FCC to Revamp Business After Spanish Builder’s $1.3 Billion LossPatricia Laya
Fomento de Construcciones y Contratas SA, the Spanish builder that lost half its market value last year, said it will overhaul its business after having a 1 billion-euro ($1.3 billion) loss in 2012.
FCC will focus on its main business of environmental services, infrastructure works and water management as part of a three-year strategic plan that seeks to reduce debt and return to profit, said Juan Bejar, who became chief executive officer in February.
“The cement business is undergoing its worst crisis in history,” Bejar said on a conference call with analysts today. The company will present details of a strategy through 2015 on March 20.
FCC said it will cut investment in its energy, real estate, and telecommunication businesses. The Madrid-based construction company said yesterday it swung to a loss in 2012, while analysts had expected a profit of 38.4 million euros, according to the average of 10 estimates compiled by Bloomberg. FCC had 1.15 billion euros of restructuring expenses and costs from exiting cement and construction markets.
FCC set a goal of cutting debt by as much as 2.6 billion euros in the coming three years as it divests at least 2.2 billion euros of assets.
The stock fell as much as 3.9 percent in Madrid and was trading 3.3 percent lower at 8.65 euros as of 11:02 a.m. local time.
“The balance-sheet clean-up should be welcomed,” BPI analysts said in an e-mailed report today. “However, the underlying trends still show a deterioration of profitability in the main areas” of business.