Ellaktor sees a return to profitability for its construction arm (Aktor) in the next 18 months after the completion of its capital boost, according to business plan.
The economic blueprint foresees a complete consolidation of Aktor over a 12-month horizon, so that the company operates without external financial assistance and it breaks even by the summer of 2022. Then, over a period of 6 months, ie until the end of 2022, it sees a return to profitability.
The recovery of construction is the most difficult part for the new Dutch shareholders, as Aktor is burdened with many problems, such as high obligations to suppliers and a portfolio with many loss-making projects.
Not coincidentally, from Ellaktor's 120-million-euro share capital boost, 100 million euros will be put aside for Aktor. The main message that the new administration wants to convey is that this is the last capital boost for its construction arm, which must become self-sufficient in a short period of time and, in a second year, return to substantial profitability. To achieve this goal, all available tools will be used: the capital boost, disengagement from loss-making projects, redesign of projects undertaken with large discounts to reduce losses, pay cuts and benefits as well as a reduction in staff levels.
At the same time, it is a matter of time before the implementation of significant administrative changes take place at the top of Ellaktor as sources indicate that the position of managing director will be taken over by Efthymios Bouloutas. The planned changes are attributed to the new period that the group enters after the Dutch investors successfully took control of the company.
There is also talk about the fate of Aktor's more than 1 billion-euro contracts for railway projects in Romania with some reports suggesting talk of transferring the contracts to either Archirodon or Intrakat. Ellaktor sources, however, categorically deny the possibility of transferring contracts to third companies.
It is recalled that in September 2020 Aktor had announced the signing of a contract for a railway project with a budget of 573 million euros without VAT in Romania, as head of a joint venture with ALSTOM and ARCADA. The project concerns the rehabilitation and upgrading of the Apata-Cata section of the Brasov-Simeria railway line, which is part of the European Rhine-Danube transport corridor.
It is the third section of this railway line undertaken by the subsidiary of Ellaktor Group, as in June 2019 Aktor had become the contractor for the upgrade project of the two adjacent railway sections Brasov - Apata and Cata - Sighisoara with a total budget of 627 milion euros, excluding VAT.