Bouygues: First half net profit down but operating profit improved
The operator reported a 5% year-on-year revenue increase in the first half of fiscal 2022.
Bouygues, the French construction giant diversified into telecoms and media, saw its first-half net income melt year-on-year, buoyed by the sale of Alstom and data centers. However, the group improved its ongoing operating result. Bouygues, which posted a six-month sales increase of 6% to 18.5 billion euros, reported exceptional expenses in the first half. These are related to the two major structural operations in which it is involved: the acquisition of Equans from the Engie group, the largest acquisition ever made by the group created in 1952, and the merger between TF1 and M6.
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On July 19, Bouygues received the green light from the European Commission to acquire Equans for €7.1 billion, subject to the sale of a subsidiary in Belgium, Colas Rail Belgium, which risked taking a dominant position in the flat country. On the same day, the British competition authority CMA in Great Britain considered the process to be problematic. With good reason, according to the CMA, this would likely lead to a weakening of competition in an ongoing tender for a high-speed line under construction. Bouygues therefore submitted proposed remedies on July 26.which the CMA should decide very soon“.
A well-filled order book
The completion of the acquisition of Equans, which brings together technical services from energy management in buildings to fire protection, including ventilation, air conditioning, heating and digital technology, announced on May 12, is expected in the second half of 2022. For the full year 2022, the group expects with a “further increase in sales and current operating result» and the validation of the greenhouse gas emission reduction targets of its construction subsidiary Colas by the Science Based Target Initiative (SBTI).
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In the first half of the year, the net profit was divided by three to 147 million euros. However, the current operating result improved compared to the first half year by 21 million euros to 492 million euros. At the end of June 2022, the order book for construction and services activities (Bouygues Construction, Bouygues Immobilier, Colas) increased by 6% to 35.1 billion euros, driven by international business, despite a 5% decrease compared to the construction division, but above all 12 % of Bouygues Immobilier’s order book hurt by weakness in the commercial real estate sector. Colas’ backlog grew 25% year over year, thanks to a major order for the Cairo Metro in Egypt won in the first quarter, but also thanks to road activity in France and the United States.