A good atmos phere all year round: At the headquarters of the DEVK insurance com- pany in Cologne, HOCHTIEF
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The HOCHTIEF Services division, established on January 1, 2008, brings together HOCHTIEF Facility Management and its ten foreign subsidiaries with HOCHTIEF Energy Management. The division provides services directly re- lated to the operation and maintenance of buildings and facilities. These services are offered for all phases of a project’s life cycle.
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HOCHTIEF Facility Management is further expanding its business in the area of production-related industrial serv- ices. Siemens confi rmed its faith in HOCHTIEF Facility Management with a follow-up contract. The HOCHTIEF sub sidiary will continue to operate various Siemens sites in Germany for a further six years. The contract with Siemens Real Estate is worth a total of EUR 192 million. HOCHTIEF Facility Management began managing some of Siemens’ facilities under an outsourcing agreement back in 2004 and has worked as a facility manager for the technology group since then. The Essen-based company ensures optimum production conditions and smooth operation of advanced production equipment in the Siemens sectors of Industry, Energy and Healthcare.
Project highlights
Automotive segment
In the reporting year, the HOCHTIEF subsidiary received from Daimler AG a contract to handle technical facility man- agement in the production shops of the Mercedes-Benz plant in Bremen. Roughly 13,300 employees work in the plant that covers almost 1.4 million square meters. HOCHTIEF Facility Management will operate the sophisticated technical building systems. This is our third contract for the car- maker: We already manage parts of Mercedes-Benz pro- duction sites in Mettingen and Untertürkheim.
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At the Basel research site Biopark Rosental, HOCHTIEF Facility Management assumed technical and infrastructure facility management. The contract is worth around EUR 6.2 million. The Biopark is for the most part a research and development center for companies from the chemical, pharmaceutical and biotech industries. HOCHTIEF provides infrastructure and technical building services to ensure optimum research conditions. For example, the company operates technical equipment to ensure optimum research conditions in cleanrooms and climate cells. The contract also includes the production of demineralized water for laboratories and the operation of a data center. It underpins the market presence of the HOCHTIEF Facility Manage- ment subsidiary, formed in 2007, in Switzerland. We secured a successful outsourcing project in Ludwigs- hafen in 2008 for the international pharmaceuticals manu- facturer Abbott. There at their plant, HOCHTIEF Facility Management ensures optimum conditions for the production of medical products. This includes the provision of gas, steam or water. We are also responsible for the cleanroom technology at the plant, making sure Abbott has the ideal environment for research, development and production.
Airports/aviation segment
HOCHTIEF Facility Management’s success in the airports/ aviation segment continued. For example, the company is making available, among others, its years of facility man- agement experience gathered at Athens Airport. The com- pany will take charge of maintaining the technical building systems at Stuttgart Airport’s four terminals for the next four years. Among other things, we are responsible for air- conditioning, sprinklers and control equipment. Special requirements have to be met as the technical equip ment is located in the high-security zones of the arrivals and de- partures areas.
*For further information, please visit our website at www. hochtief-facilitymanagement.com.
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Joining forces with other Group companies, HOCHTIEF Facility Management won, among others, the PPP contract to refurbish, redevelop, expand and operate the Fürst Wrede barracks in Munich. The facility management share of the contract, which will run for 20 years, is EUR 1.5 million per year.
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With its operations in Switzerland, Greece, the UK, Ireland, Poland, Hungary and the Gulf, HOCHTIEF Facility Manage- ment is represented internationally in markets which offer good business opportunities. Close cooperation with fur- ther HOCHTIEF units in Germany and abroad—in particular HOCHTIEF Construction, HOCHTIEF PPP Solutions, HOCHTIEF Property Management and HOCHTIEF Projekt- entwicklung—ensures that there is further potential for growth.
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Following the acquisition of Vattenfall Europe Contracting in 2007, we combined this business with our existing energy management business in the fiscal year to form the HOCHTIEF Energy Management group. The newly created company is one of Germany’s leading providers in the energy contracting sector.
Project highlights
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One important new order for HOCHTIEF Energy Manage- ment in 2008 was a contract with Gesellschaft für Bremer Immobilien: The company will carry out energy performance contracting for seven schools in Bremen for ten years and reduce energy costs by a total of EUR 319,000 per year. HOCHTIEF is guaranteeing a cost saving of 35 percent per year for the entire term of the contract. Among other things, we will refurbish central boiler units, install modern building control systems and optimize existing systems. Moreover, we will centrally monitor and control energy operations for heating and ventilation systems. In addition to the financial savings, HOCHTIEF will improve the schools’ environmen- tal performance: Their CO2 emissions will be reduced by
around 1,400 metric tons per year.
In summer 2008, HOCHTIEF Energy Management took on energy performance contracting for seven municipal prop- erties in the city of Bergisch Gladbach. Under the five-year contract, the city’s energy costs will be reduced by 35 per- cent per annum. The contracting covers, among other things, the city hall, school buildings with sports halls, and a library. Alongside a significant reduction in the city’s bud- get, HOCHTIEF will also be reducing the CO2 emissions of
the public buildings by 800 metric tons a year. To this end, we will refurbish central boiler units, optimize lighting sys- tems and install modern building control systems in the properties, among other things. In addition, HOCHTIEF will monitor, control and document energy operations for heat- ing and ventilation systems.
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Also in summer 2008, we were contracted to supply the regional airport Allgäu Airport Memmingen with heat. In June, HOCHTIEF Energy Management concluded a 15-year energy supply contracting agreement with the company Allgäu Airport. HOCHTIEF Energy Management is respon- sible for heat supply to the airport buildings as well as to buildings of other companies on the 144-hectare site. We additionally service and maintain related equipment. HOCHTIEF Energy Management secured a contract exten- sion in Hamburg Harburg where the company has already been supporting client ContiTech for more than ten years. It supplies steam, compressed air and service water for the production facilities of Continental and other clients. We also manage the electricity distribution network on the site. The economies of scale generated here through syn- ergy effects are passed on to our clients. The new contract provides for several new modernization and energy-saving measures. Based on changes in consumption profiles in recent years, it will be possible to further reduce CO2 emis- sions by more than 2,000 metric tons per year.
*For further information, please visit our website at www. hochtief-energymanagement.com.
7KH+2&+7,()6HUYLFHVGLYLVLRQőVNH\ƂJXUHV The HOCHTIEF Services division continued its successful course, surpassing its prior-year work done and earnings. At EUR 753.5 million, new orders were down 15.6 per- cent on the prior year. The 2007 figure had included a long-running public sector contract worth approximately EUR 320 million for school projects in the UK.
Work done was much higher than in the prior year at EUR 709.4 million (up 21.8 percent). This was due to the grow- ing additional services in existing business and new orders acquired in the prior year, including sports facilities projects in Greece. Added to this were effects from the acquisition in the energy management segment.
Operating earnings were 21.8 percent higher than in 2007 at EUR 26.8 million. 3URƂWEHIRUHWD[HV was also well up on the prior year at EUR 22.9 million. Energy man- agement and international business performed particularly positively. Profit was impacted by negative effects arising from acquisition activities, among others.
The average number of HPSOR\HHV over the year rose to 5,651, due in particular to growth abroad and acquisitions.
Outlook
As regards business in the HOCHTIEF Services division, it is also difficult to forecast the extent of the impact of the financial crisis on the economy as a whole and our industry segments. For this reason, we are concentrating on se- lected projects for now, so that we can maintain our high return-on-investment targets. The division is relying on organic growth and continuing to actively pursue outsourc- ing projects and strategic initiatives with low capital com- mitment because, in the facility management market, further opportunities could arise from the fact that clients are more willing to outsource.
Assuming that the present economic situation does not cause our clients’ ordering behavior to change more than is currently foreseeable, the division expects profit before taxes to be slightly higher than in 2008.
HOCHTIEF Services division
(EUR million) 2008 2007 New orders 753.5 892.6 Work done 709.4 582.3 Order backlog 1,560.0 1,602.2 Divisional sales 709.5 582.1 External sales 683.1 555.9
Operating earnings (EBITA) 26.8 22.0
Profit before taxes 22.9 20.4
Capital expenditure 11.1 16.5
RONA (%) 16.0 16.6
Net assets (December 31) 176.7 179.0