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Profitability of WSE-listed construction contractors and suppliers of building materials remains stagnant

02 Oct 2024


18 construction groups listed on the WSE delivered sluggish aggregate revenue performance in the last four quarters, with a year-on-year growth of 0%. Considering the price increase, this means a single-digit decline in real terms. Profit margins reported by the listed construction companies are still lower compared to figures delivered by home developers. Profitability posted by suppliers of building materials and construction equipment has stabilized at pre-pandemic levels.

The findings of "Construction Market in Poland – October 2024", the latest monthly report released by Spectis, reveal that the aggregate revenue of 18 construction groups whose shares are listed on the WSE totalled PLN 32.9bn in Q3 2023-Q2 2024, a result similar to the previous year. Stagnation in terms of revenue is primarily due to a persistently weak market situation in building construction and a brief slowdown in civil engineering. The aggregate net profit of the analysed companies in the period under review amounted to PLN 668m, as compared with PLN 835m a year earlier.

 

The net financial result generated by the construction companies translated into a net return on sales of 3.3% compared with 2.1% a year earlier. Profitability of the other two categories of companies related to the construction sector, i.e. property developers and suppliers of building materials and construction equipment, was much higher as it stood at 16.3% (compared to 15.6% reported in the previous year) and 4.1% (down from 5.9% last year), respectively.

Net profit posted by WSE-listed construction companies was largely driven by the continued strong profitability recorded by the Budimex Group, which is the largest construction company in Poland. The industry’s strong financial performance was also boosted by results posted by Mirbud, Dekpol and Trakcja, which reported net profit increases over the past year. On the other hand, the deepening financial losses in the Rafako and Polimex-Mostostal groups had an unfavourable impact on the industry result.

From among property developers listed on the WSE, Dom Development, Atal, Develia, MLP Group, Archicom, and Murapol posted the highest net profit margins in the past four quarters. In terms of value, the strongest profit improvement was registered by MLP Group, Archicom, Cavatina Holding, Dom Development, and Ronson. On the other hand, significant profit losses were recorded by Warimpex, PHN, Murapol, and Marvipol.

As far as producers and suppliers of building materials and construction equipment are concerned, in the past four quarters, the Kety Group recorded the highest net financial profits. It accounted for over a half of the profits generated by all the suppliers. Robust profit figures in excess of PLN 40m were also delivered Selena, Decora, Śnieżka, Ferro, Cognor Holding, and Rawlplug.

For more information about quarterly results of market players, see our monthly reports "Construction market in Poland".

Long-term financial results, ongoing contracts, and market strategies of the leading contractors can be found in the report entitled "Construction companies in Poland 2024-2029".

Sales figures, ongoing projects, and market strategies of the leading property developers can be found in the report entitled "Residential property developers in Poland 2024-2029".

 

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info@spectis.pl