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Implenia AG / Key word(s): Half Year Results
Ad hoc announcement pursuant to Art. 53 LR
Dietlikon, 17 August 2021
Division Real Estate achieved EBIT of CHF 22.3 million (HY1.2020: reported EBIT CHF 107.5 million; positively affected by Ina Invest transaction). The Division continues to invest in and develop an attractive real estate portfolio with a market value of more than CHF 350 million as trader developer in Switzerland and in Germany, e.g. the site acquisition 'Marienplatz' in Darmstadt. Together with partners the Division realizes its aspiration for standardised, industrially manufactured real estate products. The collaboration with Ina Invest is well established in the areas of acquisition and real estate services. Implenia's participation in Ina Invest has a book value of CHF 144.8 million.
Division Buildings delivered a solid performance and increased profitability from its underlying business. The Division reports EBIT of CHF 16.2 million (HY1.2020: CHF 5.4 million). Due to the focus on profitability, and on large-scale complex projects revenue decreased to CHF 854 million (HY1.2020: 1,001 million). The order book improved in quality and increased to CHF 3,148 million (HY1.2020: CHF 2,646 million) mainly influenced by the acquisition of BAM Swiss AG in May. With this acquisition, the Division strengthened its expertise for complex projects mainly in healthcare. In addition, the Division built up further capabilities in general planning and consulting.
Division Civil Engineering reports EBIT of CHF 10.2 million (HY1.2020: CHF -48.0 million). The transformation is well on track with an improved operating result as a first proof. The Division is now well positioned for future success. The business units Tun¬nelling and Special Foundations are delivering good results for the Division. The restructuring measures and ramp-downs in Civil are proceeding as planned and have mostly been completed. The Division's revenue increased to CHF 1,040 million (HY1.2020: CHF 927 million), based on a strong second quarter, especially June and the strategic focus on large-scale projects. The order book remained at previous year's level of CHF 3,301 million (HY1.2020: CHF 3,349 million) and is of improved quality. Based on the win of the tunnelling project TELT Lot 3 (Tunnel Euralpin Lyon-Turin), France will remain an important market for Tunneling and related infrastructure projects.
The strategic portfolio alignment in business unit Civil is on track - the following divestments have been completed: Implenia Instandsetzung GmbH in Germany, yards and equipment in Austria as well as the ferry dock maintenance and rock support business in Norway. Further externalisation of yards and equipment is being assessed and the business unit closed its local production units in Canton Grisons, Switzerland. Local branches of business unit Civil in Sweden, Norway and Austria have been ramped down to purely complete current projects.
Division Specialties reports EBIT of CHF 0.5 million (HY1.2020: CHF -0.6 million). Revenue was at CHF 95.8 million (HY1.2020: CHF 104.9 million). The order book remained stable at CHF 166.1 million (HY1.2020: CHF 170.4 million), despite the sale of two non-strategic businesses, Tüchler Ausbau and Tetrag. The Division will continue to develop and scale businesses with high potential and actively scouts acquisition prospects in order to expand its planning and engineering capabilities. The Implenia Innovation Hub is developing already more than seventy promising innovations at various stages of maturity.
Order book of CHF 6.6 billion with strategically relevant project wins is of better quality and improved risk profile by applying Value Assurance
During the first six months of this year Implenia has acquired a high number of large, complex infrastruc¬ture projects in strategic markets. These project acquisitions are in line with the Group's core competencies. Furthermore, they prove the recognition and demand for Implenia's long standing experience and capabilities in tunnelling. Examples are: A7 Altona Noise Protection Tunnel (Germany), Lysaker-Fornebu Tunnel (Norway), Sofia Station on the Stockholm Metro (Sweden) and two sections of preparatory work for the second tube of the Gotthard road tunnel (Switzerland).
Division Buildings won several large and complex projects in Switzerland and Germany for sustainable residential and commercial buildings. Examples are: Temporary Laboratory at Irchel Campus (Zurich), ka3 office, hotel and retail com¬plex (Karlsruhe), sustainable rental housing at Turley-Areal (Mannheim) and commercial and residential buildings BahnStadt (Bruchsal). According to the strategy, there is a shift from construction production towards projects with a substantial share of consulting and planning work.
Implenia is going through a major transformation including portfolio adjustments, restructuring with layoffs, as well as write-downs and rightsizing of businesses and support functions. The company continues to focus on integrated construction and real estate services in its core markets Switzerland and Germany and offers tunnelling and related infrastructure projects in other markets. In implementing this, the Group made strong progress in its strategic priority 'Portfolio'. In the business unit Civil the measures have mostly been completed. Implenia will continue with portfolio adjustments and externalisation of asset-heavy activities in the second half of the year.
For Implenia's core markets, the most recent market size predictions remain positive. Expected recovery of total construction output in 2021 of approx. 4.1% growth across Europe was slightly revised to a growth of 3.8% for 2021. Total construction output is expected to gradually lose momentum in the following years with 3.0% growth in 2022 and 2.1% in 2023 (source: Euroconstruct Report, June 2021).
Actively managing increase of material costs
Sustainability - a key element of Implenia's value proposition
Equity ratio increased versus full-year 2020 despite seasonality. Cash and equity with positive trend for second half-year
Despite seasonality of first half-year, the equity ratio increased by 0.8 pp to 11.1% (versus decrease of 2.5 pp in HY1.2020). Implenia aims for a continuous sustainable improvement of the equity ratio with a mid-term ambition of above 20%, based on the strong underlying business, including increasing earnings from Ina Invest and on a consistent asset-light strategy. Furthermore, there is an upside potential from Implenia's real estate portfolio.
Half-Year Report 2021: Please refer to this link to read or download the Half-Year Report 2021.
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As Switzerland's leading construction and real estate service provider, Implenia develops and builds homes, workplaces and infrastructure for future generations in Switzerland and Germany. It also plans and builds complex infrastructure projects in Austria, France, Sweden and Norway. Formed in 2006, the company can look back on around 150 years of construction tradition. The company brings together the know-how of its highly skilled consulting, planning and execution units under the umbrella of an integrated leading multinational construction and real estate service provider. With its broad offering and the extensive experience of its specialists, the Group can realise complex major projects and provide customer-centric support across the entire life-cycle of a building or structure. It focuses on customer needs and on striking a sustainable balance between commercial success and social and environmental responsibility. Implenia, with its headquarters in Opfikon near Zurich, employs more than 8,500 people in Europe and posted revenue of almost CHF 4 billion in 2020. The company is listed on the SIX Swiss Exchange (IMPN, CH0023868554). More information can be found at implenia.com.
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