Budimex Group Presentation for investors for 1Q 2008
Our strategy 40 years on the market Building long term value backlog value significant growth and structure change solid platform for future growth our goals: high quality service satisfaction of clients comfort of users profitability improvement backlog growth turnover growth shareholders value 2
Structure of the Group Budimex Group CONSTRUCTION BUSINESS Budimex Dromex S.A. Mostostal Kraków S.A. Sprzęt Transport Sp. z o.o. (designed for disposal) REAL ESTATE BUSINESS Budimex Inwestycje Sp. z o.o. Budimex Nieruchomości Sp. z o.o. (J.V.) OTHER ACTIVITIES Unibud Sp. z o.o. Companies consolidated with equity method 3
Description of the business Budimex Group CONSTRUCTION BUSINESS Infrastructure Construction of roads, highways, Renovations of existing roads, Construction of bridges. REAL ESTATE BUSINESS Residential development Development of residential property (flats). OTHER ACTIVITIES Timber frame houses Production and development of timber frame houses. General construction Residential construction, Non-residential general construction (office buildings, shopping malls, plants), Airports. Ecological Construction of sewage treatment plants, Canalization systems. Rental activity Rental of investment property to external clients. Operating one commercial parking lot. Other services Operating one hotel in Poland. Other activity (equity pick-up) Electro installation company (Elektromontaż Poznań S.A.), Production of switchboards (Elektromontaż Poznań S.A.), Highway licences (Autostrada Południe). 4
Stock exchange performance 1Q 2008 Warsaw Stock Exchange performance 1Q 2008 110,00% 105,00% 100,00% 95,00% 90,00% 85,00% 80,00% 75,00% 2007-12-28 2008-02-11 2008-03-26 WIG - construction WIG Budimex [PLN/share] 5
Market capitalization as at 31 March 2008 Capitalization as at 31.03.2008 vs competitors 5 000 4 500 4 000 4 298 3 715 3 500 3 000 2 500 2 145 2 139 2 000 1 500 1 379 1 260 1 131 1 000 500 0 PBG Polimex Mostostal Siedlce Polaqua Budimex Mostostal Zabrze Mostostal Warszawa Erbud 6
Construction market in Poland Dynamics of the production 2001-2008 30,0% 25,0% 20,0% 15,0% 10,0% 5,0% 0,0% -5,0% -10,0% -15,0% Dynamics of construction production 2001-2008 25,1% 17,5% 15,7% 17,4% 12,6% 5,6% 7,4% 0,6% 1,1% -0,2% 2001 2002 2003-0,9% 2004 2005 2006 2007 1Q 2008-2,3% -5,9% -8,0% -8,0% -12,0% Dynamics of construction production Dynamics of Budimex Group sales 7
Budimex Group Results 1Q 2008
Financial highlights mln PLN 1Q 2008 1Q 2007 Sales 653 654-1 % change 1Q 2008 vs. 1Q 2007-0,2% Gross margin 37 34 3 as % of sales 5,7% 5,2% Cost of sales and overheads -37-34 -3 as % of sales -6% -5% Result on sales 1 0 1 Other operating activity 11 1 10 EBIT 12 0 12 Financial activity 7 1 6 Gross profit 20 1 19 Net profit 16-1 17 Capital Expenditure -9-2 -7 Construction backlog (as at 31 March) 3 290 3 312-22 Presales of flats value 42 19 23 Land Bank (k m2 of flats) (as at 31 March) 255 9
Result by segments - sales sales 1Q 2008 592 71 27 653-37 sales 1Q 2007 Construction business Real estate business Other activities Elimination of internal transactions * TOTAL 73 29 654 574-22 * mainly Budimex Dromex (Construction segment) sales to Real Estate segment Construction business Real estate business Other activities Elimination of internal transactions * TOTAL 10
Result by segments - EBIT EBIT 1Q 2008 15 12 0-1 -2 Construction business Real estate business Other activities Elimination of internal transactions * TOTAL EBIT 1Q 2007 19 0 0-14 -5 * mainly Budimex Dromex (Construction segment) margin on sales to Real Estate segment Construction business Real estate business Other activities Elimination of internal transactions * TOTAL 11
Budimex Group Construction segment
Construction segment Financial highlights mln PLN 1Q 2008 1Q 2007 Sales 592 574 18 % change 1Q 2008 vs. 1Q 2007 3% EBITDA 4-10 14 as % of sales 0,7% -1,7% EBIT 0-14 14 as % of sales 0,1% -2,5% Gross Profit 10-12 22 Net profit 8-12 20 Capital Expenditure -8-1 -7 Construction backlog (as at 31 March) 3 290 3 312-22 13
Construction segment Sales structure Sales structure by type of works 22% 1Q 2007 4% 14% 32% 1Q 2008 2% 25% 60% General construction - residential General construction - non residential Infrastructure construction Other sales residential: 1Q2007 1Q2008 internal: 34% 45% external: 66% 55% Sales structure by markets 41% General construction - residential General construction - non residential Infrastructure construction Other sales 9% 1Q 2007 4% 1Q 2008 6% 0% 87% 94% Polish Market German Market Eastern Markets Polish Market German Market Eastern Markets 14
Construction segment Backlog structure Backlog structure by type of works 3% 31 III 2007 9% 31 III 2008 3% 20% 43% 45% 51% 26% General construction - residential General construction - non residential Infrastructure construction Others (German market) Budimex Group backlog General construction - residential General construction - non residential Infrastructure construction Others (German market) residential including: internal backlog: 21% 3 000 3 312 3 290 residential including: internal backlog: 44% external backlog: 79% external backlog: 56% 1 000 31 III 2007 31 III 2008 Contracts with value > 1mln PLN III 2007 III 2008 number of contracts 86 59 average value (mln PLN) 34 51 Budimex Dromex backlog value to be realized in 2008: 1.913 mln PLN (including backlog with gross margin 0 : 113 mln PLN) 15
Construction segment Contracts signed structure Contracts signed structure by type of works 4% 1Q 2007 9% 3% 0% 1Q 2008 36% 50% 37% 61% General construction - residential General construction - non residential Infrastructure construction Others (German market) 1 500 Contracts signed by Budimex Group 1 345 General construction - residential General construction - non residential Infrastructure construction Others (German market) residential including: internal contracts signed: 0% 1 000 500 784 0 1Q 2007 1Q 2008 Budimex Dromex S.A. 1Q 2007 1Q 2008 number of contracts signed 11 4 average value (mln PLN) 118 164 16
Budimex Group Real Estate segment
Real Estate segment Financial highlights mln PLN 1Q 2008 1Q 2007 Sales 71 73-2 % change 1Q 2008 vs. 1Q 2007-2% EBITDA 16 19-3 as % of sales 22% 26% EBIT 15 19-4 as % of sales 21% 26% Gross Profit 13 18-5 Net profit 10 14-4 Presales 42 19 23 Land Bank (k m2 of flats) (as at 31 March) 255 100% of J.V 1Q 2008 1Q 2007 Sales 103 64 39 % change 1Q 2008 vs. 1Q 2007 61% Presales 76 37 39 Presales (volume of flats) 103 85 18 Land Bank (k m2 of flats) (as at 31 March) 497 18
Real Estate segment Notary sales and presales structure by city Notary sales of flats structure 31% 1Q 2007 69 mln PLN 1Q 2008 68 mln PLN 16% 49% 42% 53% Warsaw Cracow Poznań 9% Warsaw Cracow Poznań 22% 1Q 2007 1% Presales of flats structure 1Q 2008 19 mln PLN 42 mln PLN 0% 1% 77% Warsaw Cracow Poznań 99% Warsaw Cracow Poznań 19
Real Estate segment Presales of flats Presales volume of flats (incl. 100% of J.V.) 1Q 2006-1Q 2008 300 250 200 150 100 50 0 1Q 2006 1Q 2007 1Q 2008 20
Real Estate segment Land bank Land bank ageing (k m 2 of flats), average flat is 59 m 2 (incl. 50% of J.V.) 300 250 103 15 255 200 91 150 100 50 10 36 0 2004 2005 2006 2007 2008 Land bank geographical structure (k m 2 of flats) (incl. 50% of J.V.) 10% 25% 65% Warsaw Cracow Poznań 21
Real Estate segment Land bank Land bank ageing (k m 2 of flats), average flat is 59 m 2 (incl. 100% of J.V.) 500 203 31 497 400 300 182 200 100 10 71 0 2004 2005 2006 2007 2008 Land bank geographical structure (k m 2 of flats) (incl. 100% of J.V.) 10% 26% 64% Warsaw Cracow Poznań 22
Budimex Group Other Activity
Other Activity Financial highlights mln PLN 1Q 2008 1Q 2007 Sales 27 29-2 % change 1Q 2008 vs. 1Q 2007-5% EBITDA -1-4 3 as % of sales -3% -15% EBIT -1-5 4 as % of sales -2% -18% Gross Profit -1-5 4 Net Profit -1-4 3 24
Other Activity Sales structure Sales structure by country 1Q 2007 1Q 2008 18% 19% 7% 10% 4% 68% 10% 64% Germany Poland U.K. Other countries Germany Poland U.K. Other countries Timber-frame houses backlog as at 31 March 2008 volume 300 250 200 150 100 50 0 249 63 31 13 German British Polish Other market 25