The commentary of the President of the Management Board of Unibep SA on the results for the first half of 2021
“Approx. PLN 16 million of net profit (increase by approx. 70%. yoy), with sales at the level of approx. PLN 694 million (decrease by 5% yoy) – these are the results of Unibep Group for the first half of 2021. The boom on the development market continues. Residential, office, and industrial construction as well as infrastructure segment are doing well. Modular construction, despite a significant increase in sales, still has to improve its result. Our backlog of orders in construction and infrastructural part makes approx. PLN 2,2 billion, of which the second half of 2021 is worth approx. PLN 1 billion” wrote in his letter to shareholders Leszek Gołąbiecki, the President of the Management Board of Unibep SA. On 31 August was published the report for the first half of 2021 with the results of Unibep Group.
“Our development company, Unidevelopment SA, takes the advantage of the booming development market and growing prices of flats. In the first half of the year only, it had the results close to PLN 8,5 million net” added the President and announced that in case of Unidevelopment SA, the results anticipated for the last quarter of 2021 will be of bigger business significance for the Group.
Currently, the company has in the implemented investments 1560 residential premises. “According to the available market analyses, the real estate boom will last for at least few more quarters. This is caused by, among others, low interest rates, concerns about rising inflation, and the record level of household savings. It directly translates into higher demand for flats both among customers using mortgage loans and those having own capital at their disposal,” explained Leszek Gołąbiecki.
“Currently, as part of general contracting in Poland, we are running over forty construction sites in various construction segments. In this segment of activity our backlog of orders amounted to approx. PLN 1,3 billion and is, in my opinion, satisfactory. Prices of materials have been rising for several months which directly affects the level of construction costs. We constantly monitor prices and the way they affect individual construction investments. We focus on control and optimisation of costs, which allows us to minimise the adverse impact of market factors and enables us to reach the expected profitability,” wrote the president. “Importantly, our main clients are private investors with whom we talk about rising costs and effectively seek compensation in this regard.”
The president also pointed out to current international situation. “The current situation in Belarus severely limits our activity on this market. Therefore, nowadays we are focusing more on the Ukrainian market. There are advanced negotiations concerning subsequent construction investments. We will provide more detailed information in subsequent current reports.”
According to Leszek Gołąbiecki, the infrastructure segment in the first half of 2021 achieved the assumed financial results. It has a good backlog of orders which is approx. PLN 860 million for the second half of 2021 and subsequent years.
“Similarly, as with the general contracting, we monitor the increasing prices of materials, incl. asphalt and fuel. We also analyse their impact on individual investments and we continuously optimise the costs to reach the expected profitability. In the case of public contracts concerning large investments being conducted for several years, the contracts contain indexation clauses,”added the president in his letter.
“In the coming years, we focus on strong development of this segment of our business, because we want to take advantage of implementation of large infrastructure investments implemented in Eastern Poland. According to estimates, in the coming years significant funds will be allocated to these infrastructure investments from various governmental and local government programmes. That is why we are expanding the geographical activity of the infrastructure segment. We want to be present not only in the Podlaskie voivodeship, but also in Warmian-Masurian voivodeship , Lublin voivodship and in eastern part of Masovian voivodeship”.
Budrex Sp. z o.o., the company constructing viaducts, bridges, and other engineering structures has a backlog of orders worth approx. PLN 122 million and intends, similarly like the Infrastructure Branch, take advantage of the considerable number of infrastructural investments implemented in Eastern Poland.
Unihouse SA, a subsidiary of Unibep SA, manufacturing multi-family buildings in modular wooden technology, has a backlog of orders at the level of PLN 270 million (for the second half of 2021 and subsequent years). The dynamic growth in prices of wood and wood-based materials (incl. OSB boards by as much as approx. 40%) and other necessary materials directly translates into higher production costs of modules, therefore the Company constantly controls the situation, optimises processes in the factory and on construction sites and also conducts effective negotiations with its clients in the area of getting the prices of our products right.
“As the Unibep Group, we have a total backlog of orders worth PLN 2.2 billion, which is a very good result” wrote the president of Unibep SA. “Based on the analysis of the current level of orders and financial plans of individual segments, we expect sales revenues to increase in the second half of the year”.
He stressed the fact that in July 2021, it was the 13th consecutive year that, Unibep SA, in accordance with decisions made during the General Meeting of Shareholders in June, paid dividend in the amount of PLN 0.30 per share. This is the highest dividend in the history of Unibep SA. In total, the shareholders of the Company received over PLN 9 471 thousand. Own shares held by the company were excluded from the dividend payment. There are 3.5 million of them.
“We are optimistic about the coming months” summarises Leszek Gołąbiecki. “Considering the dynamic market situation, including changes in prices of construction materials, we focus with the utmost care on timely execution of contracts in every segment of activity, providing the highest quality and control of financial stability of the enterprise. We unchangeably conduct active acquisitions in all our business segments and we are gradually strengthening our personnel.”
It is worth adding that Unibep Group at the end of the second quarter of 2021 had 1586 employees in its payroll.