French construction and services giant Vinci has posted a strong set of financial results for 2017 and said it “can look forward to 2018 with optimism”.
Group revenue was up 5.7% to €40.2bn (£35.4bn), with pre-tax profit up 9% to £5.7bn giving a margin of 16.2%.
Contracting as a whole generated a profit margin of 3.8%, up from 3.7% in 2017, while Vinci’s construction arm produced a 2.5% margin, significantly outstripping most of its UK peers.
The company’s order book showed an 8% year-on-year increase, with 11% growth in France and 5% uptick in the rest of the world.
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Revenue was boosted by a series of acquisitions in 2017, including 34 companies which joined its Vinci Energies subsidiary. Vinci Construction’s balance sheet was strengthened by the acquisition of Australian civils firm Seymour Whyte.
The construction arm claimed a number of new contracts throughout the year. In the UK, a joint venture with Balfour Beatty won one of the biggest HS2 lots tendered so far: the £2.5bn civils package for the line’s northern sections.
Vinci chief executive called the company’s 2017 performance “excellent”.
He added: “In contracting, there was a return to growth for both revenue and order intake in France. That was accompanied by an improvement in operating margins in the sectors that had been most badly affected by the recession. The group also carried out a number of acquisitions to develop its international presence, particularly at Vinci Energies.
“In concessions, business remained buoyant. Vinci Autoroutes’ heavy-vehicle traffic rose back to levels last seen before the 2008 crisis. Vince Airports continued to post rapid growth in passenger numbers at all airports. Three new airports will join its concessions portfolio in 2018: Salvador (Brazil), Kobe (Japan) and Belgrade (Serbia). Vinci Highways won new contracts in Germany and Russia. Lastly, the new South Europe Atlantic high-speed rail line connecting Tours and Bordeaux came into service on 2 July 2017. This exceptional piece of infrastructure illustrates Vinci’s ability to deliver major projects by using all of its expertise in synergy.
“In addition, Vinci took advantage of highly favourable borrowing terms and carried out a number of refinancing transactions, which significantly reduced the cost of its debt and extended its overall maturity.
“With our solid financial position, growing order books and promising operating environment in France and other major markets, Vinci can look forward to 2018 with optimism. All our business lines are likely to see revenue growth and the increase in operating margin in the contracting business should continue. We therefore expect further earnings growth.”