{"id":155219,"date":"2023-10-31T08:20:04","date_gmt":"2023-10-31T08:20:04","guid":{"rendered":"https:\/\/bdm-stg.mda.pl\/informacje-prasowe\/commentary-by-artur-popko-president-of-the-management-board-of-budimex-sa-on-the-financial-data-of-the-budimex-group-for-the-first-three-quarters-of-2023\/"},"modified":"2024-06-07T11:22:31","modified_gmt":"2024-06-07T11:22:31","slug":"commentary-by-artur-popko-president-of-the-management-board-of-budimex-sa-on-the-financial-data-of-the-budimex-group-for-the-first-three-quarters-of-2023","status":"publish","type":"press","link":"https:\/\/bdm-stg.mda.pl\/en\/press\/commentary-by-artur-popko-president-of-the-management-board-of-budimex-sa-on-the-financial-data-of-the-budimex-group-for-the-first-three-quarters-of-2023\/","title":{"rendered":"Commentary by Artur Popko, President of the Management Board of Budimex SA, on the financial data of the Budimex Group for the first three quarters of 2023"},"content":{"rendered":"\n<section id=\"block_eff75855bd1662e5e451b2432bd71e73\" class=\"text-block   -hide-dots section-margin-120\">\n    <div class=\"container\">\n        <div class=\"row\">\n            <div class=\"col-24 col-lg-16\">\n                                    <p class=\"typo-18 under-p-medium color-gray-120 text-block__date\">31.10.2023<\/p>\n                                                    <div class=\"text-block__top-texts under-h2\">\n                        <h2 class=\"text-block__title under-p-big\">Commentary by\u00a0Artur Popko, President of the Management Board of Budimex SA, on\u00a0the financial data of the Budimex Group for the first three quarters of 2023<\/h2>\n                                                    <p class=\"typo-18 under-p-medium color-gray-120\">\n                                \n<div class=\"card-share card-share--flex\">\n    <div class=\"card-share__inner\">\n        <p class=\"card-share__title typo-18\">Share article<\/p>\n        <div class=\"card-share__links\">\n            <div class=\"card-share__link card-share__link--facebook\">\n                <a href=\"https:\/\/www.facebook.com\/sharer\/sharer.php?u=https:\/\/bdm-stg.mda.pl\/en\/press\/commentary-by-artur-popko-president-of-the-management-board-of-budimex-sa-on-the-financial-data-of-the-budimex-group-for-the-first-three-quarters-of-2023\/\" target=\"_blank\">\n                    <span class=\"card-share__linkIcon icon icon-facebook d-flex\"><\/span>\n                <\/a>\n            <\/div>\n            <div class=\"card-share__link card-share__link--linkedin\">\n                <a href=\"https:\/\/www.linkedin.com\/shareArticle?mini=true&#038;url=https:\/\/bdm-stg.mda.pl\/en\/press\/commentary-by-artur-popko-president-of-the-management-board-of-budimex-sa-on-the-financial-data-of-the-budimex-group-for-the-first-three-quarters-of-2023\/\" target=\"_blank\" rel=\"nofollow\">\n                    <span class=\"card-share__linkIcon icon icon-linkedin\"><\/span>\n                <\/a>\n            <\/div>\n            <div class=\"card-share__link card-share__link--twitter\">\n                <a href=\"https:\/\/twitter.com\/intent\/tweet?url=https%3A%2F%2Fbdm-stg.mda.pl%2Fen%2Fpress%2Fcommentary-by-artur-popko-president-of-the-management-board-of-budimex-sa-on-the-financial-data-of-the-budimex-group-for-the-first-three-quarters-of-2023%2F\" target=\"_blank\" rel=\"nofollow\">\n                    <span class=\"card-share__linkIcon icon icon-x\"><\/span>\n                <\/a>\n            <\/div>\n        <\/div>\n    <\/div>\n<\/div>                            <\/p>\n                                            <\/div>\n                                                                                    <div class=\"text-block__text text-editor\"><p style=\"text-align:justify\"><strong>We\u00a0recorded an increase in\u00a0the Group\u2019s sales revenues, both in\u00a0the construction and service parts. We\u00a0also improved profitability.<\/strong><\/p>\n<p style=\"text-align:justify\">After three quarters of 2023, the Budimex Group generated an operating profit of PLN 482 million. After three quarters, the operating profitability reached 6.9%. The Budimex Group ended the third quarter of 2023 with a\u00a0high net cash position, exceeding PLN 2.8 billion. Bearing in\u00a0mind the record level of projects awaiting signing, we\u00a0are confident about the level of utilization of our production capacity in\u00a0the next 2-3 years.<\/p>\n<p style=\"text-align:justify\">We\u00a0continue to\u00a0diversify our business and invest in\u00a0the development of competences. \u00a0With\u00a0 courage and responsibility, we\u00a0are involved in\u00a0the development of foreign markets, achieving more and more ambitious goals. During the first three quarters of 2023, we\u00a0obtained contracts worth over PLN 4.5 billion.<\/p>\n<p style=\"text-align:justify\">The Budimex Group\u2019s order book at\u00a0the end of September 2023 exceeds PLN 12 billion. The value of projects awaiting signing, where our company\u2019s offer took first place in\u00a0tender procedures, is currently over PLN 12 billion, of which over PLN 8 billion was attributable to\u00a0contracts on\u00a0foreign markets: the Czech Republic, Slovakia and Latvia. \u2018<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" style=\"margin:10px auto\" src=\"https:\/\/d2xhqqdaxyaju6.cloudfront.net\/file\/attachment-s\/2571046\/7e\/s-800-x.png\" alt=\"Q3 2023 1\" width=\"800\" height=\"451\"><\/p>\n<p style=\"text-align:justify\">We\u00a0also \u00a0recorded a\u00a0year-on-year increase in\u00a0the Group\u2019s sales revenues, both in\u00a0the construction part (+9.2%) and in\u00a0the service part (+16.4%).<\/p>\n<p style=\"text-align:justify\"><strong>Construction and assembly production for the first three quarters of 2023 <br \/><\/strong>(in\u00a0current prices) <strong>increased year-on-year by\u00a013.2% from PLN 94.5 billion to\u00a0PLN 107 billion<\/strong>. In\u00a0the buildings segment, sold production increased by\u00a03.9%, while in\u00a0the infrastructure area the increase was as\u00a0much as\u00a023.5%.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" style=\"margin:10px auto\" src=\"https:\/\/d2xhqqdaxyaju6.cloudfront.net\/file\/attachment-s\/2571048\/71\/s-800-x.png\" alt=\"Q3 2023 2\" width=\"800\" height=\"488\"><\/p>\n<p style=\"text-align:justify\"><strong>The sales of the construction segment of the Budimex Group for the first three quarters \u00a0of 2023 amounted to\u00a0PLN 6,346 million (+9.2% y\/y), while recording an increase in\u00a0both operating profitability (from 6.1% to\u00a06.7%) and gross profitability (from 6.9% to\u00a08.4%).<\/strong><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" style=\"margin:10px auto\" src=\"https:\/\/d2xhqqdaxyaju6.cloudfront.net\/file\/attachment-s\/2571050\/3b\/s-800-x.png\" alt=\"Q3 2023 3\" width=\"800\" height=\"447\"><\/p>\n<p style=\"text-align:justify\">The scale of sales revenues generated in\u00a0the first nine months of 2023 in\u00a0the construction segment was noticeably higher than in\u00a0the corresponding period of the previous year. The high level of the order book and its diversification, combined with favorable weather conditions, allowed the company to\u00a0increase revenues by\u00a0over 9.2%. We\u00a0recorded an increase in\u00a0sales in\u00a0most areas of construction activity on\u00a0the domestic market. The sales of the Budimex Group were also supported by\u00a0the recognition of the first significant revenues from operations on\u00a0foreign markets.<\/p>\n<p style=\"text-align:justify\">The operating profitability of the construction segment in\u00a0the period under discussion amounted to\u00a06.7% and was higher by\u00a00.6 percentage points compared\u00a0to\u00a0the same period of the previous year.<\/p>\n<p style=\"text-align:justify\">As\u00a0a\u00a0result of the slowdown observed in\u00a0residential construction, the availability of subcontractors in\u00a0the area of cubature construction has improved, which often translated into the prices they offer. At\u00a0the same time, the effects of increases in\u00a0the prices of construction materials and labour, observed from the moment of submitting the bid to\u00a0the commencement of construction works (in\u00a0the case of contracts carried out in\u00a0the \u201cDesign and Build\u201d formula, it is usually over a\u00a0year), have been partially absorbed by\u00a0the introduction of indexation mechanisms on\u00a0construction contracts carried out for public contracting authorities.<\/p>\n<p style=\"text-align:justify\">The gross margin of the construction segment in\u00a0the period in\u00a0question was 8.4% and was 1.5 percentage points higher than in\u00a0the corresponding period of 2022, when it amounted to\u00a06.9%. In\u00a0the first three quarters of 2023, in\u00a0addition to\u00a0an increase in\u00a0the profitability of contracts at\u00a0the operating level, the profitability at\u00a0the level of gross profit was supported by\u00a0a\u00a0positive result on\u00a0financing activities due\u00a0 to\u00a0interest on\u00a0deposits.\u00a0<\/p>\n<p style=\"text-align:justify\"><strong>New contracts and order book<\/strong><\/p>\n<p style=\"text-align:justify\">During the first three quarters of 2023, we\u00a0obtained contracts worth over PLN 4.5 billion. These include such investments as: the Zabierz\u00f3w bypass along DK 79, the railway line 104 Chab\u00f3wka \u2013 Rabka Zaryte, or\u00a0the expansion of the Opera Nova in\u00a0Bydgoszcz. In\u00a0addition, on\u00a0October 13, 2023, a\u00a0significant railway contract was signed for the implementation of comprehensive construction works covering rail and road infrastructure on\u00a0the Tychy \u2013 Vistula Bridge section, worth over PLN 900 million.<\/p>\n<p style=\"text-align:justify\">The Budimex Group\u2019s order book at\u00a0the end of September 2023 exceeded PLN 12 billion, which secures the work front for the next two years. The intensification of work on\u00a0acquiring new projects in\u00a0Poland and abroad has resulted in\u00a0the fact that the value of projects awaiting signing, and those where the offer of Budimex or\u00a0Group companies has been rated the highest, or\u00a0occupies the best bargaining position, is currently over PLN 12 billion, of which over PLN 8 billion was attributable to\u00a0contracts on\u00a0foreign markets \u2013 the Czech Republic,\u00a0  Slovak and Latvian. On\u00a031 August 2023, Budimex SA received information about the selection of the bid of the consortium of Eiffage Genie Civil, Rizzani de\u00a0Eccher S.p.A. and Budimex S.A. as\u00a0the most advantageous in\u00a0the tender procedure for the construction of the main railway line \u201cRail Baltica\u201d in\u00a0Latvia. The budget of the entire contract is nearly EUR 3.7 billion net, with the estimated value of the first stage of works being approx. EUR 230 million net. Budimex SA holds a\u00a030% stake in\u00a0the above-mentioned consortium. In\u00a0the coming quarters, this should translate into maintaining a\u00a0high and geographically diversified order portfolio.<\/p>\n<p style=\"text-align:justify\"><strong>The Budimex Group ended the third quarter of 2023 with a\u00a0high net cash position, exceeding PLN 2.8 billion. <\/strong>In\u00a0June, for the 15th year in\u00a0a\u00a0row, we\u00a0paid a\u00a0dividend of PLN 459 million, which is PLN\u00a017.99 per share. The stable margins achieved on\u00a0construction contracts in\u00a0recent quarters, combined with effective management of working capital and meticulous control of fixed costs, allow the Budimex Group to\u00a0maintain a\u00a0safe level of cash that may be\u00a0invested in\u00a0new areas of activity in\u00a0the future.<\/p>\n<p style=\"text-align:justify\">We\u00a0estimate that the decisions on\u00a0segment diversification as\u00a0well as\u00a0expansion into foreign markets are the right directions, currently over 60% of contracts in\u00a0the waiting room are orders on\u00a0foreign markets. Our company has the appropriate potential and\u00a0 experience to\u00a0carry out complex contracts in\u00a0Poland and abroad \u2013 this is an opportunity for us to\u00a0strengthen the position of the Budimex Group as\u00a0a\u00a0leading construction company in\u00a0 Central and Eastern Europe.<\/p>\n<p style=\"text-align:justify\"><strong>Energy and electromobility<\/strong><\/p>\n<p style=\"text-align:justify\">We\u00a0continue our development direction in\u00a0the area of renewable energy investments. In\u00a0September, our first wind farm started producing green energy. In\u00a0 the newly established BXF Energia company, we\u00a0plan to\u00a0build\u00a0 a\u00a0portfolio of RES projects with a\u00a0capacity of approx. 500 MW from wind and solar. We\u00a0are currently analyzing projects at\u00a0various stages of advancement with a\u00a0capacity of approx. 800 MW.<\/p>\n<p style=\"text-align:justify\">We\u00a0are gradually building our potential in\u00a0the area of electromobility. We\u00a0are involved in\u00a0the\u00a0 development of the national charging infrastructure for electric vehicles. By\u00a0the end of the year, Budimex Mobility will have 160 publicly available chargers, and internal plans assume 230 chargers by\u00a0the end of 2024<span style=\"text-decoration:line-through\">. <\/span> <\/p>\n<p style=\"text-align:justify\"><strong>After three quarters, the FBSerwis Group recorded an increase in\u00a0sales revenues by\u00a0PLN 93 million, while maintaining good profitability. Gross profit amounted to\u00a0PLN 64.5 million compared to\u00a0PLN 65 million in\u00a02022.<\/strong><\/p>\n<p><strong><img loading=\"lazy\" decoding=\"async\" style=\"margin:10px auto\" src=\"https:\/\/d2xhqqdaxyaju6.cloudfront.net\/file\/attachment-s\/2571054\/52\/s-800-x.png\" alt=\"Q3 2023 4\" width=\"800\" height=\"336\"><\/strong><\/p>\n<p style=\"text-align:justify\">The revenues of the FBSerwis Group, which is a\u00a0key asset in\u00a0the services segment (the results of the service part also include the activities of companies from the RES area and Budimex Parking Wroc\u0142aw), amounted to\u00a0PLN 665.5 million and were 16.2% higher than in\u00a0the corresponding period of the previous year. The increase in\u00a0sales volume was achieved in\u00a0each of the business segments and was higher than our internal plans.<\/p>\n<p style=\"text-align:justify\"><strong>Social activities and awards<\/strong><\/p>\n<p style=\"text-align:justify\">We\u00a0have created a\u00a0new educational room of the Technical School of Power Engineering in\u00a0Be\u0142chat\u00f3w. This is an award in\u00a0the competition for the best CSR project as\u00a0part of the \u201cPractice that will stay with\u00a0you\u201d campaign, which is an initiative of Budimex carried out in\u00a0cooperation with\u00a0the Zwolnieni z\u00a0Teorii Foundation. The winners \u2013 a\u00a0group of students from the Technical School of\u00a0Power Engineering in\u00a0Be\u0142chat\u00f3w \u2013 decided to\u00a0use the construction skills acquired at\u00a0school\u00a0and\u00a0renovated an apartment for a\u00a0family from\u00a0Ukraine. We\u00a0supported the Second Breakfast campaign addressed to\u00a0first-graders of primary schools in\u00a0E\u0142k.<\/p>\n<p style=\"text-align:justify\">More than 20 housing communities and cooperatives joined the second edition of the Przystanek Ziele\u0144 program in\u00a0Warsaw. Budimex continues the apprenticeship programme for students of construction technicians. This year\u2019s edition was attended by\u00a040 apprentices, studying in\u00a0construction classes and related specializations. The \u201cLearn and build practice\u201d program aims to\u00a0develop the skills of young construction adepts, as\u00a0well as\u00a0to\u00a0support the education of future specialists.<\/p>\n<p style=\"text-align:justify\">Our construction sites have won prestigious awards. The modernization of the Planetarium in\u00a0Chorz\u00f3w was awarded the title of Modernization of the Year 2023 in\u00a0the 27. edition of the Modernization of the Year \u2013 Construction of the 21st Century competition. The contract carried out by\u00a0Budimex in\u00a02019-2022 was rated the highest by\u00a0the jury in\u00a0the category of public buildings. Over 500 investments were submitted to\u00a0the competition. Only the best 20 of them were awarded. Budimex returns with 2 awards from this year\u2019s edition of the \u201cConstruction of the Year\u201d competition, organised by\u00a0the Polish Association of Construction Engineers and Technicians. The investments awarded with Construction Oscars include the construction of the \u0141agiewnicka Route in\u00a0 Krakow and the modernization of the Institute of Thermal Technology of the Warsaw University of Technology in\u00a0 Warsaw.<\/p>\n<p style=\"text-align:justify\"><strong>Market outlook<\/strong><\/p>\n<p style=\"text-align:justify\">The current order book of the Budimex Group fully secures the work front for the coming quarters. Bearing in\u00a0mind the record level of projects awaiting signing, we\u00a0are confident about the level of utilization of our production capacity in\u00a0the next 2-3 years.<\/p>\n<p style=\"text-align:justify\">The total value of projects awaiting signing is over PLN 12 billion \u2013 with more than half of this value related to\u00a0contracts in\u00a0the railway area, including the order for the construction of the main Rail Baltica line in\u00a0Latvia. We\u00a0estimate that the decisions on\u00a0segment diversification as\u00a0well as\u00a0expansion into foreign markets are the right directions, currently over 60% of contracts in\u00a0the waiting room are orders on\u00a0foreign markets. We\u00a0have the right equipment, people, capital and experience to\u00a0carry out such complex contracts in\u00a0Poland and abroad \u2013 this is an opportunity for us to\u00a0strengthen the position of the Budimex Group as\u00a0a\u00a0leading construction company in\u00a0Central and Eastern Europe.<\/p>\n<p style=\"text-align:justify\">On\u00a0the local market, we\u00a0are constantly observing an aggressive fight for orders in\u00a0the road, rail and cubature areas. On\u00a0the one hand, this is a\u00a0consequence of the lower supply of tenders, on\u00a0the other hand, we\u00a0are observing a\u00a0tightening of the level of competition from foreign entities. We\u00a0expect that over the next few quarters, the aggressive pricing policy of competitors will result in\u00a0further pressure on\u00a0margins in\u00a0the industry. When taking part in\u00a0tenders outside Poland, we\u00a0usually have to\u00a0go\u00a0through a\u00a0certification process \u2013 we\u00a0would like to\u00a0feel that construction companies from abroad are verified and certified in\u00a0Poland in\u00a0the same way as\u00a0Budimex in\u00a0neighbouring countries.<\/p><\/div>\n                            <\/div>\n                                                                                                    <div class=\"col-24 col-lg-7 offset-lg-1\">\n                    <div class=\"text-block__booklet\">\n                        \n<div class=\"card-booklet\">\n    <div class=\"card-booklet__image\">\n                    <img decoding=\"async\" src=\"https:\/\/bdm-stg.mda.pl\/app\/themes\/main\/dist\/img\/booklet_image.png\" alt=\"Pobierz plik - obrazek\">\n            <\/div>\n                                    <\/div>                    <\/div>\n                <\/div>\n                                                        <\/div>\n    <\/div>\n<\/section>\n    <section id=\"block_70fd5b8685b6ecd395017e986777a2cf\" class=\"gallery-section section-margin-120\" data-per-page=\"8\" data-per-row=\"4\" data-type=\"zdjecia\">\n        <div class=\"container\">\n            <div class=\"row\">\n                                    <div class=\"col-24\">\n                        <h2 class=\"gallery-section__title under-h2\">Gallery<\/h2>\n                    <\/div>\n                            <\/div>\n            <div class=\"row\">\n                <div class=\"col-24\">\n                                                                        <div class=\"gallery-section__grid gallery-section__grid--4\">\n                                \n                        <div class=\"gallery-section__image gallery-section__image--single\">\n                <a href=\"\">\n                                                                            <\/a>\n                            <\/div>\n            \n                            <\/div>\n                                                                                        <\/div>\n            <\/div>\n        <\/div>\n    <\/section>\n","protected":false},"excerpt":{"rendered":"<p>We recorded an increase in the Group&#8217;s sales revenues, both in the construction and service parts. We also improved profitability. After three quarters of 2023, the Budimex Group generated an operating profit of PLN 482 million. &#8230;<\/p>\n","protected":false},"featured_media":145500,"parent":0,"template":"","press_type":[537,772,790],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Commentary by Artur Popko, President of the Management Board of Budimex SA, on the financial data of the Budimex Group for the first three quarters of 2023 - Budimex<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Commentary by Artur Popko, President of the Management Board of Budimex SA, on the financial data of the Budimex Group for the first three quarters of 2023 - Budimex\" \/>\n<meta property=\"og:description\" content=\"We recorded an increase in the Group&#039;s sales revenues, both in the construction and service parts. We also improved profitability. 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