Tough measures at Implenia
Implenia announces extensive restructuring. The construction group intends to focus largely on its core markets of Switzerland and Germany and divest some business units. Implenia expects to make a loss in 2020.
Implenia's management is not satisfied with the implementation of the new strategy at Switzerland's leading construction group, saying steps need to be intensified and accelerated. In doing so, it announces "unavoidable, painful measures".
As Implenia announced on Tuesday, the company intends to focus on construction and real estate services in Switzerland and Germany in the future. Only tunnel construction and infrastructure projects are to be continued in other markets.
Implenia intends to dispose of or exit various business areas that are not strategic, profitable or part of its core business. In addition, the Group intends to reduce its shareholdings in other companies in order to improve its equity ratio.
End for unprofitable areas in building construction and civil engineering
Civil engineering (Civil Engineering division) is particularly affected by the measures. Activities in Sweden, Norway, Austria and Romania are to be sold or discontinued; the tunnel construction business in France is under observation. Implenia also intends to focus on selected regions in Switzerland.
In building construction, in the Buildings Division, unprofitable business units such as the German Implenia Bau GmbH will be closed. The activities in Austria are to be transferred to a new owner. In the Specialties Division, which operates as a general contractor in construction and engineering, non-strategic or unprofitable business units will also be sold or discontinued, such as Implenia Modernbau GmbH based in Saarbrücken.
Meanwhile, the Real Estate division is to be expanded: The division is to grow further in Switzerland with its development portfolio and also expand in Germany, according to Implenia. In the future, portfolio and asset management services will also be provided and scalable real estate products will be developed for international markets.
Implenia slips into the red
According to the company, the restructuring now announced will affect around 2,000 full-time positions by 2023. Implenia expects 750 redundancies, of which around 250 will be in Switzerland. The remaining 1,250 jobs are to be transferred to other owners. Implenia expects annual savings of more than CHF 50 million and an asset reduction of 20% by 2023. Restructuring costs are estimated at circa 60 million.
In the 2020 financial year, Implenia expects EBITDA of approximately -70 million. This includes the effect of the Ina investment transaction (+49 million), effects of the Corona pandemic (-50 million), extraordinary write-downs on projects amounting to 200 million and restructuring costs (60 million), it said. The order backlog is reported to be around 6.1 billion.
For 2021, Implenia is forecasting EBIT of more than 100 million and EBITDA of over 200 million. In the medium term, the Group is targeting an EBIT margin of 4.5%, which roughly corresponds to an EBITDA margin of 6.5%. (ah)
