Eiffage reports steady contracting growth, buoyed by European markets

An Eiffage building in France. Image: Adobe Stock

Growth was strongest in Europe outside France, where revenues jumped 17.4%.

The firm’s order book reached €29.5 billion ($34.3 billion) at 30 June, 4% higher than a year earlier and equal to 17 months of activity. Operating profit on ordinary activities rose slightly to €1 billion ($1.2 billion), providing a margin of 8.4%.

Contracting revenue advanced 8.4% to €10 billion ($11.6 billion), with international markets accounting for more than 42% of the total. 

The construction division delivered stable revenues of €1.94 billion, while property development fell 24% amid a continuing housing slowdown across Europe.

Infrastructure revenue increased 8.2% to €4.3 billion, with Eiffage Génie Civil up sharply but Eiffage Métal declining in France even as it expanded abroad. Energy systems rose 13.2% to €3.8 billion, helped by acquisitions in Germany and Spain. Contracting margins improved overall to 2.4%, lifting divisional profit by 16% to €241 million.

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In concessions, revenue rose 3.1% to €1.9 billion ($2.3 billion).

Net income attributable to the group dropped nearly 20% to €308 million ($358 million), weighed down by a one-off corporation tax contribution in France. Eiffage said, at a constant tax rate, net profit would have risen. Free cash flow was negative €91 million ($106 million), reflecting seasonal swings in working capital and higher investment. Net debt fell by about €700 million ($814 million) over the year to €9.9 billion ($11.5 billion).

The company highlighted several strategic developments in the half year, including the acquisition of Netherlands-based HSM Offshore Energy, a player in the European wind power markets, and new contract wins such as the design-build of Frontex headquarters in Warsaw, Poland.

Eiffage confirmed its full-year outlook, projecting higher revenue and operating profit in contracting, supported by profitability gains at its energy systems unit. Concessions are also expected to deliver slight growth. However, group net income will remain constrained by the exceptional tax charge, Eiffage said.

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