French construction giant Vinci SA (VCISF.PK, VCISY.PK), Tuesday reported a lower profit for the first half of 2012, hurt mainly by special charges. Going ahead, the company warned of the European economic crisis, and remains cautious for rest of the year.
Vinci said its revenues grew 3.6 percent to $17.94 billion euros from $17.32 billion euros last year. Revenue for the quarter was driven mainly on organic growth of 1.6 percent, acquisitions and a weak euro. On a comparable basis, revenues grew 1.6 percent.
Segment wise, Contracting business, which includes Energy business line, Eurovia, and Vinci Construction, revenues grew 3.5 percent driven by particularly strong performances at VINCI Construction France and the start-up of work at the Tours-Bordeaux high speed rail link.
At Concessions segment, revenues climbed 1.2 percent with Vinci Autoroutes up 0.6 percent and Vinci Concessions up 3.8 percent.
Vinci, Europe's largest construction company by revenue, said profit for the period dropped to 784 million euros or 1.44 euro per share from 814 million euros or 1.48 euro per share last year.
First-half 2012 profit includes a charge of 35 million euros related to profit sharing bonus and also an exceptional 5 percent increase in taxes. Together, these two items combine for an estimated negative impact of 37 million euros. Excluding one-time items, adjusted earnings improved 1 percent to 821 million euros or 1.51 euro per share.
Looking forward, Vinci remained cautious and warned about the second half results. The company in a statement said, "In an economic context marked by the sovereign debt crises of several European Union countries, global economic activity could deteriorate in the 2nd half of 2012. At the same time, several European states are increasing fiscal discipline in order to reduce their public deficits. New business-related tax and social charge increases in France have been announced.
Vinci currently predicts full-year 2012 revenues to slightly increase and expects profit to remain flat with 2011 levels.
The company has declared an interim dividend of 0.55 euro per share for 2012 to be paid on November 15, 2012.
VCISY is trading at $10.72, down $0.03 or 0.33%, OTC.
For comments and feedback: editorial@rttnews.com