FRANKFURT: German construction group Hochtief targeted a jump of up to 37 percent in underlying net profit for the coming year as a restructuring programme under new Chief Executive Marcelino Fernandez Verdes takes hold.
Hochtief, controlled by Spain's ACS, said 2014 underlying net profit rose 46 percent to 252 million euros ($286 million), beating its own guidance and the average estimate of 239 million euros in a Reuters poll.
It proposed a dividend of 1.90 euros per share including a special dividend of 20 cents, up from 1.50 euros for 2013.
"Hochtief made crucial decisions with an eye to long-term success in 2014 and achieved significant progress," Verdes said in a statement.
But the guidance for underlying net profit of 220-260 million euros in 2015 was below the average forecast of 297 million in the Reuters poll.
Free operational cash flow rose to 322 million euros last year, from negative 214 million a year earlier, giving Hochtief a net cash position - of 421 million euros - for the first time since 2010, helped by 1.2 billion euros from Australian disposals.
External sales rose 1 percent on a like-for-like basis to 22.1 billion euros, while new orders were up 1 percent at 21.5 billion.
"Sales seem to be far below and adjusted earnings clearly better than expected on first glance," brokerage Alpha wrote, noting the difficulty of making comparisons as Hochtief adjusted its results for several portfolio changes.
Hochtief shares were indicated 1.5 percent higher at brokerage Lang & Schwarz ahead.
Australian construction firm Leighton Holdings, of which Hochtief owns 70 percent, said earlier this month that its 2014 net profit rose 33 percent to A$676 million ($534 million) and forecast between A$450 and A$520 million this year.
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