FCC, the Spanish construction and infrastructure group, has welcomed a plan by the Spanish government to force indebted regional administrations to settle billions of euros of unpaid bills to service providers, which it said would help to reduce its €6.27bn of debt.
The company is owed €1.7bn as part of an estimated €30bn of unpaid bills from cash-strapped Spanish municipalities that have been unable to pay for services such as cleaning, rubbish collection and building projects.
Last week, the government said that it would force town halls, by the end of March, to reveal details of their unpaid bills and how they would pay for them.
“I think we will recoup 100 per cent of the debts owed by public administrations in this exercise,” Baldomero Falcones, chairman and chief executive, said as FCC reported its full-year results for 2011.
Mr Falcones said that of the total €1.7bn owed, approximately 80 per cent was for services, with the remaining 20 per cent for construction.
Spain’s municipalities owe €30bn, and regional governments €18bn, according to the lobby group Multisector Platform Against Bad Debts. Debts are counted as bad after 45 days of not being paid.
International revenues at FCC, which is majority controlled by Esther Koplowitz, Spain’s richest woman, represented 52 per cent of the €11.7bn total, which helped compensate for falling demand for infrastructure projects in Spain.
The largest area for international growth was in the Americas, up 48 per cent, while revenues in eastern Europe increased by 16.4 per cent.
Over the year, FCC said that its interest-bearing debt fell by 19 per cent to €6.27bn, helped by deconsolidating the debts of its subsidiaries Energía and Giant.
FCC said that its net profit for 2011 fell 64 per cent year on year to €108.2m. The sharp drop was caused by a €301m writedown at the company’s Cementos Portland unit. Without the adjustment, net profit would have come in at €316m, above the 2010 figure.
Earnings before interest, taxation, depreciation and amortisation fell year on year by 8.3 per cent to €1.25bn.
Of the ebitda total for the year, the company’s services division accounted for 65 per cent, with infrastructure comprising 35 per cent. Higher margins in environmental and municipal services helped offset lower demand for infrastructure projects in Spain, the company said.
FCC will decide on its next dividend payment at its next shareholder meeting, after paying out a total of €1.43 per share in 2011.
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