Earnings
HOCHTIEF generated
sales of EUR 3.8 billion in the first
quarter of 2008, up 3.2 percent on the same period in
2007 (EUR 3.68 billion). Redoubled efforts to open up new
growth areas in the previous year and the target-driven
expansion of our capabilities are thus beginning to show
results. At the HOCHTIEF Americas division, entry into the
US transport infrastructure market in late 2007 supplemented
the increase in sales due to organic growth at Turner.
HOCHTIEF boosted sales on the important US market by
a substantial 18.3 percent compared with the prior-year
quarter, from EUR 1.46 billion to EUR 1.73 billion. The fall
in the US dollar means that this increase is artificially reduced
on translation into euros, the Group currency. In local
currency, Turner raised sales by some 25 percent to USD
2.35 billion (from USD 1.88 billion in the first quarter of
2007). The HOCHTIEF Asia Pacific division, on the other
hand, reported a decrease in sales compared with the prioryear
period, from EUR 1.49 billion to EUR 1.24 billion. It
should be borne in mind in this context that Leighton benefited
especially in early 2007 from the market trend in infrastructure
projects as well as from strong demand for
natural resources in contract mining services. Also, a
larger proportion of business in the period under review
was conducted in joint ventures. Sales in the remaining
divisions
continued to grow. The HOCHTIEF Europe division
benefited from the healthy trend in its Eastern European
business with first-quarter sales up from EUR 456.3
million to EUR 494.1 million, while sales at HOCHTIEF Services
climbed due to the expanded range of capabilities to
no less than EUR 160.6 million (up from EUR 119.3 million).
All operating divisions improved earnings in the first quarter
of 2008. Operating earnings (EBITA) grew by 83.4 percent
to EUR 131.9 million (up from EUR 71.9 million). Our
international business continued its outstanding growth
trend. The HOCHTIEF Asia Pacific division generated
operating
earnings in the three-digit millions in the first three
months of 2008 alone (EUR 104.2 million, compared with
EUR 73.2 million in the same quarter of 2007). Earnings at
the HOCHTIEF Europe division have improved substantially
from the situation a year earlier. The strategic realignment
of the German building construction business has begun
to show results, with the operating loss more than halved
from EUR 27.5 million to EUR 13.5 million.
Net income from participating interests grew exceptionally
strongly to EUR 96.1 million, an increase of EUR
60.1 million on the comparable prior-year period (EUR 36
million). Leighton secured particularly striking performance
from its business portfolio. The HOCHTIEF Asia Pacific division
increased net income from participating interests from
EUR 12.6 million in the prior-year period to EUR 62.8 million
in the first quarter of 2008. A main factor here was higher
earnings from joint ventures used to carry out major contracts.
The airports business continued to contribute substantially
to earnings, boosting net income from participating
interests by some EUR 23 million despite the special
dividend from Sydney Airport in 2007. This was made possible
by larger earnings contributions from Athens, Hamburg
and Düsseldorf airports. The stake in aurelis Real Estate
acquired in the previous year likewise impacted positively
on net income from participating interests in the period
under review.
Net investment and interest income deteriorated from
minus EUR 0.1 million in the prior-year period to minus
EUR 17.8 million in the first quarter of 2008. Borrowing taken
out by HOCHTIEF to finance the Group's ongoing expansion
resulted in higher finance costs.
Profit before taxes improved from the prior-year period
(EUR 65.9 million) by 56.8 percent to EUR 103.3 million.
In line with the higher earnings, income taxes rose to
EUR 34.3 million (compared with EUR 23.8 million in the
prior-year period). Within this figure, deferred taxes remained
on a par with the prior-year quarter, and most of
the increase was in current income tax, chiefly at Leighton
and Turner.
The effective tax rate remained low, at 33.2 percent. There
was a further 2.9 percentage point decrease from the firstquarter
2007 level of 36.1 percent.
Profit after taxes showed a marked increase carried by
the positive trend in our operating divisions, climbing by
63.9 percent from EUR 42.1 million in the prior-year period
to EUR 69 million in the first quarter of 2008.
Consolidated net profit rose even more strongly to EUR
32.1 million, more than three times the EUR 9.6 million figure
for the prior-year period. The minority interest grew by
