By Michael Susin
Royal BAM Groep shares rose after the group outlined a share buyback and raised its dividend on expectations for a positive order book despite the challenging short-term backdrop.
Shares are up EUR0.29, or 11%, at EUR2.84, and are currently up 17% over the year to date.
The Dutch construction-services business said Thursday that it will start a 30 million-euro ($32.2 million) share buyback program and propose a dividend of EUR0.20 a share, up from EUR0.15 a year ago.
The company reported a net profit drop for 2023 to EUR175.0 million from EUR179.6 million a year ago, as revenue fell to EUR6.27 billion from EUR6.62 billion.
Adjusted earnings before interest, taxes, depreciation and amortization–the company’s preferred metric, which strips out exceptional and other one-off items–fell to EUR304.3 million from EUR350.2 million, while the margin decreased to 4.9% from 5.3%.
Looking ahead, the company said it will continue its dividend policy to distribute a dividend between 30% and 50% of the net result and consider further share buybacks as part of its plans for 2024-26.
It also expects to deliver an adjusted Ebitda margin of between 4% and 6% for the same period.
However, the group warned that market conditions will remain challenging in the short term, but said its order book remains at a good level of EUR9.8 billion.
“For the medium and longer term, we see attractive market opportunities supported by demand for decarbonisation, critical infrastructure and sustainable and affordable homes, where we have proven market-leading capabilities,” it said.
Write to Michael Susin at [email protected]
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