Earnings up at Hochtief

Hochtief has announced a 17.3% rise in earnings before taxes for the first quarter of 2014, amounting to €134 million.

Net profit for the German contractor also jumped, up 22.7% to €53.3 million following a solid performance from all operational units.

CEO Marcelino Fernández Verdes said, “It is my clear objective to systematically pursue the path we have embarked upon and to push ahead our group-wide reorganisation.

"The focus throughout is on sustained cash profitability, an improved approach to risk management and a strong balance sheet. This is the way to enhance the value of Hochtief.”

New orders totalled €5.69 billion, up 18.7% on the same period in 2013, while total backlog was €40 billion, slightly higher than at the end of 2013.

The company is focusing on its core business of delivering complex infrastructure projects. Key business wins have included the extension of the Anaheim Convention Centre in California for Turner; a large follow-on contract as part of the Ruskin Dam upgrade secured by Flatiron; and a contract for tunnel buildings, systems and fitting out works with the Central-Wanchai Bypass tunnel in Hong Kong for Hochtief Asia Pacific.

In the Middle East, Habtoor Leighton Group is to build a 56km stretch of freeway near the Qatari capital, Doha.

In Europe, Hochtief has disposed of non-core activities, namely its 50% stake in Aurelis.

Meanwhile, Hochtief is looking to increase its stake in Australian subsidiary Leighton, from its current stake of 59% to 74.2% for a cash consideration of €800 million. The deal is yet to be approved.

Nikolaus Graf von Matuschka has been appointed as a new member of the Hochtief executive board and as the new CEO of Hochtief Solutions. In addition, José Ignacio Legorburo has been appointed as a new member of both executive boards and will take on the role of COO at Hochtief and Hochtief Solutions.

Graf von Matuschka has held various management positions at Hochtief since 1998, most recently as a member of the Hochtief Solutions executive board since February 2013.

Legorburo has worked for more than 25 years in the European construction sector. Most recently, he headed the ACS construction subsidiary Dragados as European managing director.