Business | Construction
US crisis fails to prevent Hochtief from reaching full-year targets
Hochtief, Germany's largest construction company, met its full-year target for net income of more than 100 million euros ($146 million) as its US operations remained unaffected by the subprime lending crisis.
- Staff Report
- Published: 00:04 January 25, 2008
Frankfurt: Hochtief, Germany's largest construction company, met its full-year target for net income of more than 100 million euros ($146 million) as its US operations remained unaffected by the subprime lending crisis.
"So far, we have absolutely not been hit in the US," chief executive Herbert Luetkestratkoetter said in Davos, Switzerland. "The fourth quarter was very strong and orders at our Turner unit are at an all- time high."
Hochtief, one-quarter owned by Spain's Actividades de Construccion y Servicios SA, has expanded into markets such as airport management with steadier earnings than construction. The company extended its North American operations through the purchase of bridge-building unit Flatiron in September. Full- year profit was also spurred by mining and infrastructure work in the Asia Pacific region, the CEO said.
Luetkestratkoetter said all the company's targets for 2007 have "at least" been met and he's "very optimistic" that both sales and profit will increase further this year. The Essen-based company last year forecast an increase in new contracts, the order backlog and group sales over year-earlier levels. Net income totalled 89 million euros in 2006.
Hochtief climbed 15 per cent in the last 12 months on Frankfurt's stock exchange, boosting its market value to 4.43 billion euros. The stock rose as much as 3.7 per cent to 64.46 euros and was trading at 62.47 euros as of 11:57 a.m. local time.
Building bridges
Hochtief's Turner unit, the largest US builder, helped add $6.6 billion euros in sales in the Americas to Hochtief's group revenue of 15.5 billion.
The projects include two 14-story towers for a Hilton Hotel Corp resort in Florida.
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