The Group's operating result excluding special items was DKK 16 million in the first half-year of 2014 compared to a loss of DKK 18 million in the same period last year.Expectations of an operating profit of DKK 150-225 million in 2014 are maintained.
MT Højgaard's turnaround starts to show in the accounts. The first half-year saw progress in results and improved profitability of orders, and cash generated from operations increased significantly.
The operating profit before special items reached DKK 46 million in the second quarter of 2014 compared to a loss of DKK 30 million in the first quarter. In total, operating profit for the first half-year of 2014 reached DKK 16 million compared to a loss of DKK 18 million in the same period last year.
- The many changes of our activities - both in relation to customers and internally - are beginning to make an impact. The profitability of orders increases step by step and our efficiency gets better and better. We are now starting to see the effect of this in the operating results, says President & CEO Torben Biilmann.
After provisions in the first quarter of DKK 195 million for an old offshore project, the aggregate result for the half-year was a pre-tax loss of DKK 179 million.
Orders worth DKK 7 billion
Revenue was DKK 3.2 billion compared to DKK 3.3 billion in the first half-year last year. In the second half-year revenue is expected to increase as a result of earnings from contracts won at the end of 2013 combined with new orders worth DKK 2.6 billion in the first half-year of 2014.
In addition to the current intake of new orders, the Group enterprises won various large single contracts such as a large PPP project in Vejle, a shell for the Technical University of Denmark Campus and yet another contract on the New University Hospital in Aarhus.
- We are very thorough when we look at new projects. We only enter into contracts which have a healthy risk profile and meet our earnings requirements, says Torben Biilmann.
In 2014 as a whole, the Group still expects to generate an operating profit of DKK 150-225 million, corresponding to an EBIT margin of 2-3 %, excluding special items. In the last two quarters of the year, the financial statements will continue to be adversely affected by the execution of old projects with low profitability - but to an increasingly lesser degree, and the Group's objective is still to reach an EBIT margin of 5% by the end of 2015.
The Group's results may still be affected by the outcome of a few as-yet-unresolved disputes concerning old offshore projects, the majority of which is expected to be decided this year. At present, these special items are expected to impact results negatively by DKK 195 million in 2014.
The expectations to the future financial trends are subject to uncertainty and risks which may cause the trends to deviate from expectations. For a description of risks and uncertainty factors, reference is made to the Group's most recent annual report.
The interim financial report is