Erbud does not rule out acquisitions; will improve MOD21 results this year

Erbud sees opportunities for further acquisitions thanks to its good cash position, although it also needs cash for the development of its subsidiary MOD21. Its profitability is improving, the management said, although it could still have a net loss or a result around zero this year.

"The Group's situation is very comfortable, we have PLN 300 million of cash [...] - this allows us in difficult times to “survive” safely, and in the good times ahead - 2024, 2025, 2026 and 2027 - it allows us to look at new acquisitions, although at the moment we don't have anything concrete [...], maybe something will turn up," Grzeszczak said during the press conference.

"Certainly we need to have cash for the modules [the MOD21 company], because here there could still be a loss this year. [...] But all the new projects are already giving us a profit, it's just a question of the number of these projects, the number of revenues that will cause whether there will be a loss this year or not. We assume that there will be a slight loss and that is why we need to have this cash," he added.

Vice-president Jacek Leczkowski pointed out that MOD21's sales margin is “growing and approaching expectations”.

"We already know that [MOD21] revenues will [this year] at least double, and we want them to triple. The result this year will be much better, but we don't expect to go through zero yet," he said.

He also estimates that this year MOD21 is likely to sign its first contract in wooden modular construction in Poland.

The management also said that due to the expected investment boom in Poland and the recovery in Germany, the entire group ‘will certainly grow in terms of revenue’ in the coming years. In volume construction, it assumes cautious growth.

"We are not focusing on increasing revenues in cubic capacity in a dramatic way. We are taking an even more cautious approach to contraction than usual, we want to raise a few hundred million [to the backlog] in the next few months. We don't want to double or triple in cubic metres, we slightly want to grow," Leczkowski also said.

Source: Erbud Group and ISBnews