Hello, and a warm welcome to the earnings call of PORR AG regarding the H1 figures for 2026. I would like to welcome CEO Karl-Heinz Strauss and CFO Klemens Eiter, who will guide you through the figures in a moment, followed by a Q&A session via audio line and chat. With no further ado, I hand over to Head of Investor Relations, Lisa Galuska.
Hello. Thank you, Monique, and also a warm welcome from my side to today's conference call. As always, please find all the relevant materials on our website, www.porr-group.com/ir. Now I am happy to hand over the call to Mr. Karl-Heinz Strauss.
Thank you, Lisa. Good afternoon, ladies and gentlemen, and thank you for joining us on today's conference call discussing our half year results in 2026. Now let us start with a quick overview of today's topics on slide number three. Civil engineering continues to be the main growth driver in construction. Besides that, building construction is also gaining positive momentum again, especially residential construction has now bottomed out and is expected to rise again in the near future. Non-residential building construction, like our products for healthcare and industrial clients, is already further along on an expansionary path. Also, in Germany, the turnaround is now clearly visible across all construction sectors. In addition, we expect a further push coming from increasing tend activities in October, but more on that later. Looking at order backlog, we again see an increase compared to the same time of the previous year.
While both countries, Austria and Germany, showed double-digit growth, the overall order intake was impacted by an unfortunate cut-off date. In terms of revenue, the second quarter saw a strong rebound after the harsh winter in Q1. As we already have the July figures, we are confident that the speed will pick up further in the upcoming months. Once again, we delivered as promised. Not only did our EBIT rise to EUR 56.3 million, pushing the EBIT margin up to 1.9%, but also our earnings per share increased by impressive 34%. On our balance sheet, we see the usual seasonal increase in working capital, this time amplified by the strong winter. In addition, we invested in medium-sized M&A activities and financial assets. Last but not least, we are able to give a more clear guidance on this year's results.
We expect output and revenue to come in around 2%-4% above the previous year's figure, and an EBIT margin in relation to revenue of 3.2%-3.3%. Let me now start with a brief discussion of the current market environment on slide number four. According to the most recent forecast of EUROCONSTRUCT, the construction industry is set to expand further. That said, the recovery in residential building construction is picking up momentum with the highest growth figures forecast for 2027 before reaching a more sustainable level in 2028. Here, PORR sees good opportunities with its PORR LIVING product portfolio. With our broad competencies and know-how in specialist building construction sectors like healthcare, data centers, and clean rooms, we also expect a further push in non-residential building construction. Recently, we saw an additional uptick in orders for educational buildings, proving the positive sentiment in the sector.
Nonetheless, infrastructure will continue to be the major growth driver, especially in the Eastern European markets. This is supported by the still ongoing investments in relation to the Recovery and Resilience Facility and the multi-annual EU budget. Please follow me to the right-hand side of this slide for further details on the planned infrastructure investments. We see that especially our CEE home markets of Romania and Czech Republic continue to invest heavily. In Poland, we expect further major order intakes as we currently show high competencies in tunneling at the CPK Łódź tunnel construction site. Austria, our backbone market, continues to follow the investment plans of its infrastructure operators, Austrian Railway Organization and ASFINAG, making it a reliable market. The next big construction site of Europe, Germany, is seen to finally pick up speed.
With the Infrastructure Future Act, planning on approval processes are accelerated, and we expect a strong uplift in tendering and awarding activities in October of this year. I already talked about the current and upcoming order intakes. Let us put a figure on that on slide number five. Shown here on the left side is the order intake of the last 12 months. The slight decrease of 5.7% compared to the previous period is primarily due to an unfavorable cut-off date. Last year, we got a major order from Poland on the last days of June, whereas this year we had several big order intakes in July. Nonetheless, we again managed a double-digit increase in both of our biggest home markets, Austria and Germany.
In addition to that, the previously mentioned increase in building construction is also clearly visible here with a share of new orders amounting to around 36%. In July and August, we received several new important orders, especially from Germany. Deutsche Bundeswehr signed a three-years framework agreement worth EUR 270 million for the construction of new barracks, with the first order call expected in the next days. In addition to that, we already signed three new building projects worth EUR 100 million in total and are about to sign in a high-margin industrial building construction contract of another EUR 100 million with a well-known grocery store chain in Germany. Further building construction projects totaling about EUR 200 million are expected in the next few weeks. In parallel, PORR was able to gain infrastructure projects in Poland after the cut-off date with a volume of EUR 180 million.
Besides that, the tendering activity in our home markets continues to be strong. Regarding the already mentioned pipeline in Germany starting in October 2026, we expect to participate in infrastructure tenders worth EUR 1.5 billion. In Poland, we are currently negotiating projects for a total volume of EUR 400 million- EUR 500 million. The same is true for a major road construction project of EUR 550 million in Romania, which is ready to be signed as soon as the new government picks up the work. You see, market activity is strong. Still, our focus is on selective order intake. Cherry-picking is the key word here. This can clearly be seen in our order intakes of the second quarter of 2026 on slide number six. On the far right side, you see only major building construction projects. All of them are located in high-margin sectors, further improving our order book.
With a value of more than EUR 100 million, PORR won the contract to building clean rooms of Fab4Micro in Erfurt. As one of the very few clean room providers in Europe, we benefit from our high competencies here and a unique track record. Another industrial construction contract are the structural works we are providing for Swift and Apple in Munich. Here, PORR is able to apply its expertise as a strong partner for major industrial players. The HMS 51 Holzmarktstraße 51 and apartment building Seestädter contracts are both residential construction projects. Also, the first is termed a mixed-use complex. This is something we see on an increasing basis and expect to come in more frequently. In Poland, we were awarded a contract for a munition storage, emphasizing also the increasing need for military infrastructure.
If you now follow me to slide number seven, you will see the results of this quarter's order intakes. Nearly all operational segments contributed to the growth of 4.4% in our order backlog. Only infrastructure international saw a reduction due to continuously working off the existing orders while showing a high capacity utilization. With the additional contracts won in July and August, we would not only surpass the EUR 1 billion mark again, but also show a double-digit increase compared to last year. Coming to our P&L figures, please follow me to slide number eight. Compared to the first quarter of this year, Q2 saw an improving development in revenue. This is set to further accelerate in the second half of 2026. Our top line continues to be solid despite the strong winter. In some markets, we had snow until April.
This particularly impacted building construction, which was held back by 2.6% compared to last year's period. In contrast to that, civil engineering, which is more independent of the weather conditions, increased by 7.2%. Another topic here is the higher share of joint ventures. This has not only reduced revenue as they are accounted for in separate line in the P&L, but also increased the income of companies accounted for using the equity method. Having said that, this leads me directly to brief glance at the input cost environment on slide number nine. Truth be told, material and energy costs are rising. However, our hedging work and consequent cost management continue to pay off. With gas and electricity fixed up until 2030 and diesel consumption regularly monitored, we are confident for the ongoing geopolitical uncertainties.
Please follow me to the next slide, number 10, to see that the war-driven material cost increases are well controlled. Cost of materials and purchased services declined by EUR 59 million and contributed 1.25% to the EBIT margin development. OpEx remained stable. Despite an expected increase in personal expenses driven by collective bargaining agreements, we were able to further expand our EBIT by 15.6% to EUR 56.3 million. Also, due to the profit increase in our operating construction JVs. The EBIT margin stood at 1.9%, another increase of 28 basis points. Please be aware here of two one-off effects weighing each other up. First, we had extraordinary gain from the sale of business premises on an at equity company of EUR 6.4 million. Second, we had to depreciate EUR 7.4 million in connection with the expected sale of our PWW Group in Serbia.
That said, we also managed to improve our result for the period by 23.9%, while our EPS grew by 34% to EUR 0.71 per share. Coming to our balance sheet, let me start with our equity on slide number 11. Due to the weaker business in first half year in European construction and dividend payments, equity decreased slightly by 1.8% compared to the end of last year. In relation to June of last year, PORR again managed to absolutely increase its equity position by EUR 92 million or 10.8% while maintaining a stable equity ratio of 20%. In terms of debt, we have several factors to discuss on slide number 12. As of the end of the period, our net debt stood at EUR 461 million, with around EUR 220 million being bound by IFRS 16 long-term office rentals.
A major part of the increase of EUR 159 million compared to last year comes from the investment in medium-sized M&A, UBM hybrid capital , and an increase in CapEx. Let me discuss the issues in detail. In the first half of 2026, PORR took the opportunity to acquire a majority stake in rhtb: group. This drylining specialist complements the strong portfolio for system residential construction in Austria and Germany. They provide heating and cooling systems, making it a valuable addition to our PORR LIVING product line. Speaking of PORR LIVING, I want to continue with our investment in UBM hybrid capital. This is paying a substantial interest of 9% per annum while providing us with a skilled distribution partner in residential construction. Last but not least, half year 2026 saw clear increase in CapEx. EUR 20 million of this is attributable to a tunnel boring machine in Poland.
This kind of machinery is usually bought either on a leasing base or in an at equity company, which is why they are normally not on our balance sheet. For the full year, we therefore expect an increased CapEx ratio of 4.5%. Our cash flow is also strongly impacted by the long-lasting winter this year. The seasonally negative cash flow from operations was further impacted by the late start of the construction season, which also led to a delay in billing and set off a longer cash conversion cycle. This can be seen in the cash flow from operations of EUR -258 million. Nonetheless, we expect a clearly positive figure here for the full year. This directly leads me to my last slide for the day, our outlook. We are convinced of the continued growth of the construction industry.
Due to long-term investment programs of public infrastructure operators, demand for civil engineering, especially for roads, railways, tunnels, and bridges, is unbroken, as is the need for modernization in all of our home markets. In Germany in particular, the infrastructure package is about to finally hit into the market in October. We expect the first wave of tenders to have a volume of around EUR 1.5 billion. Building construction has already gained momentum. We already won several large building projects in industrial, public, and residential building, even more to come and to be signed. With our new colleagues at PORR Healthcare, we are optimally positioned for further growth in the field of smart hospitals. Due to the long winter, output and revenue generation started delayed this year. However, based on the strong order backlog, they are now in full swing.
On the basis of this, we expect an increase in output and revenue of 2%-4%, as well as an EBIT margin of around 3.2%-3.3% for 2026. The target by 2030 is an EBIT margin of 3.5%-4%. With that, I want to thank you for your attention so far and would like to open the call for your questions.
Thank you very much for the presentation. Ladies and gentlemen, now it is your turn. We are opening the Q&A session. If you would like to ask your questions in person via the audio line, please click on the raise hand button. If you are dialing in by phone, please press star key nine to raise your hand and star key six to unmute yourself. Additionally, you are also welcome to post your questions in our chat, and we will read them out for you. As I can see, there are already some risen hands. Philipp Kaiser, I will allow you to unmute yourself, and you should be able to ask your question.
Hello, everyone. Can you hear me?
We can hear you.
Perfect. Thanks for the presentation and thanks for taking my question. Just a couple from my point. Just starting with the composition of the earnings improvement. EBITDA rose by EUR 17.7 million, also driven by equity contribution, as well as you mentioned one-off effect and also by higher operating income. Just a couple one on that topic. You already mentioned it, but could you repeat what caused the one-off gain? I understood it is sale of an at equity company.
We have been selling some business premises in a JV, and our part of the gain there is the EUR 6.4 million. That is included in the income from at equities.
Okay.
That of course, that is also included in the increase of EBITDA. On the other side, we are expected to sell the PWW Group, and had a depreciation of EUR 7.4 million that is included in depreciation. So if you take both of them as a one-off, the total impact of the result is EUR 1 million negative, but the gain is included in EBITDA and the depreciation is included a little bit further down in depreciation line. Is that clear for you now?
Yes. Thanks a lot for the clarification. That helps. Is it possible to quantify the recurring at equity run rate for the second half of this year? Do you plan any further sales?
Well, not really. Our guidance is, in general, our expected earnings and result from the business.
Okay, perfect. Coming to the increase in other operating income. Could you shed some light what drove the increase and how much of this recurs in the next quarters?
Well, I think in total, if you look at our earnings and EBIT development, the most remarkable development is the decrease in cost of materials and purchased services of 1.25% contributing to the positive EBIT development. I think this is the most remarkable point. Also, I think remarkable with regards to the general development that we see on the market. We see in general energy and materials going up, but we have always been saying that we are pretty well hedging and managing the situation and that most contributed to the EBIT development. On the other side, we see increases in personal expenses. We know about the negotiations with the workers' council, so that is expected increases.
Besides that, I think the most obvious line of increase is income from the JVs, where half of it was now coming from the increase coming from that sale of that business premises, and the rest is increased share in business in so-called ARGE joint ventures, operating joint ventures, and these are sustainable. In other operating income, we got a small increase that is also related to these JVs as these are costs that we put forward to these operating JVs. Summing it up, yes, these developments are sustainable as they are reflecting the increased number of operating JVs we are seeing.
Okay, so that would also be the kind of going forward increase the share in JVs so that, yeah, the equity component will further rise, which is kind of part of your general business.
Well, I think that is the specialty in construction, especially in our region in Austria and Germany that you do part of your business together with other companies in the field. Under IFRS, we are not allowed to account for that using a pro rata share, but we need to show that in one line as a result, as earnings from JVs. That is why on the other side, revenue is missing there. Yeah. As no revenue can be accounted for. It is only the single line earnings, but they are important in our business here.
Okay. Thanks a lot for the clarification. Speaking of material and cost of materials and decline there, you already mentioned it, the improved cost ratio. Just for my understanding, given that gas and power are broadly fixed and also gas is secured by hedges even beyond 2028, how much of the materials improvement is kind of pure lower weight of subcontractor-heavy building construction rather than procurement? Will that ratio then increase when building construction volumes return?
Well, what we see in general is that we are. The line item is including both cost of materials and purchase services and subcontractors. Actually, we still see some pressure on market prices. In this position here, you can see that we are pretty well able to forward price pressure from the markets to our subcontractors. That is in the end, probably half of the secret here of the increase in earnings on the other side, pretty well managing the material situation.
Okay. Even if the building construction volume would return, then there is no sharp increase in this ratio to expect it?
Well, then, actually, I would expect that the prices would also increase as the pressure on the prices is not that high anymore when the volume is higher. Maybe t he ratio is going a little bit up, but the prices will also go up. I don't think that we expect some downside from that. Actually, as we got some surplus on the purchase services, I would expect to have that positive impact, sorry, on our earnings.
Perfect. Understood. Very, very helpful. Going back to your balance sheet or the working capital. You already mentioned it during the presentation, operating cash flow EUR -258 million, driven by a working capital build. How much of this will release in H2? What base net debt do you expect for the year-end?
Well, our target for the year-end is to be net debt free. Meaning in total, having a total cash balance in the end, where the IFRS 16 liabilities of about EUR 230 million are already included. If you put that down in an operating cash flow expectation, it would mean that we expect to be able to produce sufficient operating cash flow and returning working capital and receivables. Actually, as we've been saying, we've been impacted on working capital site also by the long winter. Actually, we had some snow that has been falling again in April after the first quarter. In building construction, actually, we ran at full speed at that time. That also means not only some downside for revenue and output, but also on working capital as we are only able to invoice our services after we've provided them.
We have some latency, and we expect to recover that and expect some normal cash flow, operating cash flow and net debt development for the end of the year.
Okay. The net debt free target is already including the IFRS 16 debt.
Yes.
Okay, perfect. Thanks a lot. Speaking of harsh winter and late invoicing, also your receivables rose compared to last year. Is it possible to quantify how much of that build is pure late invoicing and will unwind mechanically during the second half of this year?
Well, I think it's hard to put that really down to that effect. I think, talking about the outlook, I think it's more material that we think that's a temporarily effect and we will be able to recover to a normal cash flow and working capital development over the whole year.
Actually, if you look at our cash flow and working capital, you always see some effect, especially during the summer months until autumn, until September. Our operating cash flow has always been negative in the first half year. It's a little bit in excess, but we've been showing that we're able to turn that in the second half to a significantly positive operating cash flow figure.
Perfect. Understood. My last one, and then go back in the queue, is on the revenue side of your guidance. You quantified the guidance and now expecting full-year revenue growth of between 2% and 4%, which implies an increase of roughly 5%- 10% after the slight minus after the first half of the year. Could you explain what drive the catch up? Is it just the catch-up effect of the delayed season backlog conversion? Any insight would be very helpful.
Well, if you look at our business segments, you see that in building construction, we had a decrease in revenue of, I think, 2.6% so far. So you directly see the impact of the long winter as we have a decrease in that part. On the other side, and we are now catching that up, so by the end of the year, we are sure that we turn this at least into a black zero. On the other side, in civil engineering, which is not that much impacted, as you always have a longer winter and the starting couldn't be earlier, we have an increase of 7.2%. This is showing that's driven by our backlog, and that's where you see that growth is also coming to our revenues. When we are not impacted by some special conditions like the weather in the first half year.
If you put that together, the positive development in infrastructure and the temporarily negative effect in building construction expected to recover for the end of the year, you get to our expectation of an increase in total. That's not a very high level of increase, but an increase of, we've been saying now, 2%- 4%.
Perfect. Very helpful. Thanks a lot for the information. I will go back in the queue.
Thank you very much. The next raised hand is from Andreas Wolf. You should be able to unmute yourself and ask your question.
Hi, it is Andreas from Berenberg. Can you hear me well?
We can hear you.
Yes. Hi, Andreas.
Yeah, great. I have also a couple of questions, but not that many. The first one is on the order intake. Could you comment on the order funnel that you have for the remainder of the year? I am just curious how the incoming orders might develop during H2. You have already commented on July and August. The second related to that is, when do you expect the public sector tenders in Germany to translate into orders? I would assume that will be next year. We have already talked about the winter. I was a bit surprised that the cold had an impact in Q2, because everyone was probably looking at the heat towards the end of the quarter. My question is whether there has been an impact of hot weather in Q3, that we might be aware or should be aware of. The next question is related to CapEx.
We have seen CapEx going up. What is your CapEx expectation for the remainder of the year? Should we expect higher CapEx if the increase in orders related to the federal budget in Germany materializes next year or the year after? That is basically it from my side. Thank you.
Well, first, to the order intake. As you have been saying, we already won several contracts, especially in building construction, in Germany. I think, also from a qualitative side, it is very important that we have signed the contract for new soldier barracks worth EUR 270 million in Germany with the Deutsche Bundeswehr. You see that that is also part of the big bazooka of the big investments plan to come to the market, and that will save us stable revenues of EUR 90 million over the next three years. Besides that, we see industrial clients which are important as contracts there are high margin, but also in other building construction, about EUR 100 million that we already signed.
On the infrastructure side, we see now, as we have been saying and expected, that tenders are coming up and there are about EUR 1.5 billion new tenders in contracts where we are going to be taking part in the tenders for renovation of trains and so on. We think that public spend here is gaining momentum and they are coming up, and I think that is somehow a little bit the shift in the quarters before. We saw the big pipelines in the Eastern European countries, which are still there. Especially in Poland, also Romania coming up, we expect. We think that Germany now starts to kick in. We had a very good order intake in Austria so far as well. Taking that all together, we are optimistic for second half of 2026 for order intake.
Regarding the weather, I think if you remember, I think I was in Hamburg in April, and there was still snow there in the city. It was really remarkable, and at that time, building construction is usually at full speed, but had to be stopped. We had, unfortunately, some negative effect. Looking forward now during the summer, we got our first results also for July, and we see that we are totally online. We do not see a negative impact now. We see us developing along what we are guiding now. To the last question, CapEx. There is also some special effects we see in the development in the first half year. I think we have been pointing out that we have been acquiring a tunnel boring machine for the big contract in Poland. Therefore, we had an increase in equipment CapEx of EUR 20 million.
We have been acquiring rhtb: For intangibles intellectual property, we had CapEx here between EUR 15 million and EUR 20 million. If you take that off of our total investments of 172, then you get to a normalized, let me say, normalized figure of about EUR 130 million- EUR 135 million, which equals about 4.3% of our output. That means, also this figure is somehow influenced by special investments here. Going forward, we expect a normalized development, and that is where we are guiding CapEx in total for the year with about 4.5% of our output.
Thank you. Just to clarify, the October tenders might translate into orders already this year?
Actually, that's not what I said. It's not in our hand for the timeline when they finish. I think the important message from the quality side is that there are precise tenders now, and there are big projects in the size of EUR 200 million- EUR 300 million, which are very interesting for us, coming up on the market. I think that's the difference to the developments we saw so far.
Okay. Thank you.
Thank you very much. Before I take the next risen hand, a quick reminder on how the Q&A works. If you would like to ask your questions in person via audio line, please click on the raise hand button. If you're dialed in by phone, please press star key nine to raise your hand and star key six to unmute yourself. Of course, you're also welcome to post your questions in our chat. The next risen hand is from Stefan Scharff. I will allow you to unmute yourself now. You should be able to place your question.
Good afternoon, gentlemen. I have one question about the Austrian business. In Austria, the EBIT was more or less unchanged at EUR 43 million, and you mentioned in your half year report that there was EUR 1 million write-off. Otherwise, you could make the EBIT above the level from last year. Perhaps you can tell us what was the EUR 1 million write-off here in Austria?
Well, hello, Stefan. Both one-off effects that I explained before, the gain from the sale of the business premises of EUR 6.4 million in the JV. And the depreciation for the expected sale of the PWW Group both contribute to the Austrian segment, and the EUR 1 million is the difference between the EUR +6.4 million and the EUR -7.4 million. So that's actually the reason there.
Okay, I see. Coming to Germany, I could see that you could double your EBIT even with a lower level of revenues. What do you expect for Germany for the margin development in the second half of the year and also for 2027, 2028? Will we have the same good trend to continue?
Well, as we've been always saying, we expect Germany to develop. Last year we had a margin of 2.5% for the total year. I think we are on the right way. In the end, as you are questioning for the midterm future, we believe that we will be also able to deliver margins something about 3%+ in the upcoming years. I think it shows that we are on the right way.
Okay. Okay, great. If we come to the PORR LIVING, to the affordable housing projects, UBM called in the call today that there is the first pilot project to be launched or just started in Vienna. It is about 90 apartments. You have a volume in your mind, an output volume in your mind, let's say, for the next two or three years for the affordable housing segment in Germany and Austria?
We start our first project for PORR LIVING now close to Vienna with some apartments, and then together with UBM, the next one what you mentioned. But in line, we will really start our marketing and starting construction PORR LIVING in Austria. It will be more than EUR 100 million within this next year because we introduced this product to a lot of developers and a lot of companies of cities in Austria, Germany around, and they are just looking at the first project, how it really is, because we have done one project, but this is in a hall because not to show everybody what the model area is. So it is finished, but now we start our first project there is under. We have a film there and everything.
We have a lot of projects in the pipeline and a lot of cities, communities, and all the subsidized residences construction business is waiting to see how the first project is really starting. But it will be a lot. Other on one side, PORR for their clients, and together with UBM, we go on our own projects in Germany and Austria.
Yeah. There will be a big excess in demand. 1 million apartments missing in Germany, and I think a big number also in Austria. Another question is about Poland. Poland has seen a steep hike in revenues, more than 20%, also more than 20% in production output. But the EBIT was just up a little bit from EUR 11 million- EUR 11.5 million. Perhaps you can say a bit more here.
Well, I think we are now half of the year, and the EBIT margin is at 2.4%. I'm not really not worried about that. We see Poland developing along very good. We're pretty sure that at the end of the year, we will see a figure beyond 3% in the EBIT margin. Yeah, we're very happy with Poland. I think nothing to worry there.
Okay. Thank you.
Thank you, Stefan.
Thank you very much. There is a further risen hand from Markus Remis. I will ask you to unmute yourself, and you should be able to speak and ask your question.
Good afternoon. I hope you can hear me well. I would have a few more questions, please. I will have them one by one. Firstly, related to the EBIT guidance. When I look at what is implied for the second half, it gets me to around 7% output growth, talking now about the consensus expectations and 7% EBIT growth. Essentially, there is no margin expansion baked in your guidance, at least it seems from the numbers. Can you help us understand the assumptions you have made to arrive at this level?
Hello, Markus. Well, I think our forecast and expectation now showing total margin for the full year of 3.2%-3.3% is actually what we see now in our forecast. I think compared to the result last year and the conditions, I think that is a remarkable increase. Actually, we came out very good for the half year now based on the good management of our materials and purchased services. But for the full year, we expect that full rolling out of these positive effects can be a little bit challenging. I think totaling up the guidance is a good reflection of our development.
Okay. Thank you for that. Just a clarification on your leverage target. You said net debt free, but just to set it straight, does it mean that break even or around break even liquidity, or do you think you will end the year with a reasonable net cash position?
Well, Markus, you know that actually for a precise figure, we are depending on the payment behavior of public clients, especially in December. It is very hard at that point to give a precise forecast. As I said before, our target is to be net cash, including IFRS 16 liabilities. I think at that point of the year, we have no clearer visibility.
Okay. Can I then stay with the infra package in Germany, just to also clarify the remarks that you have made, this EUR 1.5 billion that you gave on the presentation. How would you say, is it possible for you to raise these projects to the famous infra bazooka, or is it just an, I would not say a coincidence, but is it an accumulation of orders that are now kicking in?
No, these are special projects that are for investments in train network and so on. They are actually exactly what the market has been waiting for. This EUR 1.5 billion, I think it is about six concrete projects that we will be running for.
Okay. Understood. On the PWW Group disposal, is that now fully adjusted? Is there also a meaningful deconsolidation effect when it comes to P&L in terms of output? Sorry if I was not quite clear. The question was actually if it is now fully-
All effects in the P&L from expected deconsolidation are included in that depreciation. There will be no further effect on P&L, and the output level is actually. It is a low double-digit million euro figure. It will not have a significant impact on our revenue side.
Okay, thank you. There are, again, a couple of related party transactions with UBM, and we saw that also already in 2025. I think if I did the math correct, it was now EUR 12 million in the first half. Can you elaborate on the strategic rationale? Because the companies that, where you bought stakes, it is more office building as far as I can see here, so not necessarily the living or residential angle that one would assume. What is the payback on these transactions, please?
Well, I think in general, the important part is that the hybrid capital for UBM, and I think as we signed that hybrid capital, we already said that UBM has always been a partner for PORR, a partner in development and distribution. Going forward, in general, there is a big pipeline. I think Stefan also referred to that. In former days, UBM was selling our office buildings and our hotels. Now I think market is developing towards this affordable housing there, which is for living in our house. That is the business rationale behind that decision. On a financial level, we get interest of 9% for the capital there, so I think it also pays off from a financial perspective.
The 9% return on the hybrid is fully understood, and that's, I guess, accretive on the group level. What is the payback that you get on the real estate transactions that you're doing, like Vienna office, Amsterdam office, Berlin office?
Well, actually, this is an office park where our head office in Poland is located in that park. Actually, it's concentrating the shares in the park in our hands. That's the rationale behind that. The transaction price in total was something about EUR 10 million in total of investment.
Okay. The hybrid capital, did I get it right that you included in the CapEx figure, this 4.5% of output?
No, we didn't. Actually, it's included in cash flow from investments and that's why I commented on the development of cash flow from investments, but it's not included in CapEx. What I said the one-off items in CapEx are the tunnel boring machine and the intellectual property intangibles that we have been acquiring from our rhtb: It is not the UBM hybrid capital.
Yeah, okay. Is it fair to assume that your remarks that you made recently that it would be a kind of CapEx output below 4% return to this level as of next year?
Well, for this year, I explained before that we expect 4.5%. We don't see that we need that level of 4.5% going forward. We think that our general development will be around 4%, which is the general guideline for us in the business.
Okay. Thank you. I will get back into the line.
Okay. Thank you, Markus.
Thank you very much. This is the last call for the questions, whether you would like to raise your hand or place them in the chat box. Since there seem to be no further questions, with this we come to the end of today's earnings call. Thank you very much for your interest and your dynamic participation of today's call. A big thank you also to Mr. Eiter for your presentation and your time. Should you have any further questions at a later date, please feel free to contact Isabella Steiner of Investor Relations. I wish you all a successful day and hand back over to you, Mr. Eiter, for your closing remarks.
Thank you very much for joining the conference for the half year results in 2026, and I hope to hear you healthy in the next call for our third quarter results in 2026. Thank you very much.