Budimex.pl

Current report no 17 / 2020

Date: March 16, 2020 3:21 PM

Effects of the outbreak of coronavirus COVID-19 on the activities of the Issuer and the Capital Group

The Management Board of Budimex S.A. informs about the possible impact on the activities of the Issuer and the Capital Group in connection with the spread of coronavirus COVID-19.

 

As a result of the spread of the coronavirus and the announcement of epidemic crisis in the Republic of Poland, the Management Board of Budimex S.A. is expecting a short-term interruption in the chain of foreign supplies (8 construction sites confirmed). We are also expecting an outflow of around 20% of subcontractors from Ukraine in connection with the closure of Ukrainian borders and a bulk of sick leaves (about 10-20% of workers). It is estimated that about 10% of employees from the Budimex S.A. Group who work in Germany will immediately want to return to Poland. The closure of the Lithuanian-Polish border will have a negative impact on the implementation of the contract in Lithuania.

 

At the moment, the Management Board of Budimex S.A. is unable to assess customer behaviour, but the main investors recommend continuing the work on the contracts. It is estimated that the situation may result in the failure to meet the final contractual deadlines of virtually all contracts, but it is impossible to assess their consequences as at the date of the report. According to the Management Board, the epidemic can be qualified as a force majeure event.

 

The short-term impact on the company's profit is expected to be negative, but it is currently difficult to estimate. In a long-term perspective, on the other hand, we are expecting a significant reduction in the level of investments in new contracts in each sector of the Group and a long-term shortage of certain materials and products, the effects of which cannot be assessed as of today, but they will be taken into account in the submitted bids.

 

In connection with the coronavirus outbreak and the dynamically changing situation, an epidemic crisis coordination team has been set up. The team was entrusted with the task of initiating and coordinating preventive measures related to the threat causing COVID-19 disease. It is also responsible for ongoing monitoring of the risks associated with the Issuer's activity.

 

The Management Board of Budimex S.A. informs that, despite the above circumstances, the current liquidity situation of Budimex S.A. and the Budimex S.A. Group is stable.

 

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Shareholdership structure as on 18.06.2020

GPWKNFRespect IndexSEGWIG Budownictwo
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