“The civil engineering sector went through a time of lack of major investment projects and a decline in the number of tenders to assign construction contracts. Hidroconstructia’s revenue in 2018 also suffered from the shortage of skilled labor,” the company officials told ZF.
This is not the first case of construction companies affected by the lack of public sector spending. This often leads to losses or even insolvencies among companies. Ten of the top 50 construction companies by revenue in 2017 posted losses, ZF has found. The core business of six of those ten is road, highway or railway construction.
Hidroconstructia posted RON1.9 million profit in the first half of 2018, while its revenue stood at RON110 million. It had more than 1,900 employees at the end of November 2018, about 100 more than in the year-early period, according to Finance Ministry data.
Despite the revenue decline, Hidroconstructia officials say the company got more than RON870 million worth of domestic and international contracts in the second half, and the effects thereof will definitely show in the 2019 figures.(EUR1=RON4.6830)
(English version by Loredana Fratila-Cristescu)