Budimex Sa · GPW:BDX
Budimex Sa — Budimex S A Shs — Q3 2021 Earnings Presentation
22 slides from Budimex Sa's earnings presentation, Oct 27, 2021
Slide 1: Investor Presentation 1-3Q'21
Investor Presentation 1-3Q’21
Slide 2: Market snapshot
= == =F aye en ANT ARAN al Market snapshot
Slide 3: Construction production by segment
Construction production by segment ▪ In 1-3Q’21 construction production in Poland increased by +4,9% y-o-y Comment ▪ In 3Q’21 the production noted strong positive y-o-y dynamics in both segments: +14,8% in general construction and +11,0% in infrastructure Construction and assembly production ’12 – ’
Slide 4: Production vs. net profit margin in construction
Production vs.net profit margin in construction ▪ High cost inflation combined with no real indexation impacted strongly margins of Comment big construction companies in in ’17-’18, but recent years have brought relief Construction production (companies > 9 employees) vs. net profit margin in constr
Slide 5: EBIT margin by size of construction company
EBIT margin by size of construction company 11,9% 10,6% 9,2% 8,7% 8,8% 8,2% 8,4% 7,9% 7,2% 7,5% 7,3% 7,1% 6,1% 5,2% 7,4% 4,9% 5,1% 7,1% 6,7% 4,1% 4,9% 4,1% 4,1% 3,5% 2,6% 2,4% 2,4% 1,5% 1,2% -0,5% '13 '14 '15 '16 '17 '18 '19 '20 1H'20 1H'21 10-49 employees 50-249 empoloyees >=250 employees Investor
Slide 6: Labour market
Labour market ▪ Wages in construction are still growing, but the dynamics in 3Q’21 was lower Comment compared to 2Q’21 Unemployment rate (%) Employment in construction (thous. employees) 10,0 510 483 8,0 470 5,6 6,0 419 430 4,0 390 2,0 0,0 350 09'16 03'17 09'17 03'18 09'18 03'19 09'19 03'20 09'20 03
Slide 7: Prices of main materials
Prices of main materials ▪ The trends in the prices of materials, in particular steel, oil and asphalt, are worrying Comment ▪ In the coming quarters, average profitability in construction may be under pressure Concrete Reinforcement steel 180 300 280 280 160 160 260 144 240 140 220 245 200 140 133
Slide 8: Budimex Group 1-3Q'21 results
Budimex Group 1-3Q’21 results
Slide 9: Group P&L – 1-3Q'21 vs. 1-3Q'20
Group P&L – 1-3Q’21 vs. 1-3Q’20 ▪ Our goal is to keep profitability above market rates that may be under pressure due to rising material costs Comment ▪ 1-3Q’21 consolidated net profit included positive impact of sale of Budimex Nieruchomości (542 M PLN) 1-3Q'21 1-3Q'20* ∆ Sales 5 534 5 617 -83 0 y-
Slide 10: P&L - results by segment (sales)
P&L - results by segment ▪ Group’s sales remained almost on the same level, while sales in services increased by 31% y-o-y and in the construction decreased by 7% Comment ▪ Lower pace of construction works was mainly due to difficult weather conditions, schedule of design works on D&B contracts and
Slide 11: P&L - results by segment (EBIT)
P&L - results by segment ▪ New contracts that have been signed over last 2 years improved the Comment profitability of backlog and contributed to the decent margin in 1-3Q’21 Quarterly EBIT in Budimex Group (M PLN) Construction Real estate 4,1% 6,1% 5,6% 5,4% 278 Presented on net profit level as 117
Slide 12: P&L – historical results
P&L – historical results ▪ Good financial results of Budimex Group in 1-3Q’21 are in line with our expectations Comment ▪ Despite difficult market conditions, we have achieved significant increase in Group’s EBIT within continuing operations Sales in Budimex Group (M PLN, historical data w/o develop
Slide 13: Evolution of Net Treasury Position
Evolution of Net Treasury Position ▪ In 09’21 consolidated net cash amounted to 2,8 bn PLN and included cash Comment from the sale of Budimex Nieruchomosci Net Treasury Position in Budimex Group (M PLN, historical data w/o developer segment) 2,82,8 2,3 2,1 2,0 1,9 1,8 1,7 1,7 1,61,6 1,5 1,4 1,41,4 1
Slide 14: Budimex S.A. on WSE
Budimex S.A. on WSE ▪ In 06’21, for 13th year in a row, Budimex paid a dividend of 426 M PLN (16,7 PLN per share) Comment ▪ In addition, in 10’21 we have made an advance payment for dividend for ’21 of up to 381 M PLN (half of individual net profit of Budimex S.A. for 1H21) Dividends paid (M PLN) ∑
Slide 15: Employment
Employment ▪ Generally, in 1-3Q’21 the Group slightly decreased the employment level Comment ▪ Taking control over FBSerwis Group in 07’19 increased employment of Budimex Group by ca. 1 000 people Employment in Budimex Group* Bx Group w/o FBS FBS 7 692 7 324 7 123 7 126 6 977 934 989 1 006 1 045 1 0
Slide 16: Construction segment – 1-3Q'21 results
Construction segment – 1-3Q’21 results
Slide 17: Construction segment - P&L
Construction segment - P&L ▪ EBIT margin of construction segment amounted to 5,4% Comment ▪ Observed increase of material prices does not significantly affect the profitability of our backlog due to price indexation, as well as prudent approach to offers 1-3Q'21 y-o-y dynamics Sales and EBIT margin
Slide 18: Construction segment – offers placed
Construction segment – offers placed ▪ Value of offers placed in 1-3Q’21 decreased y-o-y, mainly due to lower activity of Comment key public clients (GDDKiA & PKP PLK) Offers placed in Budimex Group (bn PLN) -11% 47,4 46,1 43,7 4,1 2,0 40,5 4,2 8,6 3,5 10,6 36,3 10,7 3,5 32,5 9,0 6,9 3,3 24,2 12,0 6
Slide 19: Construction segment – contracts signed
Construction segment – contracts signed ▪ In 1-3Q’21, Budimex acquired contracts worth 5,9 bn PLN, while the actual value of contracts pending amounts to over 1 bn PLN Comment ▪ Top contracts signed in 1-3Q’21 include S6 Leśnice – Bożepole Wielkie (584 M PLN), Tricity Metropolitan ring road I (581 M
Slide 20: Construction segment - backlog
Construction segment - backlog ▪ Actual backlog ensures full use of resources Comment ▪ Taking into account the value of contracts pending, which we plan to sign in the coming months, works front is secured till the end of ’23 Backlog in Budimex Group (bn PLN) 14,0 Share 0,6 12,7 5% 1,1 8% 10,8 3,3
Slide 21: Services segment – 1-3Q'21 results
Services segment – 1-3Q’21 results
Slide 22: FBSerwis – key financial data
FBSerwis – key financial data ▪ Sales structure in 1-3Q’21: Waste Management – 76%, Infrastructure Maintenance – 16%, Facility Management & Street Lightening – 9% Comment ▪ In 09’21, companies from the FBSerwis Group won another tender for waste management in the city of Warsaw Sales (M PLN) EBIT (M