Half year results 2001

The Group’s revenues rose to €2,582 million. This represents an increase of 8.7% on the continued activities, with 1.5% of the increase accounted for by exchange rate movements. The order book, at €6.4 billion [€5.9 billion] has also developed well, and represents an excellent volume of good-quality work.

The capital ratio has improved from 19.9% as at year-end 2000 to 22.7% as at 30 June 2001. The ratio is expected to exceed the target level of 25% by year-end 2001.

HBG divides its activities into four sectors: Construction and property, Civil engineering, Dredging and Consultancy and engineering.

Construction and property

The Group’s Construction and property division achieved revenues of €1,173 million [+3.4%] in the first half of 2001, or 45% [46%] of the total revenues. The operating result [EBIT] for the first half of 2001 amounted to €12 million [€16 million]. HBG returned a negative operating result of €5 million on these activities in 2000. A comparable result to that for the first six months is expected in the second half of 2001. In the Netherlands, the results were markedly better. The trend in results in the United Kingdom is also good. And the German construction activities are expected to achieve break-even this year. At €2.5 billion [year-end 2000: €2.5 billion], the order book is at a good level.

Civil engineering

Civil engineering division revenues increased compared with the first half of 2000 to €1,156 million [+13.6%]. This increase was mainly accounted for by the activities in the United Kingdom and Ireland. The share of total revenues was 45% [42%]. The operating result [EBIT] for the first six months amounted to €26 million [€15 million]. The sharp improvement in the first half is expected to continue in the remainder of the year. The restructuring of the German activities is progressing satisfactorily, and a small profit contribution is expected for 2001. The result in the United States was a profit, but not yet of the desired level. The order book as at the end of June 2001 stood at €3.2 billion [year-end 2000: €2.7 billion]. This increase is largely accounted for by the major infrastructure projects in the Netherlands and the United Kingdom.

Dredging

The world dredging market remains as buoyant as ever. The dredging company HAM’s revenues were up by 13% compared with the first half of 2000, at €212 million. The operating result [EBIT] amounted to €17 million, which is on a par with last year. Compared with 2000, HAM – in line with previous forecasts – is expecting a lower, but still very good, operating result. The order book remained at the high level of €0.7 billion.

On 26 June 2001, HBG signed an agreement with Ballast Nedam nv on the merger of the two group’s dredging activities to form Ballast HAM Dredging bv. A temporary injunction imposed by the Enterprise Section of the Court of Appeal at Amsterdam means that the implementation of the merger has been delayed. The impact of the creation of Ballast HAM Dredging has accordingly not been reflected in this half-year report.

Consultancy and engineering

Tebodin’s performance was in line with expectations, with revenues of €65 million [+3.2%]. The operating result [EBIT], at €4 million, was on a par with last year. Tebodin is forecasting a similar result for the second half of the year. The order book as at mid-2001 stood at €72 million [year-end 2000: €65 million].

Acquisitions and disposals

During the first half of 2001, HBG sold its interest of 29 per cent in NEM bv – the environmental and energy technology specialist – to L. & C. Steinmüller with a book profit. The extraordinary result after tax amounted to a net figure of €14 million.

Wayss & Freytag Ingenieurbau has disposed of its subsidiary Mansfeld Würzelbau GmbH. This company, with a workforce of approximately 60, operated in the eastern part of Germany.

Tebodin has taken over Deventer-based Cebeco Consulting Engineers bv [CCE]. CCE has a staff of more than forty and possesses considerable specialist expertise and experience relating to the agricultural industry. Turnover amounts to around €4 million. CCE’s specialist expertise represents a valuable addition to Tebodin’s package of activities.

HBG Ascon has taken over the Irish construction company, Thomas Logan & Sons Ltd, which specialises in earthmoving. Logan has a turnover of around €12 million and employs approximately 75 people. Logan has an extensive range of construction plant and equipment with an experienced workforce, both factors of considerable importance to HBG Ascon in its efforts to continue strengthening market position.

Full Potential Programme

The three restructuring programmes designed to bring about improvements in operations ['commercial and executional excellence'], procurement activities ['purchasing'] and overheads – together referred to as the Full Potential Programme – are on target. The FPP is intended to produce an improvement in the operating result, yielding an EBIT of at least €200 million in 2003.

Further information:

Arno C. Pronk, HBG Public Relations, +31 [0]70 3722121.