The OHL Group ended the first half of the year with good operating results
July 30, 2014
The OHL Group ended the first half of 2014 with satisfactory operating results, reflected in the growth figures obtained in sales, 2%; EBITDA, 3.9%, and EBIT, 7.1%. However, the negative impact of non-recurring charges, higher financial expenses and a larger number of external shareholders has translated into a decline of 57.4% in the attributable net profit and of 36.1% in the recurring attributable net profit.
Turnover totaled 1,719.6 million euros. The 2% growth in this figure has been driven by the positive performance of OHL Construcción, whose sales increased 10.7% as the outcome of stepped-up activity, both internationally as well as in Spain. The international business of this division increased 9.7% in the half year, to the point of accounting for 82.1% of its total production. Likewise, its sales grew 11.6% in Spain, where the long period of several years of downturn due to the crisis appears to have come to an end.
In the case of OHL Concesiones, toll revenues grew 13% thanks to the positive trend in traffic flows and toll rates. Nevertheless, the total sales of this division were down 8.6%, due basically to the reflection in the books of the reduced construction activity (both its own as well as subcontracted work) in Mexico as the result of the completion and start-up of several concessions.
Sales by the rest of the divisions, grouped under Other Activities, dropped 29.9% due to the fact that the lndustrial Division finalized major projects in 2013 and that the replacement of its portfolio did not become strong until the end of the first half of 2014, when it increased +70%. This increase, together with the existing good prospects for contracting, will bring about a very substantial positive change in the short term.
Following these results, international operations in the OHL Group now account for 75.8% of sales, 95.9% of EBITDA and 86.5% of the total portfolio. The distribution of the sales in the first half of the year by geographical area is set out below:
- Central and South America: 28.6%
- Spain: 24.2%
- U.S.A. and Canada: 21.4%
- Central and Eastern Europe: 13.5%
- Middle East and North Africa: 12.0%
- Others: 0.3%
The increases of 3.9% in EBITDA and 7.1% in EBIT were obtained thanks to OHL Concesiones, whose EBITDA and EBIT have grown 10.8% and 9.6%, respectively. This positive outcome for OHL Concesiones has come about despite the 8.8% devaluation of the Mexican peso against the euro, which has reduced its EBITDA for the first half of the year by 31.6 million euros. At a constant exchange rate, the growth of the EBITDA figure for OHL Concesiones would have been 19.7%.
The attributable net profit was placed at 40.2 million euros, a figure which includes non-recurring losses in an accrued amount of 17.3 million euros. Excluding this effect, the recurring attributable net profit would have been 57.5 million euros.
Despite the good performance of the Group on the operating level, the recurring attributable net profit was reduced by 32.5 million euros, 36.1%, with respect to June 2013, due mainly to two factors: a poorer financial result to the extent of 43.2 million euros (30.2 after taxes) and an increase in the result attributed to external shareholders in the amount of 18 million euros, stemming mainly from having reduced its 73.85% interest in OHL México to 63.64% following the capital increase in July 2013.
The Group ended the first half of 2014 with a total portfolio worth 66,014 million euros, up 10.9% with respect to the figure at the end of 2013. OHL Construcción accounts for 9,109 million of this portfolio and OHL Concesiones, 56,322.8 million; with increases of 13% and 10.4%, respectively.
In the financial context, in the framework of the policy of ongoing optimisation of the Group’s financial structure, in March of this year OHL successfully completed a Eurobond issue in the amount of 400 million euros maturing in 2022. The bonds were issued at par with an issue coupon accruing 4.75% fixed interest, the lowest in OHL’s entire history in the Euromarket, where it commenced operations in 2007, as investment grade.
THE OHL GROUP IN JANUARY-JUNE 2014
| CONSOLIDATED FIGURES | Millions of euros (M€) | Var. 1H 2014 / 1H 2013 | Margin on sales (%) | |
|---|---|---|---|---|
| 1H 2014 | 1H 2013 | |||
| Turnover | 1,719.6 | 2.0% | 100.0 | 100.0 |
| EBITDA | 489.7 | 3.9% | 28.5 | 28.0 |
| EBIT | 407.2 | 7.1% | 23.7 | 22.6 |
| Net profit | 40.2 | -57.4% | 2.3 | 5.6 |
| Recurring net profit | 57.5 | -36.1% | 3.3 | 5.3 |
| Total Portfolio | 66,014.0 | 10.9% | — | — |
PERFORMANCE BY ACTIVITY
| Activity | Sales (M€) | Var. 1H 2014 / 1H 2013 | EBITDA (M€) | Var. 1H 2014 / 1H 2013 |
|---|---|---|---|---|
| Concessions | 223.0 | -8.6% | 396.2 | 10.8% |
| Construction | 1,325.3 | 10.7% | 100.7 | -4.3% |
| Other activities | 171.3 | -29.9% | -7.2 | -183.7% |
| TOTAL | 1,719.6 | 2.0% | 489.7 | 3.9% |