Structure of sales revenue of the Budimex Group
Sales of the construction segment
In 2015, the construction market (measured by the value of sales of the construction and assembly production) increased by 2.3% in comparison to 2014. The building construction sector recognised dynamics at the level of 3.0%, while the infrastructural construction sector increased by 1.7%.
In the discussed period, the value of sales in the construction segment of the Budimex Group was by 4.7% higher when compared with 2014. Sales in the building construction sector increased by 19.8%, while sales in the infrastructural construction sector fell by 6.8% as compared with 2014.
The share of the infrastructural construction segment in the total revenues from construction and assembly services
of the Group dropped from 56.8% in 2014 to 50.6% in 2015. A good situation in the housing market was reflected by the value of contracts won in this sector and, as a consequence, the share of residential construction segment in the structure of sales of the construction segment increased from 6.1% in 2014 to 10.1% in 2015.
The table below presents the sales structure by individual sectors of the construction market:
| Type of construction | Sales value | |||
|---|---|---|---|---|
| 2015 | 2014 | |||
| PLN million | % | PLN million | % | |
| Civil engineering (infrastructure) | 2 497 | 50,6% | 2 680 | 56,8% |
| Buildings, of which: | 2 440 | 49,4% | 2 037 | 43,2% |
| - non-residential buildings | 1 939 | 39,3% | 1 748 | 37,1% |
| - residential buildings | 501 | 10,1% | 289 | 6,1% |
| Total sales of construction and assembly services | 4 937 | 100% | 4 717 | 100% |
Development activities
In 2015, sales of the development business amounted to PLN 292,599 thousand, recording an increase of 16.8% as compared with the previous year. Sales revenues on development activities are recognised upon transfer of the ownership title to a flat/premises to the buyer after the technical acceptance report has been signed for the entire building. Notary sales of flats depends on the dates of completion of the construction projects and delivery of finished flats to the customers. It is not a seasonal phenomenon and it cannot be compared on a year-over-year basis.
As a result of the factors specified in section 1.1 (general characteristics of the market), 2015 saw a significant revival and dynamic growth in demand for new flats within the entire development market. This was directly reflected in the unprecedented level of pre-sales of flats. Throughout 2015, the net pre-sales of new flats amounted to 1,918 flats, as compared with 1,685 flats in the preceding year.
To meet the customers’ requirements and ensure the stability of sales revenue in the following years, in 2015, the construction of over two thousand new flats was commenced within twelve new development projects located in Warsaw, Kraków and Poznań. As of 31 December 2015, approx. four thousand flats were under construction. In 2015, the Group continued the process of diversifying its land bank by purchasing new plots of land in Warsaw and Gdańsk. Construction of over 6.2 thousand new flats is possible on the currently owned land.
Major construction contracts concluded by the Budimex Group companies in 2015:
| Contract date | Contract value allocated to the Budimex Group | Customer | Type of construction |
|---|---|---|---|
| 2015-10-09 | 1,281,621 | General Directorate for National Roads and Motorways Branch in Gdańsk |
Construction of the S7 road: Gdańsk (A1) — Elbląg (S22) section Koszwały (national road No 7, in Koszwały) — Elbląg (with the Kazimierzowo junction); Task 2: Nowy Dwór Gdański–Kazimierzowo |
| 2015-06-15 | 1,071,708 | General Directorate for National Roads and Motorways Branch in Olsztyn |
Construction of the S7 express road at the Miłomłyn–Olsztynek section, the Ostróda Północ–Ostróda Południe subsection along the S7 road, and construction of the Ostróda ring road along the national road No 16 (subsection “B”) |
| 2015-02-27 | 638,664 | General Directorate for National Roads and Motorways Branch in Wrocław |
Design and construction of the S3 express road between Nowa Sól and Legnica (A4), task V from the Lubin Południe junction (excl. the junction) to the Legnica II junction (A4) |
| 2015-09-29 | 279,602 | General Directorate for National Roads and Motorways Branch in Szczecin |
Design and construction of the S6 express road at the section of Goleniów–Nowogard (S3, junction “Goleniów Północ” /incl. the junction/ the start of the ring road for the city of Nowogard) |
| 2015-09-22 | 254,980 | General Directorate for National Roads and Motorways Branch in Lublin |
Design and construction of the S17 Garwolin–Kurów express road at the section of Garwolin (end of the ring road) to the border of Mazowieckie and Lubelskie provinces, divided into two parts: Part No 2: at the section of Gończyce (end of the ring road) to the border of Mazowieckie and Lubelskie provinces, from approx. km 62+200 to approx. km 75+212 |
| 2015-09-29 | 243,459 | General Directorate for National Roads and Motorways Branch in Białystok |
Design and construction of a ring road for the city of Suwałki, along the S61 express road — Section A and Section B |
| 2015-09-22 | 234,616 | General Directorate for National Roads and Motorways Branch in Lublin |
Design and construction of the S17 Garwolin–Kurów express road at the section of Garwolin (end of the ring road) to the border of Mazowieckie and Lubelskie provinces, divided into two parts: Part No 1: at the section of Garwolin (end of the ring road) to Gończyce (end of the ring road), from approx. km 49+973 to approx. km 62+200 |
| 2015-10-05 | 206,500 | General Directorate for National Roads and Motorways Branch in Szczecin |
Design and construction of the S6 express road at the section between the end of the ring road for the city of Płoty and the “Kiełpino” junction (incl. the junction) |
| 2015-09-16 | 190,672 | PKP Polskie Linie Kolejowe SA |
Performance of construction works within the project under Operational Programme Infrastructure and Environment 7.1–55 “Construction of the Kraków Zabłocie–Kraków Krzemionki railway connection” |
| 2015-10-20 | 157,962 | General Directorate for National Roads and Motorways Branch in Zielona Góra |
Construction of the second carriageway of the S3 express road at the section Sulechów–Nowa Sól: the second section from km 286+043 to km 299+350 |
| 2015-02-24 | 96,477 | Mazowiecki Szpital Wojewódzki Drewnica Sp. z o.o. | Construction of Mazowiecki Szpital Wojewódzki Drewnica |
| 2015-06-30 | 68,690 | Poznańskie Inwestycje Miejskie Sp. z o.o. acting for and on behalf of the City of Poznań and Aquanet SA |
Construction and expansion of roads for the Mixed Municipal Waste Residues Fraction Incineration System (Instalacja Termicznego Przekształcania Frakcji Resztkowej Zmieszanych Odpadów Komunalnych, ITPOK) |
| 2015-12-09 | 64,500 | Bouygues Immobilier Polska Sp. z o.o. |
Construction of the residential and commercial complex “ESPACE” (buildings C and D) in Warsaw Wilanów, at the junction of Oś Królewska and Al. Rzeczypospolitej streets |
| 2015-07-06 | 61,000 | mLocum SA | Construction of a housing estate at ul. Łąkowa 23/25 in Łódź |
| 2015-09-10 | 56,493 | Eqlibrium Sp. z o.o. | Construction of the office facility “Eqlibrium” together with the external infrastructure at Jana Kazimierza Street, junction with Jana Ordona Street in Warsaw |
| 2015-10-07 | 53,677 | General Directorate for National Roads and Motorways Branch in Opole |
Construction of a ring road for the city of Kępno along the S11 express road — Section I |
| 2015-06-01 | 53,423 | Dune B Sp. z o.o. | Construction of the Dune B residential building with services and a car park with the necessary technical infrastructure in Mielno at ul. Pionierów 18 |
| 2015-05-29 | 53,222 | Spx Flow Technology Poland Sp. z o.o. |
Construction of a production hall in Bydgoszcz |
| 2015-09-24 | 46,967 | 1. Military Research Hospital and Polyclinic, Independent Public Health Care Unit in Lublin |
Construction of a new hospital building intended for the central operating theatre with facilities, hospital wards and a helipad, as well as an extension of the main hospital building and changing of the roof structure |
| 2015-04-10 | 44,797 | LC Corp Invest XVII Sp. z o.o. Projekt 20 Sp. k. | Execution of the 2nd stage (building B) of the “Roździeńskiego” office and commercial complex in Katowice at Al. Roździeńskiego, together with the internal infrastructure |
| 2015-09-15 | 44,212 | Regional Court in Zamość | Completion of the construction of the building for the Regional Court and the District Court in Zamość |
| 2015-01-09 | 32,275 | PGNiG Termika SA | Delivery and assembly of the denitrification plant and retrofitting the flue gas desulphurisation plant for the K2 boiler at EC Siekierki in Warsaw |
Geographical structure of the Budimex Group sales in 2015
The Budimex Group operates mainly on the following markets:
- Poland
- Germany
The geographical structure of revenue from sales in 2015 is as follows:
Construction activities on the German market
In 2015, mainly workshop services were provided on the German market. Sales revenue in Germany amounted to PLN 174,854 thousand and in comparison with 2014 was higher by PLN 16,891 thousand, i.e. by 10.7%. The increase occurred both within prefabrication works (12.9%) and within metal-related works (3.5%). In 2015, the share of the metal-related works in the sales structure decreased by 2.2% and amounted to 31.7%. Operating profit on the German market amounted to PLN 21,220 thousand in 2015, whereas in 2014 it amounted to PLN 18,319 thousand. Profitability generated within prefabrication works was higher than the one generated in 2014 by 1.3%, and profitability within metal-related works was higher by 3.0% as compared with the previous year. Gross profit generated in 2015 was by 15.2% higher than in the previous year, which resulted mainly from higher sales and a lower write-down on receivables. Customer structure in both segments shows dispersion and the share of each customer in total sales revenue does not exceed 10%.
