Ballast Nedam Trading Update First Quarter 2010

NIEUWEGEIN, The Netherlands, May 7, 2010 /PRNewswire-FirstCall/ --

- Order Book Down Slightly to EUR 1.7 Billion

- Outlook for 2010 Unchanged: Operating Profit Between Approximately EUR 10 Million and EUR 15 Million

Situation in the first quarter of 2010

There was no improvement in the markets for property and infrastructure in the first quarter. Lower market volumes are causing increased competition and lower margins in public procurement.

There are signs of a stabilization in house prices. On the other hand, the volume in the housing market remains low, and is strongly dependent on consumer confidence. Unfortunately, uncertainty surrounding the future tax-deductibility of mortgage interest is undermining this confidence. On the other hand, the long-term shortage of homes of an acceptable quality is set to increase because of the lower volume of newly built houses in the short term.

The supply of major projects on the infrastructure market has grown because of planned additional central government expenditure. The volume of relatively small local authority infrastructure projects is under pressure.

The revenue and profit achieved in the first quarter were slightly higher than in the first quarter of 2009, mainly because of a higher contribution from major projects. The results of the prefabricated concrete companies are under pressure from a forecast revenue decline of 20%.

As we forecast, the order book contracted by 5% in the first quarter from EUR 1 818 million at year-end 2009 to EUR 1 729 million. The decrease was confined to the Building and Development division. The Infrastructure division succeeded in maintaining the order book at the high level achieved at year-end 2009.

The following projects were added to the order book in the first quarter, with a combined contract value for Ballast Nedam of approximately EUR 35 million.

    - Regional offices and a car park for the municipality of Bussum.
    - An office and a production site of 5,400 m2 in Eindhoven.
    - Sale of the new office building for Eiffel on the IJsseloord 2 business
      park in Arnhem.
    - Installation of 90 foundations for the Sheringham Shoal Offshore Wind
      Farm in the United Kingdom for the Danish contractor MT Hojgaard.

The net financing position decreased in the first quarter by EUR 93 million to EUR 185 million. The long-term loans increased by EUR 12 million to EUR 215 million because of higher PPP loans. The net cash included in the net financing position fell in line with the normal seasonal pattern by EUR 81 million to EUR 30 million.

The total investment in unsold property projects, both completed and under construction, decreased in the first quarter from EUR 30 million to EUR 27 million. There was a corresponding decline in the obligation to complete in relation to the unsold property under construction from EUR 20 million at year-end 2009 to EUR 15 million. The number of unsold homes fell from 184 at year-end 2009 to 172, and the 2 700 m2 commercial space under construction for lease to Eiffel for 15 years was sold in the first quarter.

Outlook for 2010 unchanged

The Board of Management maintains the March 2010 outlook of an operating profit for 2010 of between EUR 10 million and EUR 15 million, on a lower revenue than in 2009.

SOURCE Ballast Nedam NV