Integrated report 2021

The main revenue items from activities included in the systematics in 2021 were:

Capital expenditures were incurred primarily for:

Budimex Group discloses for the first time in this report information on the so-called EU Taxonomy of Environmentally Sustainable Activities. The obligations related to this were introduced by Regulation (EU) 202/852 of the Parliament and of the Council of the 18th of June 2020. In the first year of operation, in accordance with the content of Commission Delegated Regulation (EU) 2021/2178, Budimex Group discloses the percentage of turnover, capital expenditures and operating expenditures qualifying for the systematics (Taxonomy), without the need to verify the Technical Qualification Criteria, i.e. to determine what percentage of these three values is related to with environmentally sustainable activites.

Accounting principles

The following rules have been applied to calculate the percentage of turnover, capital expenditure (CapEx) and operating expenditure (OpEx) eligible for systematics:

Turnover

For turnover, the basis was the Group’s total consolidated revenue in 2021 as disclosed in the consolidated financial statements in the consolidated income statement under “Net revenue from sales of products and services and goods and materials”. Revenues from qualifying systematic activities were assigned to the numerator.

Capital expenditure (CapEx)

For the capital expenditures (CapEx), the basis was the capital expenditures incurred in all Group companies that were reported in the consolidated statement of cash flows within investing activities under “Acquisition of intangible assets and property, plant and equipment”. The numerator was attributed to that part of CapEx that relates to activities that qualify for systemisation. For capital expenditure on construction vehicles, equipment and machinery, the proportionate allocation method has been applied. The Group uses construction vehicles, equipment and machinery that are used in the performance of various contracts, both related to systematic eligible and non-eligible activities; in addition, the same machine may be used at different times of the year on different contracts. The total capital expenditure on construction vehicles, equipment and machinery was therefore allocated to the various activities in a proportion corresponding to the proportion of revenue from the contracts concerned. The above does not apply to capital expenditure in the company FBSerwis, where the allocation of CapEx was made directly.

Operating expenditure (OpEx)

For operating expenses (OpEx), the basis was all costs used to operate the Group’s assets on a day-to-day basis and keep them in proper working order. The numerator was allocated the portion of OpEx that relates to activities that qualify for systemisation. For operating expenses for construction equipment and machinery, the proportional allocation method was applied in the same way as in the CapEx case described above. For operating expenses relating to vehicles and machinery used in the FBSerwis segment, the allocation of OpEx was made directly.

For operating expenses, which are defined in the Commission Delegated Regulation (EU) 2021/2178 in a way that does not refer to International Financial Reporting Standards, all accounts in the Group’s accounting system were reviewed and then the identified items meeting the definition of OpEx related to the maintenance of construction vehicles, equipment and machinery in good condition were allocated on a pro-rata basis and items related to vehicles and machinery used for waste management were allocated directly to the relevant activity. Operating expenses are cost items in the income statement, unlike capital expenditure, which is an increase in the balance of tangible and intangible assets, and therefore the values included in the CapEx and OpEx calculations are separate.

The Group discloses in this report for the first time the share of activities that qualify for systematic in respect of the reported period, i.e. 01.01.2021-31.12.2021, so the disclosure does not include information on changes in data for previous periods.

Due to the fact that in the first year of reporting only the percentage of turnover, capital expenditures and operating expenditures that qualify for the systematics are disclosed (and not those that comply or do not comply with the systematics), activities contributing to more than one environmental objective were not identified. Consequently, there was no need for special procedures to avoid double counting.

Furthermore, no disaggregation of key performance indicators was made between the Group’s individual operating units. At the same time, the Group identifies the need for such disaggregation in the following year, when the fulfilment of the Technical Qualification Criteria will be verified.

Turnover

Table 1: Percentage of turnover eligible for systematics

The Group generates revenue from several business segments, most of which are included in the systematics in terms of Attachment I and II of the Delegated Climate Act (Commission Delegated Regulation (EU) 2021/2139). The main revenue items from activities included in the systematics in 2021 were:

• Revenues from the execution of contracts in the field of transport infrastructure construction in the amount of PLN 4,434 million, concerning the construction of infrastructure supporting low-emission road transport and public transport (PLN 2,316 million), infrastructure for railway transport (PLN 1,973 million) and infrastructure supporting low-emission water transport (PLN 144 million).
• Revenues from the execution of contracts for the construction of new buildings amounting to PLN 1,364 million.
• Revenues related to the construction of water collection, treatment and purification facilities amounting to PLN 190 million and sewage collection and treatment facilities of PLN 18 million.
• Revenue of the Group’s waste management segment amounting to PLN 663 million.

In addition, the Group generated revenues in 2021 from the geration of electricity from wind energy (PLN 4 million) and from the installation of equipment to increase the energy efficiency of buildings (PLN 1 million)

The percentage of turnover eligible for systematics in total turnover was 84,4% in 2021.

Capital expenditure (CapEx)

Table 2: Percentage of capital expenditure (CapEx) eligible for systematics

Capital expenditure (CapEx) eligible for systematics is related to the implementation of investment plans approved by the Board.

Capital expenditures were incurred primarily for:

• Expenditure on machinery park, including vehicles, equipment and construction machinery of PLN 64 million.
• Expenditure on vehicles and machinery used in the waste management segment in the amount of PLN 41 million.

The share of capital expenditures eligible for systematics in total capital expenditures was in 2021 was 93.4%.

Operating expenditure (OpEx)

Table 3: Percentage of operational expenditure (OpEx) eligible for systematics

In the case of operating expenses (OpEx), the largest amount (PLN 37 million) was related to repairs and maintenance of construction vehicles, equipment and machines. In turn, operating expenses of PLN 26 million were incurred on repair and maintenance of waste management vehicles and machines.

The share of operating expenditure eligible for systematics in total operating expenditure was 86.6% in 2021.