German construction company Hochtief AG (HOCFF.PK) Thursday reported a profit for 2012, compared to a loss last year, and announced plans to sell some businesses to return the company to a sustainable growth trajectory.
The company reported a consolidated net profit of 158.11 million euros ($207.71 million) compared with a loss of 160.29 million euros last year.
Profit after taxes were 385.58 million euros versus 167.89 million euros loss last year.
Pre-tax profit was 546.42 million euros compared with a loss of 126.96 million euros last year when the firm recorded 649.89 million euros related to shares of of equity-method associates and jointly controlled entities.
Sales for the year increased to 25.53 billion euros from 23.28 billion euros in the prior year.
New orders increased 24.1 percent to 31.49 billion euros with a growth of 27.2 percent in the International business even as orders dropped 7 percent in Germany.
The company announced a dividend distribution of 1 euros per share for fiscal 2012.
For 2013, profit before taxes and consolidated net profit are expected to be 10 percent to 20 percent better than in 2012, excluding non-operating items like restructuring charges and effects from disposals.
Hochtief expects new orders, work done and order backlog to normalize below the record levels in 2012.
Further, Hochtief announced a plan to serve four segments going forward: Energy infrastructure, Transportation infrastructure, Social and urban infrastructure and Contract mining.
The firm is considering the sale of its facility and energy management activities, which are part of Service Solutions in the European business, as these no longer fit the Group's strategic focus, although they generate stable returns.
The firm is also considering alternative strategic options for its subsidiaries HTP and formart, which come under the Real Estate Solutions segment at Hochtief Solutions as these businesses currently tie up considerable amounts of capital. The firm will also explore the possibility of strategic alliances here.
Hochtief said it continues to advance its existing plans to sell the airports business and its subsidiary aurelis that are part of Real Estate Solutions.
"I am firmly convinced that with these measures we can return HOCHTIEF to a sustainable growth trajectory, become more profitable and deliver on our guidance," Marcelino Fernández Verdes, Chairman of the Executive Board at Hochtief, said.
The stock closed up 1.9 percent on Wednesday at 55.54 euros.
by RTT Staff Writer
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