Data centres and energy transition projects drive record new orders for Hochtief

The company’s new orders increased 27% year on year as its order backlog reached €55.3 billion (US$59.8 billion), up €3.9 billion (US$4.2 billion) compared to December 2022.

Infrastructure giant Hochtief owns major subsidiaries in North America, Europe and Australia, including Turner and Flatiron in the USA and Australia’s Cimic.

Turner alone won US$2.8 billion worth of new data centre projects in the US during 2023, while Cimic won data centres in Hong Kong, the Philippines and Malaysia worth A$400 million (US$261.7 million). Turner also secured US$2.5 billion of new orders in EV battery gigafactories in the US in 2023.

As a group, Hochtief unveiled a 10% increase in sales on a foreign exchange-adjusted basis to €27.8 billion (US$30.1 billion) in 2023.

Meanwhile, its nominal net profit was €523 million (US$565.6 million) last year, compared with €482 million (US$521.3 million) the year before, an increase of 8% (or 14% taking into account foreign exchange adjustments).

New orders in Hochtief’s home market of Germany almost tripled, rising to €2.9 billion (US$3.1 billion), as it sidestepped the turmoil facing Germany’s residential market and focused on infrastructure projects.

Hochtief claimed that 85% of its order book is now made up of “lower-risk” contracts, compared with around 65% six years ago, as it continues to de-risk the new business it takes on.

It characterises lower-risk projects as deals other than lump-sum design and build projects, preferring to work instead on a collaborative basis or via construction management contracts.

Hochtief CEO Juan Santamaría said, “A key element of our corporate strategy is to further develop Hochtief’s presence in rapidly expanding high-tech markets. By harnessing our strong existing infrastructure skillset and local presence in key developed markets as well as the resultant potential synergies, we can maximize these growth opportunities across the group. The strong growth in new orders achieved in 2023 shows the strategy is delivering”.

Looking forward to 2024, the company forecast net operational profit in the range of €560 million to €610 million (US$605.6 million - US$659.7 million).