Property drags Bam down

Bam's net profit for the first half of the year was € 41,9 million, a -68% fall on the same period last year. The major cause of this was a € 36,8 million loss by the company's property development business, although all its divisions reported some reduction in profitability.

Revenues across the company fell -4,1% to € 4,06 billion for the half year. Although there was growth in the civil engineering and mechanical and electrical engineering businesses, all of Bam's other divisions saw volumes fall. Again, the real estate business stood out, with a -23,2% drop in revenues to € 441 million.

But despite the falls Bam had a healthy, albeit reduced, order book at the end of June. Work in hand totalled € 12,4 billion - equivalent to about 18 months of activity at current levels. However, this was down -13,3% from the € 14,3 billion order book it had a year ago.

Commenting on the current environment, a company statement said, "Volumes are shrinking, competition is intensifying and there is substantial pressure on pricing in almost all markets. Despite this economic backdrop, many BAM operating companies performed strongly in the first half of the year."