Duro Felguera | Cotización
28 February 2022

Duro Felguera obtains net profit of 22.6 million Euros after financial restructuring and launches new phase with good business prospects

The Company has received public support from the FASEE and the Principality of Asturias and has concluded its financial restructuring process

Monday, 28 February 2022. 2021 was extremely important: on 9 March the Cabinet Meeting agreed the authorization for Duro Felguera of the Solvency Support Fund for Strategic Companies, for an amount of 120 million Euros. Together with the refinancing agreement signed on 29 November and the financial support of the Principality of Asturias, this allowed the Company to strengthen its financial position and rebalance its assets for commercial purposes. In addition, a revolving bond line has been set up for 80 million Euros, with 70% CESCE coverage. As a result, the Company recorded a positive extraordinary net financial result of 37 million Euros, i.e. a profit after tax of 22.6 million Euros.

The EBITDA stood at -9.1 million Euros, compared to -138.9 million Euros in 2020. The Group’s activity in 2021 was slowed down by the effects of the health crisis and an uneven recovery in various different countries, as well as by the timing at the end of the year of the closing of the restructuring operation. A cost and overhead reduction plan was implemented in 2021 and continues in 2022.

Duro Felguera also holds good expectations for the immediate future. In new contracts, we could highlight the awarding of a project in the Netherlands for 100 million Euros, which enables the company to meet the order intake forecasts for 2021, with a total amount of 175.1 million Euros, 123% higher than in 2020. In total, the contract backlog at the end of the period amounts to 335.6 million Euros, of which 92% corresponds to international projects.

In relation to the delivery of projects in the backlog, the company has reactivated the 1500 MW power project in Djelfa (Algeria) through an agreement with the client, and is currently in negotiations to reactivate the Iernut project (Romania, 430 MW), both with firm prospects of successful completion.

In 2021, positive settlements were reached in litigation processes (General Electric, Stoneway Capital Corporation, Araucaria Energy S.A.), a trend that the company is currently continuing through negotiations in other litigations that are expected to be successfully concluded.

It should also be noted that the process of attracting a private investor is active. In addition to strengthening the Companys financial and/or equity position, the incorporation of a private investor will speed up the implementation of the viability plan. To date, non-binding offers have been received from potential investors and expressions of interest in the Group continue to be received and are being assessed.

The reactivation of the worldwide post-Covid economy, high liquidity in the market and the support of European and international funds are allowing the revitalization of industrial projects in many countries, which means great business opportunities for Duro Felguera.

The Company is working with its new organization towards a vision focused on consolidating its traditional, historically profitable lines (conventional Energy, Industrial Plants – Mining & Handling, Oil & Gas, Pressure Vessel manufacturing and Complex Industrial Plants – and Services), and boosting activity in the renewable energy, green hydrogen, energy storage and smart systems sectors, in line with the energy transition and digital transformation.

In this endeavour, Duro Felguera stands out thanks to its excellent references and high level of knowledge in different sectors; it will thus take advantage of the market dynamics to boost activity and fulfil its viability plan.