Bouygues reduces debt, sees profits slightly down

The French construction giant has posted first-quarter 2010 results showing a big reduction in its net debt but a slight fall in its operating profits and sales.

Bouygues, one of the ‘big three’ French developers (along with Eiffage and Vinci), has unveiled results for the first quarter of 2010 showing net debt reduced from €5.43 billion to €3.23 billion, while gearing fell by 29 percent to 32 percent.

The firm reported a small rise in its outlook for 2010, predicting that revenue for the year would be €30.1 billion rather than the €30.0 billion originally forecast.

Group operating profits were down 2 percent on the first quarter of 2009 at €162 million, and first-quarter sales were also down 2 percent at €6.4 billion, dragged down by the roads business.

Colas, which is Bouygues’ largest division by revenue and which builds roads and carries out infrastructure projects, reported an operating loss for the quarter of €202 million, compared with a loss of €115 million a year previously.

Yesterday, Bouygues CFO Philippe Marien declared the tram-train PPP on the French Indian Ocean island Reunion – was no longer viable. Bouygues had been a consortium participant for the PPP, which was shelved when a new president of Reunion was elected earlier this year.

Marien said the president has plans to build a new road, but told Reuters it would take five or six years “before we see new projects on the table” in Reunion.