Dutch civil engineering giant Royal BAM Group NV expects significant H1 loss and has announced that it will wind down BAM International.
The extraordinary circumstances caused by the Covid-19 crisis have a considerable impact on BAM. In addition, the company’s performance in the first half year has been impacted by continued losses at BAM International, the recently announced Cologne metro settlement and to a lesser extent by underperformance of the German construction and Dutch civil engineering business. Due to these developments, the company expects a first half year adjusted loss before tax of approximately €130 - €150 million. The Executive Committee has decided to start the process of winding down BAM International, active outside BAM’s European home markets, given the lack of a positive outlook.
The company lost approximately 35 per cent operational efficiency through the first two months of the coronavirus crisis and is now getting back to 80 per cent.
BAM International will deliver the current order backlog in line with client expectations and contractual obligations, but will not tender for new projects.
BAM International is the part of the business that deals with worldwide niche markets and the overarching BAM Group has not yet made any statement relating to the European and marine civil engineering aspects of its business.
By Jake Frith