German construction company Hochtief has reported a strong operating performance in 2018, with net profit up 29% year-on-year to €541 million.
Part of this profit was generated by the company’s 20% stake in Abertis, a Spanish road management company, with €84 million contributed to the final figures.
Operational net profit reached the company’s top end guidance target amounting to a figure of €521 million, up 15% on the previous year.
Sales for the year grew to €23.9 billion, a 6% nominal increase on the year before. Along with the increase in revenue, the company also reported growth of 4.1% on its margins.
The firm’s end of year order book reflected a balance of €47.3 billion, an increase of 7% year-on-year, once exchange rate movements were taken into account.
Going forward, Hochtief says that it has identified a pipeline of relevant projects for the company, valued at approximately €600 billion, in its key markets.
The company maintained that it would continue to be focused on risk management and generating cash-backed profits. In 2018, net cash from operating activities was at a sustained level of €1.4 billion, driven by a solid level of cash conversion. Hochtief said that due to positive development it ended the year with a €1.6 billion net cash position.
The company’s target for 2019 has been set for an operational profit of between €640 million to €680 million.
Company CEO Marcelino Fernández Verdes said that 2018 was another very successful year for Hochtief, “For the sixth consecutive year, we managed to increase our cash-backed operational net profit and we expect this positive trend to continue.”
Concerning the future, the company is looking to implement digital innovations into its work. One such innovation has been set up, known as Nexplore, a group-wide digital hub.
Verdes, said, “Looking ahead, Nexplore will lend us huge support in transitioning to an enhanced digital future for our group activities. The objective of Hochtief’s digital transformation is to create value for our clients and stakeholders by changing the way we work.”