The area of Construction, accounting for over 56% of company turnover sees an increase of 36.2%.
Company assets reach a total of 316.5 million Euros, an accumulated increase of 34.5% over the last five years.
The area of Real Estate grew by 63.6% with the purchase of Agofer.
The company consolidates its position in Poland and moves into Hungary in 2008.
Sando, one of the leading construction companies in Spain, had a turnover of 1,033 million Euros in 2007, an increase of 36% over the 759.4 million in revenues the previous year, exceeding its objective of 1,000 million Euros in sales. The company has achieved an accumulated average increase of 26.7% annually over the last five years.
Annual operating revenues totalled 70.1 million Euros, just under the figures registered in 2006 (74.2 million Euros) as a consequence of the downturn in the real estate market, although the annual accumulated average for the period 2003-2007 is 16.2%.
Sando has reinforced its capitalisation and its balance sheet. In December 2007, its assets totalled some 316.5 million Euros, 19.3% over the previous year. The accumulated average over the last four years has reached 34.5%, permitting the company a significant level of capitalisation. Company reserves have increased by 101.62%, as a consequence of the considerable appreciation of the book value of the company’s portfolio of holdings and promotions. This result is a consequence of Sando’s strategy to enhance its performance in the Real Estate area.
The NAV (Net Asset Value) evaluation of the company’s property holdings reached some 3,169 million Euros by year’s end, with a wide cost – market value margin. Furthermore, assets rose from 833 million Euros in 2006 to 1.397 million Euros in 2007, an increase of 67.69%.
Pre-tax profits totalled 70.2 million Euros as opposed to 162.54 million the previous year. This drop is due to extraordinary income in 2006 resulting from the sale of Sando’s 12.5% stake in the property developer DUSE. With this operation, Sando reduced its stake in DUCE, in which it participates with Realia, from 77.5% to 65%.
By business divisions, the Construction area performed well, with operating results of 33.8 million Euros, an increase of 36.26% over the previous year, accounting for 48% of the total. Total turnover in this area was 582.4 million Euros, up 34.07% from the previous year. The most significant events of the last year were the Albacete – Montesa Gas Pipeline; the Ahijones Collectors project in Madrid; Edificio Torres de Hércules in Los Barrios, Cadiz; the Trujillo – Cáceres motorway, section Santa Marta de Magasca – Cáceres; and the expansion of the Malaga Airport.
The Real Estate division saw a drop in its operating revenues of 31,36%, totalling 27.8 million Euros, accounting for 39.6% of total turnover. This decline is due to the acquisition of the whole of Agofer, and the results of the significant fall in sales in the real estate sector this year.
The Real Estate area currently has a portfolio of 7.9 million square metres of land for the construction of 2.7 million square metres of edification. This represents the equivalent of 21,700 units, or over 10 years of business operations.
Sando’s Real Estate division is a key player in the sector and has consolidated its presence in Poland and elsewhere in Eastern Europe such as Hungary. In Poland, Sando currently has promotions in Warsaw (Bemowo and Mokotow districts: 535 units). It has also made various further acquisitions, such as 143,330 square meters in Karczunkowska, Warsaw, for the construction of over 2,200 units as well as properties in Malaga, Madrid Sevilla and Tarrasa.
INTERNATIONAL EXPANSION AND ACQUISITIONS
Sando’s international expansion strategy, initiated three years ago and with a growing presence in Eastern Europe, has permitted the company not only to enhance and consolidate growth but also to minimise the effect of the downturn in the Spanish market. As the company consolidates its position through its Real Estate division in countries such as Poland, it has begun to develop other business areas such as Construction. Additionally, and in pursuit of this strategy, Sando has also undertaken projects in Hungary in 2008.
The search for new markets is one of the key strategies of Sando. The Concessions area is currently participating in various public tenders in Mexico and Peru and seeks to expand into other markets in Latin America.
Financing this expansion and acquisitions program has led to an increase in the debt levels of the company, rising from 643.4 million Euros to 1,432.5 million. This figure includes the 230 million Euros in debt of its subsidiary DUSE, a firm with significant property assets in Sevilla and included in the PGOU of 2006. This figure also includes mortgages subrogable to purchasers throughout 2008, totalling 270 million Euros, and the cost of the acquisition of Agofer, representing an increase of 410 million Euros in debt between financing and consolidated company debt.
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