Slide 1: Half Year Results 2018
Half Year Results 2018 growing . together Investor Presentation 29 August 2018
Slide 2: Disclaimer
Disclaimer • This presentation was prepared by PORR AG (the "Company") solely for use at investors’ meetings and is provided solely for informational purposes. • This presentation dates from 29 August 2018. The facts and information contained herein might be subject to revision in the future. Neithe
Slide 3: Highlights HY 2018
Highlights HY 2018 Favorable market sentiment in construction continues Progress on operational results – EBT up to EUR 6.6m (+66%) Order book of EUR 6.5bn remains on high level Net debt of EUR 413.8m impacted by seasonality Realignment in Germany: efficiency measures ongoing Outlook for 2018 unchan
Slide 4: Positive Prospects for Construction in Europe But Tough Environment
Positive Prospects for Construction in Europe But Tough Environment PORR well positioned to capitalize … but keeping an eye on market on market chances … challenges Austria and Switzerland on stable Labour shortage in all home markets growing path Germany with potential in industrial Rising labour c
Slide 5: Increasing Top Level of Output
Increasing Top Level of Output EURm >5,000 Strong HY performance of 4,738 +22.0% reflects PORR’s out- standing position in the home 3,925 markets 3,524 Positive contribution across all business units 2,458 Output of EUR 2.5bn in HY 18 on track to meet FY/18 guidance 2,015 Effect of large scale proje
Slide 6: Solid EBT Development in HY 2018
Solid EBT Development in HY 2018 EBT results over the last years EURm 91.1 85.3 81.1 EBT increased by around 66% to EUR 6.6m (HY/17: 4.0m) EBT margin improves to 0.3% Q4 (HY/17: 0.2%) Q4 Q4 Q3 Q3 Operating cost ratios (material1, 1,1% 1,3% staff) developed underproportionally Q3 despite high growth
Slide 7: Order Book at a High Level
Order Book at a High Level +14.6% Evolution of backlog (+14.6%) across all business units +2.5% 6.5 Order book characterized by increasing 6.4 number of large-scale projects Disciplined and selective approach for new project tenders Top 5 New Orders HY 2018 5.7 Selected Projects 1 Country EUR m 2 Pl
Slide 8: Net Debt Peaks Due to Seasonality
Net Debt Peaks Due to Seasonality EURm 500 Q2 net debt increase as a typical 1251 pattern in the construction seasonality 414 Underproportional net debt 375 +10.4% increase of EUR 39m (+ 10.4%) as 345 compared to strong output growth of 22.0% Repayment of UBM mezzanine in 147 Q2/18 contributed posit
Slide 9: Strategic Realignment in Germany: New Organizational Structure
Strategic Realignment in Germany: New Organizational Structure „Region North“ Regional approach for building Lead by construction Oevermann Hamburg Four strong regional centres with lean structures „Region Münster Streamlining of the organization, West“ Berlin reduction of one management layer Stand
Slide 10: Outlook 2018
Outlook 2018 Construction market remains positive for 2018 Production output of at least EUR 5bn for year-end 2018 Mid-term margin goal of EBT 3.0% unchanged Efficiency measures ongoing, focus on operational excellence Restraint acquisition policy Investor Presentation ● 29/08/2018 ● 10
Slide 11: About PORR
About PORR Investor Presentation ● 29/08/2018 ● 11
Slide 12: PORR as an Investment
PORR as an Investment • Market leader in Austria Strong Core • Strong footprint in five European home markets (87% of total) • Demand outperforms construction supply • Landmark projects across every sector USP • One-stop-shop: value chain in-house • Order backlog of EUR 6.5bn: full capacity utilisat
Slide 13: PORR – At a Glance
PORR – At a Glance Business Units Key Facts 2017 Markets AT/CH/CZ Production Employees 1 (home markets) EUR 4.7bn ~17,719 DE 2 (home market) Backlog EBT EUR 6.4bn EUR 85.3m International 3 (project market) PORR, a leading full service Environmental, provider in the construction 4 Home markets QA hea
Slide 14: No Change in Strategy – Focus on Execution
No Change in Strategy – Focus on Execution Intelligent Growth Leading in home markets 3% Not the biggest, Profitable project markets sustainable but the best Promising target markets EBT margin Focus on earnings Strict cost & risk Strong capital base instead on output management Leading role in Exce
Slide 15: Construction matters
Construction matters Ongoing urbanisation Infrastructure New Standards 80% of population to live in Infrastructure investment “Paperless” in construction urban areas in Europe by 2050 gap remains unleashes value ▪ Ongoing urbanization, high demand for infrastructure as well ageing infrastructure as
Slide 16: Construction with Steady Pattern of Growth in Europe
Construction with Steady Pattern of Growth in Europe %, index based 140 135 Poland 130 125 Czech 120 Republic 115 EC - 19 110 Austria Switzerland 105 Germany 100 95 2014 2015 2016 2017 2018 2019 2020 Source: 85th EUROCONSTRUCT Summary Report Investor Presentation ● 29/08/2018 ● 16
Slide 17: Total Construction Markets on a Growing Path
Total Construction Markets on a Growing Path 1,563 Home Markets (87% Production Share) 510.8 +1.3% CAGR 2018 Total Construction Market1 in EUR bn 2018 Total Construction 2017 - 2020 Market in EUR bn Project Markets (12% Production Share) 54.7 +5.2% CAGR 2018 Total Civil Engineering2 2017 – 2020 Mark
Slide 18: Selected Future Trends in Construction
Selected Future Trends in Construction high BIM Portfolio related impacts Improved materials War for talent Organisational Smart home In-house utilities impacts Apps Energy efficiency Green building Regional Relevance 3D printing impacts Urban mining Focus on core business Technological impacts Serv
Slide 19: 2018: Year of Consolidation
2018: Year of Consolidation 2019-2020 2018 YIELD 2013 – 2017 • Paperless site CONSOLIDATE • Transformation 2011 – 2012 • Bundle operations • Teamwork EXPAND • Integration • Innovation leader • Focus on operational RESET • Technical excellence • Fit for future excellence • Process & cost optimisation
Slide 20: PORR in 2018
PORR in 2018 STRONG CORE INTERNATIONAL OPERATIONAL THINK BEYOND • Five home • PORR competes • Focus on • Portfolio markets with internationally in operational complemented by strong local power selective projects excellence, activities driving in civil engineering project control, construction and •
Slide 21: Construction Boom – General Building
Construction Boom – General Building PHASE I PHASE II PHASE III (Growth) (Consolidation) (On-hold line) Bidding high selective very selective activity Pricing aggressive conservative very conservative strategy Risk high limited very limited appetite Order book growing leveling falling Investor Prese
Slide 22: General/Total Contractor with Expertise in Lean Construction
General/Total Contractor with Expertise in Lean Construction • PORR focus purely on construction and builds as much as possible itself Operation • Strong core competencies alongside the construction value chain (e.g. Lean Construction) Construction • Within single segments PORR develops unique exper
Slide 23: Addressing Critical Challenges for Operational Excellence
Addressing Critical Challenges for Operational Excellence Technology driven by increasing customer need and cost pressure PAPERLESS PLANNING/ LEAN CORE CALCULATION CONSTRUCTION • Paperless workflows • BIM 5D = 3D + time and • Full transparency save time and cost cost/quality • Minimize waste of • Ma
Slide 24: Building Information Modelling (BIM)
Building Information Modelling (BIM) Operations Design and engineering Building information support for renovation Data repository for analytics – and termination Concept optimized design Design Data platform Renovation Model input to simulation and for facility rapid prototyping management Lifecycl
Slide 25: LEAN @ BMW
LEAN @ BMW ALIGNMENT TO. CUSTOMER FEEDBACK. ▪ LEAN in Design & Construction ▪ Full Visibility (Live Track) ▪ Integrated BIM Model ▪ Stability through Takt Planning ▪ Collaboration and Partnering ▪ Zero Claims ▪ Supply Chain Involvement ▪ Zero Delay (off-site pre-produced material) ▪ Zero Days Schedu
Slide 26: Roadmap 2020: Selected Examples
Roadmap 2020: Selected Examples Reporting of non- E-Invoicing to financial KPIs customers with E-Commerce & (standard across the automatic booking Webshop group) Standardised plan-/ Digitalization of actuals comparison equipment on line item level maintenance process DIGITAL DIGITAL TRANSFORMATION T
Slide 27: M&A Activities by H1 2018
M&A Activities by H1 2018 Expertise Building Regional Expansion Operation Construction G&P Preparation Design Financial Engineering Investor Presentation ● 29/08/2018 ● 27
Slide 28: Corporate Sustainability
Corporate Sustainability DONE: KEY DATA 16/171 GOALS1 • Health: • Increased recycling (+35.8%) Vision Zero: accident frequency < 10 • Reduced energy use (-2.8%) Health management system • Reduced accident frequency (-31.4%) • Education • Improved value added (+15.6%) PORR Academy; 5% apprentic
Slide 29: Best Place to Work @ PORR
Best Place to Work @ PORR WAR FOR TALENT OUR ANSWER: BEST PLACE TO WORK - Concept Work&Life@PORR • Employees and clients require • Flexible models of working hours and leave highly flexible • Nursing and health support programs (smoke free organisations environment, annual health day) • OPEN SPACE o
Slide 30: Shareholder Structure
Shareholder Structure Ownership Structure Free Float – Geographical Split 14.3% 53.7% 30.2% 12.0% 46.3%1 10.6% 15.3% 6.2% 11.4% Syndicate (Strauss-Group, IGO-Ortner Group) Free float Austria Central and Northern Europe UK US Germany Other France 1 of which 5.85% Heitkamp Construction GmbH, 4.05% Wel
Slide 31: Financial Performance
Financial Performance Investor Presentation ● 29/08/2018 ● 31
Slide 32: Key Financials
Key Financials Key Earnings Figures (EURm1) HY 2018 %∆ HY 2017 Production output 2,457.8 22.0% 2,014.8 Revenue 2,223.2 25.5% 1,771.2 EBT 6.6 66.4% 4.0 Net profit 5.6 88.4% 2.9 Key Assets and Financial Figures (EURm) 30.06.2018 %∆ 31.12.2017 Total assets 2,997.3 3.9% 2,884.8 Equity 558.8 (6.4%) 597.0
Slide 33: Consolidated Income Statement
Consolidated Income Statement EUR m1 HY 2018 HY 2017 2017 % HY 18/17 Production output2 2,457.8 2,014.8 4,738.2 22.0% Revenue 2,223.2 1,771.2 4,292.9 25.5% Share of profit/loss of companies accounted for 24.7 18.6 59.2 32.8% under the equity method Cost of materials and other related production (1,4
Slide 34: Key Cost Ratios
Key Cost Ratios EUR m1 HY 2018 HY 2017 2017 ∆ HY 18/17 Production output2 2,457.8 2,014.8 4,738.2 442.9 Revenue 2,223.2 1,771.2 4,292.9 452.0 Ratio of profit/loss of companies (at equity) 1.0% 0.9% 1.3% 0.1 PP Material cost ratio3 (61.0%) (58.8%) (62.1%) (2.2 PP) Personnel cost ratio (22.6%) (23.2%)
Slide 35: Statement of Financial Position
Statement of Financial Position EUR m 30.06.2018 31.12.2017 31.12.2016 Non-current assets 1,029.6 1,037.1 801.3 Assets Current assets 1,967.7 1,847.6 1,560.8 Total assets 2,997.3 2,884.8 2,362.1 Equity1 558.8 597.0 440.9 Non-current liabilites 594.9 587.1 562.7 liabilities Equity & Current liabiliti
Slide 36: Business Units (1/2)
Business Units (1/2) BU 1 BU 2 BU 3 BU 4 AT/CH/CZ ENVIRONMENTAL, Production output GERMANY INTERNATIONAL per 30.06.2018 HEALTHCARE & SERV. Production1 1,144 Share: 47% 427 Share: 17% 748 Share: 30% 112 Share: 5% (in EUR m) • PORR’s largest • PORR’s 2nd largest • PORR’s unit for • PORR’s unit for bus
Slide 37: Business Units (2/2)
Business Units (2/2) Eur m % growth per Output Backlog Comments 30.06.2018 1,143.9 2,405 ▪ Sharp growth in Austria, especially in Salzburg, strong growth in the Czech Republic BU 1 ▪ Double-digit increase in order booking +18% +23% ▪ Positive outlook for FY 18 ▪ Notable boost of German 426.9 1,592 ▪
Slide 38: Maturity Profile of PORR's Financial Liabilities
Maturity Profile of PORR‘s Financial Liabilities 102 103 17 87 30 2 21 1 27 52 51 49 55 18 37 47 30 20 11 5 23 23 21 24 15 17 2018 2019 2020 2021 2022 from 2023 Loans Bonds SSD fix SSD floating Short term loans Short term project related Comment: Chart excludes leasing liabilities, FX-hedge-liabilit
Slide 39: Net Working Capital Development
Net Working Capital Development Inventories Trade Receivables Trade payables 1,301,576 930,029 1,032,040 785,630 73,274 74,739 121 91 992 1112 1273 1283 2016 2017 2016 2017 2016 2017 tEUR % of sales Net Working Capital: 2016: 217,673 6.4% +160bps 2017: 344,275 8.0% Main topics 2017: • Newly consolid
Slide 40: Landmark Projects
Landmark Projects Metro Green Line Doha Expressway S17 Ryki Europaallee Zürich Lots FAIR ring accelerator Darmstadt Country: QA Country: PL Country: CH Country: DE Value: EUR 943.6m Value: EUR 117.3m Value: EUR 152.5m Value: EUR 207.0m Schedule: 2013-2018 Schedule: 2014-2019 Schedule: 2015-2020 Sche
Slide 41: Top Intakes 2017/2018
Top Intakes 2017/2018 • Railroad E30 Kedzierzyn-Opole/PL/79.8m • Prelim. works FAIR ring acc./DE/207.0m • App. Buildg. MGC L. Böhm Street/AT/49.3m • Nowe Miasto Lubaw Ringroad/PL/62.1m • PPP Campus Berresgasse (School)/AT/42.5m • Office Bldg. Franklinturm, Zurich/CH/60.9m • Office Building Neue Spre
Slide 42: IR Information for PORR AG
IR Information for PORR AG Share Information Share price1 EUR 27.55 Market capitalisation EUR 801.6m Official market Vienna Stock Exchange Prime Market Number of shares outstanding 29,095,000 Ticker symbol POS VI ISIN AT0000609607 IR Contact Upcoming Events For further information please contact 29
Slide 43: Analyses & Coverage
Analyses & Coverage Research Reports Institution Analyst Price Target Recommendation Last Update Hauck & Aufhäuser Aliaksandr Halitsa 35.0 Buy 27.08.2018 Raiffeisen Markus Remis 30.0 Hold 06.06.2018 Centrobank Berenberg Bank Saravana Bala 28.0 Hold 30.05.2018 SRC Research Stefan Scharff 37.0 Buy 28.