Much better shape: Bilfinger: Investors should take a closer look at this share – the reasons | message
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by Klaus Schachinger, Euro am Sonntag
D.he balance sheet for the first quarter will be presented by the engineering service provider Bilfinger on May 11th. The owners of the company, which has been badly shaken over the past few years, will give their vote in a few days at the virtual general meeting on April 15: on the Corona-shaped fiscal year 2020 and the surprising withdrawal of boss Tom Blades. In January, the successful restructuring engineer announced that he did not want to extend his contract, which was due to expire in the summer, and asked the supervisory board to release him from his position in chief with immediate effect. Since then, Bilfinger CFO Christina Johannson has also been the head of the Mannheim group. At your own request, only until a successor for Blades has been found. Blades and Johannson have stabilized the business model of the engineering service provider, which is active in various industries.
Together with 17 other companies, Bilfinger withdrew from the Nordstream 2 pipeline project in February. Many companies are subject to sanctions by the US government for their involvement in the construction of the Russian gas pipeline. Bilfinger generates almost a fifth of 3.5 billion euros in sales on the US market. A further collaboration on Nordstream 2 therefore seemed too risky for the Mannheimers.
Finally growth again
The shareholders should be pleased that Bilfinger is for the first time in a long time again forecasting significant sales growth for the current financial year. In the past year, the revenues had shrunk by a quarter compared to the previous year. However, the free cash flow will decrease again compared to 2020. Johannson, however, confirmed the goals for 2024: more than five billion euros in sales, at least five percent operating return (Ebitda), eight to ten percent return on investment (ROI) and more than 200 million euros in free cash inflows. In addition, Bilfinger wants an investment grade rating for its creditworthiness.
In order to grow, however, more investments will have to be made and working capital increased in 2021. In the past year, this was skimpy in order to increase the free inflow of funds from 57 to 93 million. The sale of Bilfinger’s former building management division Apleona also strengthened the balance sheet. The division was sold to financial investor EQT in 2016, but Bilfinger retained a 50 percent stake. EQT has now sold Apleona to PAI Partners. The deal brought Bilfinger a book profit of 210 million euros.
Boss Johannson is well equipped for the annual general meeting. In 2020, a net profit of 99 million euros remained in the box. Most of this should be given to shareholders. At 1.88 euros per share, the payout is much higher compared to the twelve cents for 2019. As promised by the board of directors, the owners receive at least one euro dividend per share for both years, also a signal for more stability, especially to the address of the financial investors Cevian and Ena Capital, who hold 26.8 and twelve percent of the Hold shares.
Potential takeover target
Bilfinger’s restructuring is said to have piqued the interest of rival Altrad and various financial investors. Boss Blades clearly refused to sell, his successor is not committed. Major shareholder Cevian has so far had little pleasure in the investment and could agree to a sale if an attractive offer is made.Updraft: For the next few years
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