Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Construction comeback sets Vinci on road to recovery

Published 07/30/2021, 04:33 AM
Updated 07/30/2021, 04:36 AM
© Reuters. FILE PHOTO: Vinci Chairman and Chief Executive Officer Xavier Huillard visits a construction site at the financial and business district of La Defense, in Courbevoie near Paris, January 16, 2019. REUTERS/Benoit Tessier

© Reuters. FILE PHOTO: Vinci Chairman and Chief Executive Officer Xavier Huillard visits a construction site at the financial and business district of La Defense, in Courbevoie near Paris, January 16, 2019. REUTERS/Benoit Tessier

By Sarah Morland

(Reuters) - France's Vinci raised its 2021 outlook on Friday, saying sales and profit margins at its energy and construction businesses should exceed pre-pandemic levels after a strong start to the year.

The group, which also operates motorways and airports, had warned in April that its 2021 earnings would not recover to the heights of 2019, though contracting revenue may come "very close".

The company saw a ramp-up in its public works and civil engineering projects, benefiting from works linked to a 35 billion euro ($41.6 billion) extension of the Paris metro.

"Business levels and earnings at Vinci Energies and Vinci Construction were outstanding, exceeding levels seen in 2019," said Chief Executive Xavier Huillard, stipulating that at a global level earnings would not recover this year, weighed down by low traffic in its airports and concessions businesses.

Despite returning to profit, Vinci's half-year net result reached only half that of 2019, following a year of COVID-19 restrictions across Europe that disrupted construction and stunted traffic.

Huillard added that a gradual easing of travel curbs in May had led to a rapid recovery on Vinci's motorways.

Vinci's airports arm, however, booked a core loss of 250 million euros over the period as passenger numbers remained low, with June figures down 73% compared with 2019.

However, Vinci Airports President Nicolas Notebaert told reporters that this week represented the "first shudder" of recovery at Gatwick airport near London as restrictions ease.

England will allow fully vaccinated visitors from the European Union and United States to arrive without needing to quarantine from next week, although travellers will still need to be tested.

Vinci's first-half core earnings beat analysts' forecasts but remained well below 2019, while sales jumped 22% and surpassed their pre-pandemic levels.

© Reuters. FILE PHOTO: Vinci Chairman and Chief Executive Officer Xavier Huillard visits a construction site at the financial and business district of La Defense, in Courbevoie near Paris, January 16, 2019. REUTERS/Benoit Tessier

The group also approved an interim dividend of 0.65 euros per share.

($1 = 0.8405 euros)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.