Spain’s FCC quadruples losses in government-less 2016

Construction giant FCC said Monday its losses almost quadrupled in 2016 due to a lack of public procurement in Spain, which went 10 months without a government.

FCC said in a statement that it booked a net loss of 165 million euros ($177 million) last year, compared with a loss of 46 million euros ($49 million) a year earlier.

The group — majority-owned by Mexican billionaire Carlos Slim — said revenues declined by eight percent to 5.9 billion euros, impacted by the “continued fall in demand in Spain’s construction sector due to the persistent contraction in investment demand in public works.”

Spain was left without a fully-functioning government for 10 months last year as rival parties were unable to come to any coalition deal following two inconclusive elections.

During that time, and until conservative Prime Minister Mariano Rajoy took power again at the end of October at the head of a minority government, public procurement was all-but frozen.

As such, FCC’s cement division registered a loss of close to 178 million euros and its construction branch saw a loss of around 66 million euros.

By contrast, its waste management and water treatment divisions recorded profits of 88 million and 76 million euros respectively.

The group’s order book, meanwhile, contracted by nearly six percent.

FCC suffered hugely during Spain’s economic crisis, sparked when a property bubble burst in 2008.

But it was able to reduce its debt considerably in 2016, down 34 percent to 3.6 billion euros.

The group employs 55,000 people in 25 countries.

It turned to international markets during the Spanish crisis, which saw the construction sector paralysed, and now makes nearly half of its turnover abroad.

emi/mbx/spm