Bouygues Names Two Deputy CEOs Amid Plans for Successionby and
Telecom chief Roussat and CFO Marien to take new titles
Conglomerate says average revenue per mobile user stabilized
Bouygues SA, the French building, media and telecommunications company, appointed two deputy chief executive officers as chairman and CEO Martin Bouygues prepares for his succession.
Chief Financial Officer Philippe Marien, 60, and telecommunications business head Olivier Roussat, 52, will assist the billionaire scion of the eponymous conglomerate, alongside existing deputy CEO Olivier Bouygues, Martin’s brother. One of the CEO’s sons and a nephew joined the board in April.
Bouygues reiterated a 2016 target to improve profitability. After a decline in construction sales of 5 percent in the first half, orders showed signs of improvement, with signs of stabilization in the French construction market. The nation accounted for about 62 percent of Bouygues’ revenue last year, it said.
Overall, sales in the first half of the year fell 3 percent to 14.7 billion euros ($16.5 billion), the Paris-based builder said in a statement on Wednesday. That’s in line with estimates. Revenue was down 1 percent on a like-for-like basis, the company said. Operating profit rose to 206 million euros.
Shares of Bouygues traded 3.9 percent higher at 29.23 euros as of 9:48 a.m. in Paris.
The telecommunications business was boosted by the addition of 543,000 new mobile phone customers. Average revenue per mobile user also stabilized.
The conglomerate is reshuffling its telecom unit after talks to sell the business to France’s largest phone operator Orange SA collapsed in April. Phone and internet prices continue to be driven down by intense competition among France’s biggest four mobile operators. The pressure to offer discounts is diverting resources that could be used to fund the expansion of a high-speed mobile network, operators have said.
“From an operational perspective, I note the good performance of the telecommunications part with a significant gain in new customers,” Yohan Salleron, a fund manager at Mandarine Gestion, which holds Bouygues stock, said by e-mail. “Although there is little short-term catalyst, value remains attractive.”
Bouygues aims to reach a 25 percent margin for its telecom unit in 2017, with a plan to save at least 400 million euros this year, compared to 2013 levels, while investing around 800 million euros. The company reiterated that spending on network sharing with competing carrier Numericable-SFR group as well as other planned expenses are likely to result in charges of around 270 million euros, possibly affecting 2016 operating profit.