Integrated report 2021

As of the 31^st of December 2021, the Budimex Group had cash and liquid deposits in the total amount of PLN 2,715,795 thousand, which is PLN 331,397 thousand more than a year earlier. The most important factors that influenced the development of financial resources included:

• continued high profitability of Budimex SA’s construction activities,
• proceeds from sale of shares in Budimex Nieruchomości Sp. z o.o. in the first half of 2021,
• payment by Budimex SA of a dividend in the course of 2021, i.e. a dividend from the profit for 2020 and an interim dividend from the profit generated in the first half of 2021 in the total amount of PLN 806,750 thousand,
• significant reduction of lease debt by Budimex SA and Budimex Kolejnictwo SA,
• an increase in cash in FBSerwis Group companies, mainly due to continued high profitability in the segment of waste collection and management.

In accordance with the Group’s policy, the Group’s cash surpluses were placed in bank deposits, in banks with high credit ratings. In addition, Budimex SA used surplus cash to finance its suppliers of services and materials, which had a positive impact on the liquidity of these suppliers and was important for them during the COVID-19 pandemic.

At the same time, the Budimex Group companies had external debt from credits, loans and other external sources of financing, including leasing. As at the end of 2021, it amounted to PLN 239,046 thousand, including PLN 108,497 thousand attributable to lease liabilities recognised in accordance with IFRS 16. Comparable to previous years, the amount of the Group’s external debt under bank loans, borrowings and lease understood in accordance with IAS 17, i.e. not including lease liabilities recognised in accordance with IFRS 16, amounted to PLN 130,549 thousand and was thus lower by PLN 1,923 thousand. This was PLN 123,943 thousand lower than as at 31 December 2020 and PLN 143,955 thousand lower than as at 31 December 2019. During 2021, the amount of the Group’s debt recognised under IFRS 16 also decreased, which was decisively influenced by the sale of shares and discontinuation of consolidation of Budimex Nieruchomości Sp. z o.o.

The amount of the Group’s financial debt includes: debt of Budimex SA, Budimex Kolejnictwo SA, Mostostal Kraków SA, and companies of the FBSerwis Group under leasing agreements (concluded to finance the acquisition of property, plant and equipment), debt of Budimex Parking Wrocław Sp. z o.o. under a loan for financing a concession project and a subordinated loan granted by a shareholder and debt of FBSerwis Kamieńsk Sp. z o.o. under a loan granted by NFOŚiGW for financing investments related to waste management. At the end of 2021, the Group had no debt due to bonds issued.

At the end of 2021, the ratios showing the sustainability of the capital structure improved, i.e. the equity coverage of assets increased and at the same time total debt and debt to equity decreased. This was possible due to a net increase in the Group’s equity despite high dividend payments by Budimex SA, as well as a decrease in the Group’s balance sheet total due to the sale of Budimex Nieruchomości Sp. z o.o.

Commitments from borrowings and other external sources of financing in PLN thousand

Sustainability of capital structure ratios

At the end of 2021, the liquidity ratios (both current and quick) were slightly higher than at the end of the previous years, i.e. at the end of 2020 and 2019. This was mainly due to an increase in the Group’s cash and a decrease in inventories, mainly related to property development activities. At the same time, the Group’s short-term liabilities decreased, which had a positive impact on the liquidity ratios.

Debt ratios