UPDATE 1-Spanish builders seek fresh start with writedowns

Fri Mar 1, 2013 4:55am EST

Related Topics

* Three Spanish builders make huge writedowns

* Aim to shake off construction, energy losses

* FCC shares down 3.0 pct (Adds detail, background)

By Tracy Rucinski

MADRID, March 1 (Reuters) - Spanish builders have more fully recognised the devastating impact of a sharp construction downturn and misguided energy investments in their 2012 results.

Three of Spain's biggest builders - ACS, FCC and Sacyr - have each reported 2012 losses of around 1 billion euros ($1.3 billion) after writing down the value of investments.

Anticipating a downturn in construction after a decade-long boom that saw millions of new homes, hospitals and airports pop up across Spain, building heavyweights started to diversify into energy companies from around 2006.

The investments, mostly made at the top of the stock market, led them into debt they have struggled to pay off given a crippled construction business.

Spanish building and services firm FCC said on Friday it would sell at least 2.2 billion euros of assets in the next three years to cut debt which stood at 7.1 billion euros at end-2012, dwarving its market value of 1.2 billion.

It had said on Thursday it would write down losses in construction activities in central and eastern Europe and investments in real estate and energy companies.

Its shares were 3.0 percent lower at 8.675 euros at 0945 GMT after weaker-than-expected operating profit and the size of its writedowns.

"Although the restructuring exercise is definitely welcome, we believe that the size of the writedowns and the uncertainties on the extent of the damage could materially concern investors," Deutsche Bank analyst Luis Prieto said.

Peer ACS wrote down 1.3 billion euros against its stake in energy company Iberdrola, while Sacyr Vallehermoso wrote down its stake in oil major Repsol.

Sacyr was 1.5 percent lower while ACS was 0.6 percent higher. ($1 = 0.7649 euro) (Additional reporting by Sonya Dowsett; Editing by Dan Lalor)

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