IFRS 16 – by EUR 20.3m to EUR 78.1m. EBIT increased by EUR 2.7m to total EUR 17.4m as of 30 June 2019.
Financing costs, which increased due to higher interest on leases – necessitated by IFRS 16 – led to a EUR 1.1m decrease in the financial result to EUR -9.1m (1–6/2018: EUR -8.0m). Overall, this resulted in a EUR 1.6m rise in EBT to EUR 8.2m.
The slight increase in tax expense led earnings for the period to stand at EUR 6.0m at the end of the first half of 2019, a rise of EUR 0.4m against the comparable period of the previous year (EUR 5.6m).
Financial Position and Cash Flows
As of 30 June 2019, total assets stood at EUR 3,567.1m, thereby increasing by EUR 452.3m against 31 December 2018.
Property, plant and equipment climbed to EUR 917.0m, largely because of the first-time application of IFRS 16. This resulted in non-current assets of EUR 1,356.3m. The 10.0% increase in current assets partially reflects the seasonal effects on trade receivables.
Equity decreased in the first half of 2019, mainly because of the dividend payout and the adjusted interest rates when calculating social capital requirements. As of 30 June 2019, the equity ratio stood at 16.2% (12/2018: 19.9%).
The first-time application of IFRS 16 and the issues of Schuldscheindarlehen were behind a EUR 417.5m increase in non-current liabilities to EUR 991.2m. Current liabilities rose slightly by EUR 76.6m to EUR 1,999.5m.
Seasonal factors coupled with the additional effects from the first-time application of IFRS 16 caused net debt to climb to EUR 829.9m as of 30 June 2019 (06/18: EUR 613.8m). Under application of IFRS 16, net debt as of 31 December 2018 retrospectively stood at EUR 349.1m. Further details on IFRS 16 can be found in the notes to the interim consolidated financial statements from page 34.
The EUR 34.9m year-on-year increase in operating cash flow of EUR 85.2m mainly arose from the rise in deprecation, amortisation and impairment expense triggered by applying IFRS 16. Cash flow from operating activities of EUR -318.1m was EUR 137.1m below the comparable period of 2018, as the surplus liquidity in the first half of 2019 was used to settle liabilities to suppliers in order to safeguard relationships with suppliers long term.
Higher expenses for property, plant and equipment and investment property led to a EUR 63.7m decrease in cash flow from investing activities. In addition, there was an extraordinary influx in the comparable period from the repayment of a financial investment, which had a positive impact on cash flow from investing activities.
The sharp influx from increasing the Schuldscheindarlehen (EUR 203.0m) and rolling over credit financing was reflected in cash flow from financing activities.
As of 30 June 2019, cash and cash equivalents stood at EUR 136.8m.
Investments
In the first half of 2019 investments were made in drilling equipment in addition to the usual high investments to replace machinery and construction site equipment and to buy new equipment and property.
Investment activity is measured by applying the CAPEX indicator (capital expenditure). This includes investments in intangible assets, property, plant and equipment, and assets under construction including investments financed by leases. CAPEX increased against the comparable period of the previous year by EUR 57.0m. As of the 2019 business year, CAPEX includes all investments financed by leases (1–6/2019: EUR 42m), due to the first-time application of IFRS 16, while in the prior period it only contained investments involving finance leases (1–6/2018: EUR 19m). This resulted in a CAPEX ratio – partially caused by high investments in a storage site and construction equipment along with the strong growth achieved in the previous year – of 5.3% in relation to production output (1–6/2018: 3.1%).
The investment needs of the whole Group are continuously assessed in terms of economic viability.
Opportunity and Risk Management
Effective risk management has long been one of PORR's most important principles when carrying out any economic activity and safeguards its competitive ability. If risks have an impact on one of PORR's business fields or markets, this can have a negative effect on the company's earnings potential. That's why the aim of risk management is to identify risks and then minimise them while still maintaining the company's earnings potential.
Since the 2018 Annual Report there have been no significant changes to the Group's opportunity and risk profile that would result in new or amended risks for PORR. The description in the Risk Report of the 2018 Annual Report from page 61 onwards thereby remains valid.
Staff
In the first half of 2019 PORR employed 19,339 people on average. This represents an increase of 4.9% compared to the first half of the previous year, caused by the growth in output and the current order backlog.
Forecast Report
Both the IMF and the OECD have forecast weaker year-onyear growth for the global economy (3.2%) and the eurozone (1.2%) against a challenging backdrop dominated by uncertainty.
On the basis of current forecasts for the construction markets in Europe, on which the majority of PORR's business activities are focused, the company expects broadly stable growth, albeit with regional variation.
Austria and Germany – PORR's largest home markets – will remain at a high level, although they are partially limited by capacity bottlenecks. The construction industry in Switzerland is stable, with both civil engineering and commercial construction serving as key drivers.
The sector is set to continue to experience above-average growth in Central and Eastern Europe. Especially in Poland, however, the indicators do not suggest any easing up on issues such as the lack of skilled labour, subcontractor bottlenecks and the price levels of construction materials and wages. The pressure on margins will remain high in this competitive market as well as being hard to estimate.
In the UK, general economic uncertainty has led to weak construction activity. Norway promises bright opportunities in the infrastructure sector through its 2029 Investment Plan; that said, the market is extremely tough. In Qatar and the UAE, PORR is pursing a lower-risk strategy and thereby lower project volumes. Final negotiations on completed projects in Qatar are currently underway.
Strengthened by the high order backlog, PORR's strategy of intelligent growth remains in place unchanged. Its focus on the home markets is on selective order acquisition and operational excellence. On the basis of the aforementioned assumptions related to the home markets and the high order backlog, the Executive Board expects to achieve a moderate increase for the 2019 business year on the previous year's high output of EUR 5,593m.
The actual business performance may, however, deviate from current forecasts due to external political and economic factors as well as the seasonal nature of the construction industry.
Segment Report
Business Unit 1 – Austria, Switzerland
Key data
| in EUR m | 1–6/2019 | 1–6/2018 | Change |
|---|---|---|---|
| Production output | 1,227 | 1,199 | 2.3% |
| EBT | 17.9 | 13.7 | 29.9% |
| Order backlog | 2,542 | 2,381 | 6.7% |
| Order intake | 1,647 | 1,531 | 7.6% |
| Average staffing levels | 9,200 | 8,735 | 5.3% |
The segment Business Unit 1 – Austria, Switzerland (BU 1) covers PORR's permanent business on the two home markets of Austria and Switzerland. Here PORR is represented with its full range of services, whereby the primary focal points are residential and office construction, structural engineering and road construction and specialist civil engineering. The fields of environmental engineering and railway construction with the Slab Track Austria system are new additions as of 1 January 2019. Also integrated into BU 1 – alongside the existing equity interests (including IAT, BOMA and ÖBA) – are Prajo, TKDZ, Thorn, PWW and ALU-SOMMER. Furthermore, this segment includes German industrial construction as well as large-scale building construction projects on all international markets and the raw materials business.
In the first half of 2019, BU 1 generated production output of EUR 1,227m and thereby achieved an increase of EUR 28m or 2.3%. Particularly positive contributions came from the federal provinces of Styria, Carinthia and Upper Austria. The performance in Switzerland was favourable as well. The order backlog climbed by 6.7% against the previous year to EUR 2,542m, while the order intake also rose by 7.6% to EUR 1,647m. The largest new orders in the first half of 2019 included numerous residential construction projects such as Geiselbergstraße in Vienna or Q6 Nord in Graz Reininghaus. In addition, PORR won the tender to extend the S31 expressway in Burgenland.
The good order situation gives BU 1 a reason to be positive about the 2019 business year. Despite the market situation becoming more challenging – also because of economic performance – both Austria and Switzerland report high levels of construction investment. The Austrian Federal Guild of Construction (Bundesinnung Bau) and the Swiss Construction Industry Employers' Association (Baumeisterverband) have reported an increase in order intakes for the first half of 2019. PORR is resolutely pursuing its strategy of selective order acquisition and its focus on operational excellence.
Business Unit 2 – Germany
| Key data | |||
|---|---|---|---|
| in EUR m | 1–6/2019 | 1–6/2018 | Change |
| Production output | 445 | 436 | 2.1% |
| EBT | 2.1 | -8.1 | >100.0% |
| Order backlog | 1,522 | 1,637 | -7.0% |
| Order intake | 368 | 530 | -30.7% |
| Average staffing levels | 2,441 | 2,388 | 2.2% |
The majority of PORR's activities in Germany are bundled in the segment Business Unit 2 – Germany (BU 2). On its second largest market, the company offers foundation and structural engineering in addition to building construction and civil engineering. The acquisitions of recent years have given PORR a strong presence on the infrastructure market with its own qualified, specialist staff. PORR Oevermann gives PORR a particularly strong market presence in permanent business in the West region. By bundling building construction resources and knowhow
along regional lines, activities have become more efficient and customer-oriented since 2018.
In the first half of 2019, BU 2 generated production output of EUR 445m. This corresponds to a slight increase of EUR 9m or 2.1%, whereby the growth was triggered in particular by German structural engineering. The selective approach to acquisitions is reflected in the lower order backlog, which decreased by EUR 115m or 7.0% to EUR 1,522m. The order intake fell to EUR 368m. This represents a decline
of 30.7% or EUR 162m. The largest new order in the first half was the residential tower Q218 in Berlin.
Production output in the main German construction business grew by around 7.0% in the first half of the year. Demand for residential construction in particular remained high. Additional growth drivers in road and rail construction are expected in the medium term – especially from the 2030 Federal Transport Infrastructure Plan. The shortage of skilled labour and subcontractor bottlenecks continue to be factors limiting growth. Price pressure
remains high both in terms of labour and for raw materials and construction resources.
Despite the challenging market environment, the previously announced turnaround in Germany is underway. Here PORR deliberately only accepts orders that reflect the current market conditions and for which it has secure project teams already in mind. The focus in 2019 will remain on consolidating activities in order to guarantee a healthy performance that is also sustainable.
Business Unit 3 – International
| in EUR m | 1–6/2019 | 1–6/2018 | Change |
|---|---|---|---|
| Production output | 770 | 771 | -0.2% |
| EBT | -9.5 | -1.9 | >100.0% |
| Order backlog | 3,421 | 2,439 | 40.3% |
| Order intake | 910 | 556 | 63.8% |
| Average staffing levels | 5,890 | 5,686 | 3.6% |
The segment Business Unit 3 – International (BU 3) focuses on the home markets of Poland and the Czech Republic and on the project markets of Norway, Qatar, the UAE, Slovakia, Romania and Great Britain. In Poland and Romania PORR offers construction services in building construction and civil engineering, complemented by foundation engineering in Poland. The competencies for international tunnelling, railway construction and bridge building are also bundled in BU 3, as are the areas of international large-scale projects and international use of the Slab Track Austria system.
In the first half of 2019, BU 3 generated production output of EUR 770m, thereby holding steady compared to the previous year. Slovakia and the Czech Republic in particular made strong output gains. The order backlog of BU 3 also developed well. The order backlog climbed by 40.3% or EUR 982m to EUR 3,421m – partly because of the large-scale order for the Brenner Base Tunnel. The order intake rose even more rapidly in relative terms and stood at EUR 910m at the end of the period. This represents an increase of EUR 354m or 63.8%.
BU 3 acquired the largest new order in the first half of 2019: The design-build contract to extend the motorway in
Romania between Sibiu and Piteşti by a length of around 13.2 km. Additional success was achieved in Norway: the contract for the Minnevika Bridge and the construction of the E1 between Eggemoen and Åsbygda. New orders in Poland included the contract for the SKYSAWA office project in Warsaw.
The acquisition of Alpine Bau CZ a.s. in 2018 has opened up opportunities in traffic and transport construction in the Czech Republic as well as the chance to further expand permanent business there.
Poland remains BU 3's biggest challenge. In terms of demand, the EU Cohesion Fund serves as a positive driver and is facilitating a solid pipeline with new orders. At the same time, costs for construction materials subcontractor services and labour are at an all-time high. Any relief to the situation is not yet in sight.
Norway is planning to increase investment in infrastructure by 2029. That said, the market remains exceptionally tough. PORR has significantly reduced its project volumes in Qatar and the UAE and is now only involved on a very selective basis.
Interim Consolidated Financial Statements as of 30 June 2019
PORR Half-Year Report 2019|Interim Consolidated Financial Statement
- Consolidated Income Statement
- Statement of Comprehensive Income
- Consolidated Cash Flow Statement
- Consolidated Statement of Financial Position
- Statement of Changes in Group Equity
- Notes to the Consolidated Financial Statements
Consolidated Income Statement
| in TEUR | 1–6/2019 | 1–6/2018 | 4–6/2019 | 4–6/2018 |
|---|---|---|---|---|
| Revenue | 2,181,645 | 2,223,238 | 1,236,197 | 1,315,663 |
| Own work capitalised in non-current assets | 2,526 | 815 | 1,149 | -208 |
| Income from companies accounted for under | ||||
| the equity method | 30,984 | 24,718 | 18,247 | 16,761 |
| Other operating income | 109,029 | 95,404 | 57,662 | 48,703 |
| Cost of materials and other related production services | -1,424,810 | -1,498,906 | -801,696 | -890,174 |
| Staff expenses | -607,411 | -556,052 | -341,849 | -317,870 |
| Other operating expenses | -196,549 | -216,804 | -105,950 | -120,454 |
| EBITDA | 95,414 | 72,413 | 63,760 | 52,421 |
| Depreciation, amortisation and impairment expense | -78,054 | -57,762 | -40,108 | -29,548 |
| EBIT | 17,360 | 14,651 | 23,652 | 22,873 |
| Income from financial investments and other current | ||||
| financial assets | 7,416 | 4,828 | 4,674 | 2,977 |
| Finance costs | -16,563 | -12,874 | -8,271 | -6,202 |
| EBT | 8,213 | 6,605 | 20,055 | 19,648 |
| Income tax expense | -2,254 | -1,045 | -4,966 | -4,321 |
| Profit/loss for the period | 5,959 | 5,560 | 15,089 | 15,327 |
| of which attributable to shareholders of parent | 3,791 | 3,904 | 14,139 | 14,396 |
| of which attributable to holders of | ||||
| profit-participation rights | 1,332 | 1,332 | 666 | 666 |
| of which attributable to non-controlling interests | 836 | 324 | 284 | 265 |
| Basic (diluted) earnings per share, total (in EUR) | 0.13 | 0.14 | 0.49 | 0.50 |
Statement of Comprehensive Income
| in TEUR | 1–6/2019 | 1–6/2018 | 4–6/2019 | 4–6/2018 |
|---|---|---|---|---|
| Profit/loss for the period | 5,959 | 5,560 | 15,089 | 15,327 |
| Other comprehensive income | ||||
| Remeasurement from defined benefit obligations | -12,269 | - | -12,269 | - |
| Measurement of equity instruments | 133 | -1,365 | -40 | -1,289 |
| Income tax expense (income) on other comprehensive income | 3,114 | 341 | 3,157 | 322 |
| Other comprehensive income which cannot be reclassified to profit or loss (non-recyclable) |
-9,022 | -1,024 | -9,152 | -967 |
| Exchange differences | 1,006 | -380 | 916 | 659 |
| Gains/losses from cash flow hedges | ||||
| in the year under review | -307 | -181 | -154 | -197 |
| Income tax expense (income) on other comprehensive income | 77 | 45 | 39 | 49 |
| Other comprehensive income which can subsequently be | ||||
| reclassified to profit or loss (recyclable) | 776 | -516 | 801 | 511 |
| Other comprehensive income | -8,246 | -1,540 | -8,351 | -456 |
| Total comprehensive income for the period | -2,287 | 4,020 | 6,738 | 14,871 |
| of which attributable to non-controlling interests | 822 | 292 | 272 | 241 |
| Share attributable to shareholders of the parent and holders of profit-participation rights |
-3,109 | 3,728 | 6,466 | 14,630 |
| of which attributable to holders of profit | ||||
| participation rights | 1,332 | 1,332 | 666 | 666 |
| Share attributable to shareholders of the parent | -4,441 | 2,396 | 5,800 | 13,964 |
Consolidated Cash Flow Statement
| in TEUR | 1–6/2019 | 1–6/2018 |
|---|---|---|
| Profit/loss for the period | 5,959 | 5,560 |
| Depreciation, impairment and reversals of impairment on fixed assets and financial assets | 77,864 | 58,009 |
| Interest income/expense | 9,919 | 9,326 |
| Income from companies accounted for under the equity method | -7,372 | -2,650 |
| Dividends from companies accounted for under the equity method | 5,852 | 1,976 |
| Profits from the disposal of fixed assets | -8,187 | -6,955 |
| Increase/decrease in long-term provisions | 1,777 | -3,576 |
| Deferred income tax | -623 | -11,446 |
| Operating cash flow | 85,189 | 50,244 |
| Increase in short-term provisions | 19,080 | 1,498 |
| Decrease/increase in tax provisions | -5,587 | 10,902 |
| Increase in inventories | -13,850 | -20,375 |
| Increase in receivables | -362,107 | -348,512 |
| Decrease/increase in payables (excluding banks) | -33,773 | 118,662 |
| Interest received | 6,105 | 7,538 |
| Interest paid | -11,581 | -5,905 |
| Other non-cash transactions | -1,568 | 4,917 |
| Cash flow from operating activities | -318,092 | -181,031 |
| Proceeds from the disposal of intangible assets | 14 | 34 |
| Proceeds from sale of property, plant and equipment and disposal of investment property | 13,473 | 11,012 |
| Proceeds from the sale of financial assets | 12,558 | 2,012 |
| Proceeds from repayment of loans | 2,741 | 789 |
| Investments in intangible assets | -1,407 | -961 |
| Investments in property, plant and equipment and investment property | -93,359 | -61,809 |
| Investment in financial assets | -92 | -16,659 |
| Investment in loans | -3,410 | -3,297 |
| Repayment of other financial assets | - | 50,000 |
| Proceeds from the sale of consolidated companies less cash and cash equivalents | -5,388 | 1,392 |
| Payouts for the purchase of subsidiaries less cash and cash equivalents | -6,316 | 30 |
| Cash flow from investing activities | -81,186 | -17,457 |
| Dividends | -41,305 | -41,305 |
| Payouts to non-controlling interests | -1,033 | -630 |
| Proceeds from Schuldscheindarlehen | 203,000 | - |
| Repayment of Schuldscheindarlehen | -40,000 | - |
| Obtaining loans and other financing | 257,079 | 189,747 |
| Redeeming loans and other financing | -165,069 | -182,176 |
| Capital increase of non-controlling interests | 2,681 | - |
| Acquisition of non-controlling interests | - | -115 |
| Cash flow from financing activities | 215,353 | -34,479 |
| Cash flow from operating activities | -318,092 | -181,031 |
| Cash flow from investing activities | -81,186 | -17,457 |
| Cash flow from financing activities | 215,353 | -34,479 |
| Change to cash and cash equivalents | -183,925 | -232,967 |
| Cash and cash equivalents as of 1 Jan | 319,674 | 358,707 |
| Currency differences | 1,076 | -3,594 |
| Cash and cash equivalents as of 30 Jun | 136,825 | 122,146 |
| Tax paid | 8,465 | 1,535 |
Consolidated Statement of Financial Position
| in TEUR | 30.6.2019 | 31.12.2018 |
|---|---|---|
| Assets | ||
| Non-current assets | ||
| Intangible assets | 158,301 | 148,212 |
| Property, plant and equipment | 916,980 | 666,758 |
| Investment property | 68,684 | 65,971 |
| Shareholdings in companies accounted for under the equity method | 79,420 | 93,200 |
| Loans | 50,121 | 48,802 |
| Other financial assets | 42,150 | 41,576 |
| Other non-current financial assets | 19,381 | 25,026 |
| Deferred tax assets | 21,244 | 14,557 |
| 1,356,281 | 1,104,102 | |
| Current assets | ||
| Inventories | 96,901 | 82,798 |
| Trade receivables | 1,815,595 | 1,461,729 |
| Other financial assets | 114,064 | 97,188 |
| Other receivables and current assets | 47,379 | 49,220 |
| Cash and cash equivalents | 136,825 | 319,674 |
| Assets held for sale | 26 | 25 |
| 2,210,790 | 2,010,634 | |
| Total assets | 3,567,071 | 3,114,736 |
| Equity and liabilities | ||
| Equity | ||
| Share capital | 29,095 | 29,095 |
| Capital reserve | 251,287 | 251,287 |
| Hybrid capital | 152,661 | 155,290 |
| Other reserves | 94,713 | 135,974 |
| Equity attributable to shareholders of parent | 527,756 | 571,646 |
| Profit-participation rights | 41,292 | 42,624 |
| Non-controlling interests | 7,391 | 3,964 |
| 576,439 | 618,234 | |
| Non-current liabilities | ||
| Bonds and Schuldscheindarlehen | 338,306 | 175,586 |
| Provisions | 165,913 | 149,150 |
| Non-current financial liabilities | 424,185 | 188,142 |
| Other non-current financial liabilities | 1,838 | 3,079 |
| Deferred tax liabilities | 60,935 | 57,688 |
| 991,177 | 573,645 | |
| Current liabilities | ||
| Bonds and Schuldscheindarlehen | 56,337 | 56,290 |
| Provisions | 153,297 | 133,757 |
| Current financial liabilities | 147,851 | 49,840 |
| Trade payables | 1,140,206 | 1,154,351 |
| Other current financial liabilities | 44,530 | 41,257 |
| Other current liabilities | 424,457 | 449,098 |
| Tax payables | 32,777 | 38,264 |
| 1,999,455 | 1,922,857 | |
| Total equity and liabilities | 3,567,071 | 3,114,736 |
Statement of Changes in Group Equity
| in TEUR | Share capital |
Capital reserve |
Revaluation reserve |
Remeasurement from defined benefit obligations |
Measurement of equity instruments |
Foreign currency translation reserves |
|---|---|---|---|---|---|---|
| Balance as of 31 Dec 2017 | 29,095 | 251,287 | 7,723 | -27,286 | - | 1,240 |
| Restatement from the first-time application of IFRS 9 |
- | - | - | - | - | - |
| Restatement from the first-time application of IFRS 15 |
- | - | - | - | - | - |
| Balance as of 1 Jan 2018 | 29,095 | 251,287 | 7,723 | -27,286 | - | 1,240 |
| Total profit/loss of the year | - | - | - | - | - | - |
| Other comprehensive income | - | - | - | - | -32 | -633 |
| Total income for the period | - | - | - | - | -32 | -633 |
| Dividend payout | - | - | - | - | - | - |
| Income tax on interest of holders of hybrid/mezzanine capital |
- | - | - | - | - | - |
| Capital increase | - | - | - | - | - | - |
| Changes to the consolidated group/ acquisition of non-controlling interests |
- | - | - | - | - | - |
| Balance as of 30 Jun 2018 | 29,095 | 251,287 | 7,723 | -27,286 | -32 | 607 |
| Balance as of 31 Dec 2018 | 29,095 | 251,287 | 6,736 | -30,837 | -29 | 4,309 |
| Restatement from the first-time | ||||||
| application of IFRS 16 | - | - | - | - | - | - |
| Balance as of 1 Jan 2019 | 29,095 | 251,287 | 6,736 | -30,837 | -29 | 4,309 |
| Total profit/loss of the year | - | - | - | - | - | - |
| Other comprehensive income | - | - | - | -9,083 | 100 | 1,098 |
| Profit/loss for the period | - | - | - | -9,083 | 100 | 1,098 |
| Dividend payout | - | - | - | - | - | - |
| Income tax on interest of holders of | ||||||
| hybrid/mezzanine capital | - | - | - | - | - | - |
| Capital increase of | ||||||
| non-controlling interests | - | - | - | - | - | - |
| Changes to the consolidated group/ | ||||||
| acquisition of non-controlling interests | - | - | - | - | - | - |
| Balance as of 30 Jun 2019 | 29,095 | 251,287 | 6,736 | -39,920 | 71 | 5,407 |
| participation Non-controlling rights |
to shareholders of parent |
and non-retained profit |
Hybrid capital |
cash flow hedges |
available for sale – fair value reserve |
|
|---|---|---|---|---|---|---|
| 3,248 597,038 |
42,624 | 551,166 | 132,681 | 155,318 | -629 | 1,737 |
| - | - | - | 1,737 | - | - | -1,737 |
| - | - | -2,613 | -2,613 | - | - | - |
| 3,248 594,425 |
42,624 | 548,553 | 131,805 | 155,318 | -629 | - |
| 324 | 1,332 | 3,904 | -314 | 4,218 | - | - |
| -32 | - | -1,508 | -707 | - | -136 | - |
| 292 | 1,332 | 2,396 | -1,021 | 4,218 | -136 | - |
| -630 -41,935 |
-2,664 | -38,641 | -31,766 | -6,875 | - | - |
| - | - | 1,387 | 1,387 | - | - | - |
| 1,194 | - | - | - | - | - | - |
| -78 | - | -184 | -184 | - | - | - |
| 4,026 558,829 |
41,292 | 513,511 | 100,221 | 152,661 | -765 | - |
| 3,964 618,234 |
42,624 | 571,646 | 156,834 | 155,290 | -1,039 | - |
| -10 | - | -2,860 | -2,860 | - | - | - |
| 3,954 615,364 |
42,624 | 568,786 | 153,974 | 155,290 | -1,039 | - |
| 836 | 1,332 | 3,791 | -455 | 4,246 | - | - |
| -14 | - | -8,232 | -117 | - | -230 | - |
| 822 | 1,332 | -4,441 | -572 | 4,246 | -230 | - |
| -1,033 -42,338 |
-2,664 | -38,641 | -31,766 | -6,875 | - | - |
| - | - | 2,052 | 2,052 | - | - | - |
| 2,681 | - | - | - | - | - | - |
| 967 | - | - | - | - | - | - |
| 7,391 576,439 |
41,292 | 527,756 | 123,688 | 152,661 | -1,269 | - |
Notes to the Interim Consolidated Financial Statements as of 30 June 2019
1. General Information
The PORR Group consists of PORR AG and its subsidiaries. PORR AG is a public limited company according to Austrian law and has its registered head office at Absberggasse 47, 1100 Vienna. The company is registered with the Commercial Court of Vienna under reference number FN 34853f. The Group deals mainly with the planning and execution of all kinds of building and construction work, as well as the management and operations of buildings constructed for the Group's own account.
These interim consolidated financial statements of the PORR Group have been published in accordance with IAS 34 Interim Financial Reporting, using the standards of the International Accounting Standards Board (IASB), the International Financial Reporting Standards (IFRSs) adopted by the European Union, as well as the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) in addition to standards applicable for the first time as of 1 January 2019, especially IFRS 16. The impact of the first-time application of the new standards is described in item 3.
In accordance with IAS 34, these interim consolidated financial statements do not contain every comprehensive entry that is obligatory in the annual financial statements and therefore this interim report should be read in conjunction with the Annual Report of the PORR Group as of 31 December 2018. As per IAS 34, the consolidated results of the interim consolidated financial statements are not necessarily indicative of the annual results.
The reporting currency is the Euro, which is also the functional currency of PORR AG and of the majority of the subsidiaries included in these interim consolidated financial statements.
2. Consolidated Group and Acquisitions
The following six companies were consolidated in full for the first time in these interim financial statements:
| Because of acquisitions | Date of initial consolidation |
|---|---|
| Rumpelnig Immobilien GmbH | 1.1.2019 |
| ISHAP Gebäudedokumentations GmbH | 5.3.2019 |
| Reisinger Gesellschaft mbH | 9.4.2019 |
| Spenglerei Hangl Christof GmbH | 8.5.2019 |
| Alea GmbH | 14.5.2019 |
For two companies the number of shares sold meant that only significant influence remains and these were accounted for under the equity method. One company was eliminated through an intra-Group merger, while two companies were sold off in full and two companies were liquidated. The assets and liabilities where control was lost break down as follows:
| in TEUR | 2019 |
|---|---|
| Non-current assets | |
| Property, plant and equipment | 270 |
| Deferred tax assets | 68 |
| Current assets | |
| Inventories | 11 |
| Trade receivables | 990 |
| Other financial assets | 1,007 |
| Other receivables and current assets | 63 |
| Cash and cash equivalents | 7,377 |
| Non-current liabilities | |
| Provisions | -18 |
| Non-current financial liabilities | -179 |
| Deferred tax liabilities | -48 |
| Current liabilities | |
| Current financial liabilities | -48 |
| Trade payables | -800 |
| Other current financial liabilities | -235 |
| Other current liabilities | -7,124 |
| Tax payables | -8 |
Gains on sale amounting to TEUR 35 were recognised in income/expenses from financial assets. The fair value measurement of the remaining equity stake led to a gain of TEUR 62 and is recognised in companies accounted for under the equity method.
TEUR 109 was used to purchase a 100% stake in Rumpelnig Immobilien GmbH. The purchase price was settled in cash and provisionally allocated to the Group's liabilities and assets as follows:
| in TEUR | 2019 |
|---|---|
| Non-current assets | |
| Deferred tax assets | 5 |
| Current assets | |
| Trade receivables | 123 |
| Other receivables and current assets | 2 |
| Cash and cash equivalents | 16 |
| Non-current liabilities | |
| Deferred tax liabilities | -31 |
| Current liabilities | |
| Trade payables | -2 |
| Other current liabilities | -4 |
| Purchase price | 109 |
TEUR 1,112 was used to purchase 100% in Reisinger Gesellschaft mbH, of which TEUR 1,000 was settled in cash. The purchase price was allocated to the Group's liabilities and assets as follows:
| in TEUR | 2019 |
|---|---|
| Non-current assets | |
| Other intangible assets | 3 |
| Property, plant and equipment | 1,359 |
| Other financial assets | 2 |
| Deferred tax assets | 150 |
| Current assets | |
| Inventories | 206 |
| Trade receivables | 529 |
| Other financial assets | 13 |
| Other receivables and current assets | 10 |
| Cash and cash equivalents | 30 |
| Non-current liabilities | |
| Provisions | -37 |
| Deferred tax liabilities | -174 |
| Current liabilities | |
| Provisions | -71 |
| Current financial liabilities | -401 |
| Trade payables | -49 |
| Other current liabilities | -225 |
| Tax payables | -8 |
| Bargain purchase | -225 |
| Purchase price | 1,112 |
The acquisition contributed TEUR 225, which was recognised in other operating income. A reassessment was carried out prior to recognising the bargain purchase.
TEUR 40 was used to purchase 100% in Spenglerei Hangl Christof GmbH. The purchase price was settled in cash and allocated to the Group's assets and liabilities as follows:
| in TEUR | 2019 |
|---|---|
| Non-current assets | |
| Goodwill | 41 |
| Other intangible assets | 1 |
| Property, plant and equipment | 90 |
| Other financial assets | 5 |
| Deferred tax assets | 7 |
| Current assets | |
| Inventories | 56 |
| Trade receivables | 481 |
| Other financial assets | 81 |
| Other receivables and current assets | 19 |
| Non-current liabilities | |
| Non-current financial liabilities | -105 |
| Deferred tax liabilities | -7 |
| Current liabilities | |
| Current financial liabilities | -97 |
| Trade payables | -289 |
| Other current financial liabilities | -148 |
| Other current liabilities | -95 |
| Purchase price | 40 |
TEUR 3,109 was used to purchase 100% in Alea GmbH. The purchase price was settled in cash and allocated to the Group's assets and liabilities as follows:
| in TEUR | 2019 |
|---|---|
| Non-current assets | |
| Goodwill | 1,256 |
| Other intangible assets | 9 |
| Property, plant and equipment | 128 |
| Other financial assets | 197 |
| Other non-current financial assets | 34 |
| Deferred tax assets | 32 |
| Current assets | |
| Inventories | 2 |
| Trade receivables | 1,725 |
| Other financial assets | 26 |
| Other receivables and current assets | 14 |
| Cash and cash equivalents | 1,112 |
| Non-current liabilities | |
| Provisions | -142 |
| Non-current financial liabilities | -39 |
| Deferred tax liabilities | -274 |
| Current liabilities | |
| Current financial liabilities | -38 |
| Trade payables | -114 |
| Other current liabilities | -819 |
| Purchase price | 3,109 |
TEUR 4,000 was used to purchase a further 50% stake in ISHAP Gebäudedokumentations GmbH. The purchase price was settled in cash and allocated to the Group's assets and liabilities as follows:
| in TEUR | 2019 |
|---|---|
| Non-current assets | |
| Other intangible assets | 9,776 |
| Property, plant and equipment | 28 |
| Current assets | |
| Trade receivables | 198 |
| Other financial assets | 2 |
| Cash and cash equivalents | 791 |
| Non-current liabilities | |
| Deferred tax liabilities | -2,444 |
| Current liabilities | |
| Provisions | -16 |
| Trade payables | -10 |
| Other current financial liabilities | -75 |
| Other current liabilities | -65 |
| Tax payables | -185 |
| Fair value of the equity interest already held | -3,000 |
| Non-controlling interests | -1,000 |
| Purchase price | 4,000 |
The acquisition contributed TEUR 2,544, which was recognised in income from companies accounted for under the equity method.
The companies consolidated for the first time contributed TEUR -790 to earnings before taxes for the period and TEUR 2,002 to revenue.
A total of 48 (previous year: 44) domestic and 35 (previous year: 35) foreign associates and joint ventures were valued using the equity method.
3. Accounting and Valuation Methods
The accounting and valuation methods applied in the consolidated financial statements of 31 December 2018, which are presented in the notes to the consolidated annual financial statements, have been used, unmodified, in the interim report with the exception of the following standards and interpretations applied for the first time, whereby it is only the first-time application of IFRS 16 Leases that has had a significant impact:
| New standard or amendment | Date of publication by IASB |
Date of adoption into EU law |
Date of initial application |
|---|---|---|---|
| IFRS 16 Leases | 13.1.2016 | 9.11.2017 | 1.1.2019 |
| Amendments to IFRS 9 Prepayment Features with Negative Compensation | 12.10.2017 | 22.3.2018 | 1.1.2019 |
| IFRIC 23 Uncertainty over Income Tax Treatments | 7.6.2017 | 23.10.2018 | 1.1.2019 |
| Amendments to IAS 28 Long-term Interests in Associates and Joint Ventures | 12.1.2017 | 8.2.2019 | 1.1.2019 |
| Annual Improvements to IFRSs 2015-2017 Cycle | 12.12.2017 | 14.3.2019 | 1.1.2019 |
| Amendments to IAS 19 Plan Amendments, Curtailments or Settlements | 7.2.2018 | 13.3.2019 | 1.1.2019 |
IFRS 16 Leases
The standard specifies how to recognise, measure, present and disclose leases. IFRS 16 replaces the previous standard IAS 17 and three interpretations related to leases. The standard provides a single lessee accounting model, requiring lessees to recognise assets and liabilities for all leases unless the lease term is twelve months or less or the underlying asset has a low value (option to choose). On initial recognition the liability is discounted and in subsequent years it decreases through lease payments, while also increasing through unwinding. At the same time, a right of use (ROU) in the amount of the present value of future lease payments is capitalised and subsequently written down using the straight-line method. The previous differentiation between operating leases and finance leases is thereby no longer applicable. The standard was published in January 2016 and its application is obligatory for reporting periods beginning on or after 1 January 2019. IFRS 16 features different transition options. PORR has decided against early adoption and chosen the modified retrospective approach.
When applying IFRS 16 for the first time, PORR exercised its right to apply the expedients in accordance with IFRS 16.C10:
- Portfolio application could be applied to discount rates for leases with similar assets, similar remaining terms and similar economic conditions.
- No onerous leases were identified as of the changeover date and therefore no adjustment to ROU assets was required.
- Initial direct costs were not considered.
- Options for extension or cancellation were assessed at the point in time IFRS 16 was first applied.
As of 30 June 2019 the average interest rate was 2.02%.
The following table shows the impact as of 1 January 2019 on the items in the statement of financial position from the first-time application of IFRS 16:
| in TEUR | Consolidated statement of financial position as of 1.1.2019 |
Adjustment through first-time application of IFRS 16 |
Consolidated statement of financial position as of 31.12.2018 without adjustments for IFRS 16 |
|---|---|---|---|
| Assets | |||
| Property, plant and equipment | 862,819 | 196,061 | 666,758 |
| Non-current assets | 1,300,163 | 196,061 | 1,104,102 |
| Total assets | 3,310,797 | 196,061 | 3,114,736 |
| Equity and liabilities Other reserves |
133,089 | -2,885 | 135,974 |
| Equity | 615,349 | -2,885 | 618,234 |
| Non-current financial liabilities | 361,672 | 173,530 | 188,142 |
| Non-current liabilities | 744,290 | 170,645 | 573,645 |
| Current financial liabilities | 75,256 | 25,416 | 49,840 |
| Current financial liabilities | 1,948,273 | 25,416 | 1,922,857 |
| Total equity and liabilities | 3,310,797 | 196,061 | 3,114,736 |
As of 30 June 2019, the application of IFRS 16 led to the recognition of TEUR 336,185 in property, plant and equipment, TEUR 2,065 in investment property and TEUR 321,673 in financial liabilities.
No other standards and interpretations were published or adopted into EU law since the preparation of the consolidated financial statements as of 31 December 2018.
The interim consolidated financial statements of 30 June 2019 use the same consolidation methods and basis for currency exchange as were used in the annual financial statements as of 31 December 2018.
4. Estimates and Assumptions
Producing interim consolidated financial statements in accordance with IFRSs requires management to make estimates and assumptions which affect the amount and disclosure of assets and liabilities in the statement of financial position, income and expense, as well as entries regarding contingent liabilities in the interim report. Actual results may deviate from these estimates.
5. Seasonal Influence
In comparison to other industry sectors, the construction industry experiences seasonal variations with regard to revenue and profit due to weather-related factors. Revenue and profit are, as a rule, lower in the winter months than in the summer months. As a result of the fixed costs which exist, earnings are lower in the first two quarters than in the final two quarters. These seasonal fluctuations are less pronounced in building construction than in civil engineering and road construction.
6. Revenue
| BU 1 – | |||||
|---|---|---|---|---|---|
| in TEUR 1–6/2019 |
Austria, Switzerland |
BU 2 – Germany |
BU 3 – International |
Holding | Group |
| Revenue | |||||
| Building construction | |||||
| Commercial/office construction | 82,781 | 25,570 | 35,446 | - | 143,797 |
| Industrial engineering | 71,969 | 656 | 4,341 | - | 76,966 |
| Miscellaneous building construction | 172,011 | 78,248 | 60,447 | 2,248 | 312,954 |
| Residential construction | 203,337 | 59,583 | 19,726 | - | 282,646 |
| Civil engineering | |||||
| Railway construction | 29,445 | - | 71,848 | - | 101,293 |
| Bridge/overpass construction | 30,847 | 45,280 | 71,984 | - | 148,111 |
| Miscellaneous civil engineering | 183,541 | 119,922 | 37,724 | 5,250 | 346,437 |
| Road construction | 146,670 | 42,880 | 134,331 | - | 323,881 |
| Tunnelling | 61 | 51,477 | 149,232 | - | 200,770 |
| Other sectors | 147,195 | 31,335 | 28,662 | 37,598 | 244,790 |
| Revenue | 1,067,857 | 454,951 | 613,741 | 45,096 | 2,181,645 |
| Revenue recognised over time | 996,053 | 451,832 | 613,291 | 42,722 | 2,103,898 |
| Revenue recognised at a point of time | 71,804 | 3,119 | 450 | 2,374 | 77,747 |
| BU 1 – | |||||
| in TEUR 1–6/2018 |
Austria, Switzerland |
BU 2 – Germany |
BU 3 – International |
Holding | Group |
| Revenue | |||||
| Building construction | |||||
| Commercial/office construction | 87,492 | 63,616 | 58,621 | - | 209,729 |
| Industrial engineering | 72,168 | 9,088 | 13,650 | - | 94,906 |
| Miscellaneous building construction | 157,908 | 60,678 | 35,884 | 6,269 | 260,739 |
| Residential construction | 257,421 | 34,080 | 12,655 | - | 304,156 |
| Civil engineering | |||||
| Railway construction | 10,600 | 210 | 110,392 | - | 121,202 |
| Bridge/overpass construction | 34,967 | 36,352 | 79,557 | - | 150,876 |
|---|---|---|---|---|---|
| Miscellaneous civil engineering | 173,128 | 113,362 | 49,540 | 2,194 | 338,224 |
| Road construction | 149,271 | 67,914 | 127,980 | - | 345,165 |
| Tunnelling | - | 21,784 | 131,477 | - | 153,261 |
| Other sectors | 137,982 | 32,795 | 33,734 | 40,469 | 244,980 |
| Revenue | 1,080,937 | 439,879 | 653,490 | 48,932 | 2,223,238 |
| Revenue recognised over time | 1,017,112 | 436,074 | 653,490 | 47,540 | 2,154,216 |
| Revenue recognised at a point of time | 63,825 | 3,805 | - | 1,392 | 69,022 |
7. Earnings per Share
| in TEUR | 1–6/2019 | 1–6/2018 |
|---|---|---|
| Proportion of annual surplus relating to shareholders of parent | 3,791 | 3,904 |
| Weighted average number of issued shares and capital share certificates | 28,878,505 | 28,878,505 |
| Basic earnings per share = diluted earnings per share in EUR | 0.13 | 0.14 |
8. Share Capital
| No. 2019 | EUR 2019 | No. 2018 | EUR 2018 | |
|---|---|---|---|---|
| Ordinary bearer shares | 29,095,000 | 29,095,000 | 29,095,000 | 29,095,000 |
| Total share capital | 29,095,000 | 29,095,000 | 29,095,000 | 29,095,000 |
As proposed by the Executive Board and the Supervisory Board, the Annual General Meeting of PORR AG passed a resolution on 29 May 2019 to pay out a dividend of EUR 1.10 per share entitled to dividends as a result of the earnings for the business year 2018.
At the end of the reporting period, there were 216,495 treasury shares; this corresponds to 0.74% of the share capital.
9. Financial Instruments
The carrying amount of the financial instruments as per IFRS 9 corresponds to the fair value, with the exception of bonds subject to fixed interest rates (fair value hierarchy level 1), Schuldscheindarlehen subject to fixed interest rates (fair value hierarchy level 3), deposits from banks subject to fixed interest rates (fair value hierarchy level 3), and other financial liabilities subject to fixed interest rates (fair value hierarchy level 3).
| Carrying | Measured | Fair value other | Fair value | Fair value | |||
|---|---|---|---|---|---|---|---|
| in TEUR | Measurement category |
amount as of 30.06.2019 |
at amortised cost |
comprehensive income |
affecting net income |
Fair value hierarchy |
as of 30.6.2019 |
| Assets | |||||||
| Loans | AC | 28,353 | 28,353 | ||||
| Loans | FVTPL | 22,194 | 22,194 | Level 3 | 22,194 | ||
| Other financial assets | FVTOCI | 29,835 | 29,835 | Level 3 | 29,835 | ||
| Other financial assets | FVTPL | 1,088 | 1,088 | Level 3 | 1,088 | ||
| Other financial assets | FVTPL | 11,227 | 11,227 | Level 1 | 11,227 | ||
| Trade receivables | AC | 978,560 | 978,560 | ||||
| Other financial assets | AC | 131,551 | 131,551 | ||||
| Other financial assets | FVTPL | 107 | 107 | Level 1 | 107 | ||
| Derivatives (without hedges) | FVTPL | 1,362 | 1,362 | Level 2 | 1,362 | ||
| Cash and cash equivalents | 136,825 | 136,825 | |||||
| Liabilities | |||||||
| Bonds | |||||||
| at fixed interest rates | AC | 55,337 | 55,337 | Level 1 | 55,757 | ||
| Schuldscheindarlehen | |||||||
| at fixed interest rates | AC | 101,797 | 101,797 | Level 3 | 96,327 | ||
| at variable interest rates | AC | 237,509 | 237,509 | ||||
| Deposits from banks | |||||||
| at fixed interest rates | AC | 58,827 | 58,827 | Level 3 | 61,788 | ||
| at variable interest rates | AC | 188,551 | 188,551 | ||||
| Lease obligations 1 | 321,673 | 321,673 | |||||
| Other financial liabilities | |||||||
| at fixed interest rates | AC | 166 | 166 | Level 3 | 168 | ||
| Trade payables | AC | 1,140,206 | 1,140,206 | ||||
| Other financial liabilities | AC | 46,368 | 46,368 | ||||
| Derivatives (without hedges) | FVTPL | 756 | 756 | Level 2 | 756 | ||
| Derivatives (with hedges) | 2,063 | 2,063 | Level 2 | 2,063 | |||
| by category | |||||||
| Financial assets at amortised cost | AC | 1,138,464 | 1,138,464 | ||||
| Cash and cash equivalents | 136,825 | 136,825 | |||||
| Fair value through profit & loss | FVTPL | 35,222 | 35,222 | ||||
| Fair value through OCI | FVTOCI | 29,835 | 29,835 | ||||
| Financial liabilities at amortised cost | AC | 1,828,761 | 1,828,761 |
| Measurement | Carrying amount as of |
Measured at amortised |
Fair value other comprehensive |
Fair value affecting |
Fair value | Fair value as of |
|
|---|---|---|---|---|---|---|---|
| in TEUR | category | 31.12.2018 | cost | income | net income | hierarchy | 31.12.2018 |
| Assets | |||||||
| Loans | AC | 26,665 | 26,665 | ||||
| Loans | FVTPL | 22,224 | 22,224 | Level 3 | 22,224 | ||
| Other financial assets | FVTOCI | 29,692 | 29,692 | Level 3 | 29,692 | ||
| Other financial assets | FVTPL | 1,088 | 1,088 | Level 3 | 1,088 | ||
| Other financial assets | FVTPL | 10,796 | 10,796 | Level 1 | 10,796 | ||
| Trade receivables | AC | 853,476 | 853,476 | ||||
| Other financial assets | AC | 119,600 | 119,600 | ||||
| Other financial assets | FVTPL | 102 | 102 | Level 1 | 102 | ||
| Derivatives (without hedges) | FVTPL | 2,424 | 2,424 | Level 2 | 2,424 | ||
| Cash and cash equivalents | 319,674 | 319,674 | |||||
| Liabilities | |||||||
| Bonds | |||||||
| at fixed interest rates | AC | 55,291 | 55,291 | Level 1 | 56,614 | ||
| Schuldscheindarlehen | |||||||
| at fixed interest rates | AC | 53,876 | 53,876 | Level 3 | 54,454 | ||
| at variable interest rates | AC | 122,709 | 122,709 | ||||
| Deposits from banks | |||||||
| at fixed interest rates | AC | 46,026 | 46,026 | Level 3 | 49,428 | ||
| at variable interest rates | AC | 76,749 | 76,749 | ||||
| Lease obligations 2 | 113,160 | 113,160 | |||||
| Other financial liabilities | |||||||
| at fixed interest rates | AC | 45 | 45 | Level 3 | 44 | ||
| Trade payables | AC | 1,154,351 | 1,154,351 | ||||
| Other financial liabilities | AC | 44,336 | 44,336 | ||||
| Derivatives (without hedges) | FVTPL | 246 | 246 | Level 2 | 246 | ||
| Derivatives (with hedges) | 1,756 | 1,756 | Level 2 | 1,756 | |||
| by category | |||||||
| Financial assets at amortised cost | AC | 999,741 | 999,741 | ||||
| Cash and cash equivalents | 319,674 | 319,674 | |||||
| Fair value through profit & loss | FVTPL | 36,388 | 36,388 | ||||
| Fair value through OCI | FVTOCI | 29,692 | 29,692 | ||||
| Financial liabilities at | |||||||
| amortised cost | AC | 1,553,383 | 1,553,383 |
1 Lease obligations fall under the scope of IFRS 16.
2 Lease obligations fall under the scope of IAS 17 and IFRS 7.
Details on the fair value of financial instruments of Level 3
For the valuation of the hybrid capital of TEUR 25,330 for UBM Development AG, the following input factors (pricing criteria) were applied:
- Mid swap
- Credit spread UBM-bond (Z spread)
- Hybrid spread
The sum of these factors corresponds to the current pricing of the hybrid bond.
As a second step, the current pricing and contractually agreed coupon were compared, thereby determining the necessary surcharges/discounts.
- If the current market pricing is higher than the contractually agreed coupon, then a discount is applied to the nominal amount.
- If the current market pricing is lower than the contractually agreed coupon, then a surcharge is applied to the nominal amount.
This resulted in the following valuation as of 30 June 2019:
| Mid swap | Credit spread | Hybrid spread | Hybrid coupon in % |
|
|---|---|---|---|---|
| Balance as of 30 Jun 2019 | -23.5 | 262.09 | 368 | 6.07 |
| Balance as of 31 Dec 2018 | 19.6 | 271.57 | 368 | 6.6 |
| Hybrid capital | ||||
| Total 1 Jan 2019 | 25,179 | |||
| Disposals | - | |||
| Surcharges/discounts | 133 | |||
| Total 30 Jun 2019 | 25,312 |
Sensitivities and interrelationships
The valuation methods applied are subject to fluctuation of the three input factors. Any change in a single factor results in a respective change in value (e.g. if the mid swap increases by 1 BP, the receivable decreases in value by 1 BP).
Possible interdependencies have not been considered as it is not possible to assume either a significant negative or a significant positive correlation; therefore any individual change would increase the overall valuation in the respective amount.
Future expected cash flows were applied for the fair value valuation of a loan of TEUR 22,194, whereby the EUR zero-coupon curve was used for discounting the cash flows (as of 30 June 2019: -0.25423%).
10. Segment Report
The segment report has been adjusted in line with the new internal reporting structure. Comparative figures have been retrospectively amended to the new structure.
Segment BU 4 – Environmental Engineering, Healthcare & Services has been split. PORR Umwelttechnik GmbH, PRAJO, TKDZ, Thorn, PWW and ALU-SOMMER are now part of BU 1 – Austria, Switzerland. The equity interests PORREAL, STRAUSS Property Management and hospitals are part of the holding, as are activities in the PPP sector.
Railway construction with the Slab Track Austria System – within Europe – has moved from BU 3 – International to BU 1 – Austria, Switzerland; the Czech Republic has moved from BU 1 – Austria, Switzerland to BU 3 – International.
| BU 1 – | |||||
|---|---|---|---|---|---|
| in TEUR | Austria, | BU 2 – | BU 3 – | ||
| 1–6/2019 | Switzerland | Germany | International | Holding | Group |
| Production output (Group) | 1,226,743 | 445,102 | 769,679 | 55,191 | 2,496,715 |
| Segment revenue | 1,067,857 | 454,951 | 613,741 | 45,096 | 2,181,645 |
| Intersegment revenue | 21,388 | 3,908 | 344 | 62,432 | |
| EBT (Earnings before tax = | |||||
| segment earnings) | 17,853 | 2,095 | -9,483 | -2,252 | 8,213 |
| BU 1 – | |||||
|---|---|---|---|---|---|
| in TEUR | Austria, | BU 2 – | BU 3 – | ||
| 1–6/2018 | Switzerland | Germany | International | Holding | Group |
| Production output (Group) | 1,199,308 | 435,819 | 771,184 | 51,473 | 2,457,784 |
| Segment revenue | 1,080,937 | 439,879 | 653,490 | 48,932 | 2,223,238 |
| Intersegment revenue | 20,925 | 2,963 | 561 | 56,974 | |
| EBT (Earnings before tax = | |||||
| segment earnings) | 13,747 | -8,074 | -1,890 | 2,822 | 6,605 |
11. Related Party Disclosures
There have been no significant changes in relationships between related companies, or any resultant obligations or guarantees, since 31 December 2018.
Transactions in the business year between companies included in the PORR Group's consolidated financial statements and the UBM Group companies primarily relate to construction services. Furthermore, interest for the hybrid capital of TEUR 1,520 has been paid to PORR AG in the business year 2019.
In addition to subsidiaries and associates, related parties include the companies of the IGO-Ortner Group as they or their controlling entity has a significant influence over PORR AG through the shares which they hold, as well as the Strauss Group, as a member of the Executive Board of PORR AG has significant influence over it, as well as the Kapsch Group, as a member of the Executive Board of PORR AG holds a key position at the same time as having significant influence over PORR AG. In addition to people who have a significant influence over PORR AG, related parties also include the members of the Executive and Supervisory Boards of PORR AG as well as their close family members.
12. Audit Disclosure
These interim financial statements of the PORR Group have neither been audited nor subjected to an audit opinion.
13. Events after the End of the Reporting Period
No events subject to disclosure occurred after the end of the reporting period.
Vienna, 29 August 2019
The Executive Board Karl-Heinz Strauss Andreas Sauer Thomas Stiegler J. Johannes Wenkenbach
Statement of all Legal Representatives
We confirm to the best of our knowledge that the condensed interim financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the group as required by the applicable accounting standards and that the group management report gives a true and fair view of important events that have occurred during the first six months of the financial year and their impact on the condensed interim financial statements and of the principal risks and uncertainties for the remaining six months of the financial year and of the major related party transactions to be disclosed.
August 2019, Vienna
Karl-Heinz Strauss Chairman of the Executive Board and CEO
Andreas Sauer Executive Board member and CFO
J. Johannes Wenkenbach Executive Board member and COO
Thomas Stiegler Executive Board member and COO
Financial Calendar 2019
| 28.10.2019 | Interest payment and redemption PORR Corporate Bond 2014/1 (senior bond) |
|---|---|
| 28.10.2019 | Interest payment PORR Corporate Bond 2014/2 (hybrid bond) |
| 28.11.2019 | Publication Report on the 3rd Quarter 2019 |
Contact
Investor Relations and Strategy [email protected]
Group Communications and Marketing [email protected]
The 2019 Half-Year Report can be obtained free of charge from the company at 1100 Vienna, Absberggasse 47, and may be downloaded from the website https://porr-group.com/en/investor-relations/reporting/group-reports/.
Acknowledgements
Media proprietor
PORR AG 1100 Vienna, Absberggasse 47 T +43 50 626-0 [email protected] porr-group.com
Concept, text, design and editing
PORR AG Investor Relations and Strategy be.public Corporate & Financial Communications, Vienna
Produced with ns.publish by Multimedia Solutions AG, Zurich.
Photos
Astrid Knie (Executive Board photo), PORR AG (Danzermühl power plant, Fresenius Kabi, Widok Towers, Mönchhof wind park, Filstal Bridge, Himberg Recycling Center, Humber Crossing, Austrian Parliament), Tomas Maly (D11)
Printing DRUCKWERKSTATT Handels GmbH
Disclaimer
This half-year report also contains statements relating to the future which are based on estimates and assumptions which are made by managerial staff to the best of their current knowledge. Future-related statements may be identified as such by expressions such as "expected", "target" or similar constructions. Forecasts related to the future development of the Group take the form of estimates based on information available at the time of the interim report going to press. Actual results may differ from the forecast if they are shown to be based on inaccurate assumptions or are subject to unforeseen risks.
Every care has been taken to ensure that all information contained in every part of this half-year report is accurate and complete. The figures have been rounded off using the compensated summation method. We regret that we cannot rule out possible round-off, typesetting and printing errors.
This report is a translation into English of the half-year report issued in the German language and is provided solely for the convenience of English-speaking users. In the event of a discrepancy or translation error, the German-language version prevails.
construction . mas ter . pieces . building . master .pieces . buildi ng . master . pieces . building . master . pieces . building . master . pieces . building .
PORR AG Absberggasse 47 1100 Vienna T +43 50 626-0 porr-group.com
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