This year's €157m figure for earnings before interest, taxes, depreciation, and amortisation (EBITDA) follows a €54m deficit for the same metric last year.
All activities contributed to the operational improvement, with the exception of Dutch civil engineering. There was very strong performance from Dutch construction and property and good contributions from United Kingdom and Ireland, the company reported.
The group reported an order book of €13.8bn and said that it is making good progress with its new strategy, with continued focus on restructuring the portfolio, reducing risk, increasing profitability and creating a sustainable platform for future growth.
Revenue increased by 17% compared to first half-year 2020, which was severely impacted by Covid-19.
Royal BAM Group CEO Ruud Joosten said: “The financial results for the first half of 2021 clearly show a strong improvement in BAM’s operational performance. All activities contributed to this positive development, except Dutch civil engineering which faced a significant cost overrun in the large contracts division. This reinforces BAM’s strategic decision not to tender for very large, single stage lump-sum projects. Our other platform for growth businesses had a solid performance, led by our Dutch residential activities which delivered a substantial contribution supported by high demand for new homes.
“I’m pleased to report that BAM employees are working enthusiastically on the execution of our strategy, 'Building a sustainable tomorrow', which we launched in February. In the first quarter, we successfully completed our major cost reduction programme. BAM has started group-wide programmes to further reduce our risk profile, step up our efficiency and capture the opportunities provided by digitalisation and the growing emphasis of clients and society on sustainability.”
The group divested two business units - BAM Swiss and BAM Facilities Services in Germany - and transferred BAM Indonesia to its management. In the Netherlands, it moved further towards sustainability and industrialised construction with the acquisition of off-site production facilities for modular construction.
“We have a solid order book and a healthy pipeline of opportunities coming from the public stimulus programmes in the United Kingdom, the focus of our clients on sustainable solutions, essential infrastructure improvement and the demand for affordable housing in the Netherlands,” said Joosten. “Against this background we are on track to deliver our strategic targets for 2023.”
Looking ahead, market circumstances are generally positive, said the company. However, it is experiencing industrywide pressure in some parts of the supply chain, there are ongoing discussions with clients regarding the timing and settlement of some substantial claims and Covid-19 uncertainties remain. For 2021, BAM anticipates an adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation) margin of around 3.5%.