Bouygues profit tops estimates, returns to pre-pandemic levels (updated)

COLAS SA

16/11/2021 09:23

* Beats sales, core profit forecasts
    * Confirms full-year outlook
    * CEO "rather confident" on TF1/M6 merger

 (Adds details from call, analysts' comments)
    Nov 16 (Reuters) - France's Bouygues  BOUY.PA  reported on
Tuesday nine-month core profit that beat forecasts, lifted by a
strong performance in its broadcast business TF1  TFFP.PA  and
construction arm Colas  COLP.PA  and customer gains in its
telecom division.
    The Paris-based group posted a current operating profit of
1.14 billion euros ($1.3 billion), just above analysts' 1.13
billion estimate and rising above pre-pandemic levels.
    For the same period last year, Bouygues posted a core profit
of just 681 million euros.
    Its construction businesses benefited from major road
contracts in Canada and Madagascar, while Bouygues Telecom added
mobile and broadband customers, boosting sales.
    The group, which is planning a merger of TF1 with its rival
M6  MMTP.PA , reported gains in audience market share in key age
brackets as well as strong demand for TV advertising.
    Chief Executive Oliver Roussat told reporters he was "rather
confident" the French regulator would approve the tie-up when it
rules next October, the decision hanging in part on the nature
of the markets retained by the joint group.
    The planned merger would combine France's two biggest
private broadcasters and see the joint entity control
three-quarters of the country's TV advertising market.
 urn:newsml:reuters.com:*:nL2N2N50FV
    
    EXPLODING COSTS
    Analysts noted the "small" beats to consensus forecasts, but
the group's net profit was slightly below estimates as it
accounted for costs of operations such as its planned
acquisition of Equans.
    Bouygues earlier in November agreed to buy the services arm
of energy group Engie  ENGIE.PA  in a deal that would be its
largest ever acquisition and would make its new Energies &
Services segment its largest business division.  urn:newsml:reuters.com:*:nL1N2RX06D
    Roussat said the company had also faced spiralling raw
materials costs, from steel prices to freight from China.
    "Costs for journeys have literally exploded," he said. "In
some cases the costs have gone up eight or nine-fold."
    However, Roussat said Bouygues was able to soften the blow
by passing on costs on its short-term contracts, while some
longer-term deals included provisions for inflation.
    
    ($1 = 0.8790 euros)

 (Reporting by Juliette Portala and Sarah Morland ; Editing by
Sherry Jacob-Phillips)
 ((juliette.portala@tr.com ; +48 58 769 66 07))