DM BDM recommends "reduce" Budimex, target price PLN 171.3

On the day the report was issued, the price of Budimex shares was PLN 184.4.
"Reported Budimex results for the first quarter were more or less in line with consensus and expectations." The company generated a net profit of PLN 63 million, with expectations of PLN 65 million, while also paying attention to another strong decline (by 77 million PLN) the balance of provisions for losses (currently the lowest since the second quarter of 2009) and the erosion of the gross margin in the developer "- it was written in the report.
"Despite the high dynamics on the revenue side (record backlog), the margin erosion in yoy perspective will be also visible in the following quarters of 2018 (we also see a limited margin for improvement in the first quarter), which will imply pressure on EBITDA and net profit "- added. According to DM BDM's forecast, Budimex's EBITDA will fall to PLN 478.4 million in 2018 from PLN 625.8 million in the previous year, while net profit will decrease to PLN 351 million from PLN 464.4 million. The group's revenues - according to the forecast - will increase to PLN 7.1 billion from PLN 6.37 billion a year earlier.
The report, written by Krzysztof Pado, was first released on May 11 at 12.25.

Source: company website, investor relations, current and periodic reports.

Company information
Company name:Budimex SA
Adress: ul. Stawki 40 01-040 Warszawa
Phone:+48 22 6236000

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