CEO OF ELLAKTOR GROUP
Greece 2020 I Economy I Interview
BIOGRAPHY He is one of the founders and main shareholders of Ellaktor S.A., being an active member of the construction industry in Greece since 1976. He also served on the executive committee of the Hellenic Federation of Enterprises since 2005 and had been Chairman of the Hellenic Association of Independent Power Producers since its establishment and until 2018.
“ELLAKTOR, HAS RECENTLY SUCCEEDED IN ISSUING THE LARGEST HIGH-YIELD BOND BY A GREEK COMPANY SINCE THE FINANCIAL CRISIS, SECURING THE TARGETED €600 MILLION.”
CAN YOU GIVE US AN OVERVIEW OF THE GROUP'S ACHIEVEMENTS IN 2019?
2019 was a very productive year for ELLAKTOR, focused on the Group transformation process. Over the past year, we have been working around the clock in order to reshape ELLAKTOR and ensure that it has all the means necessary in order to be transformed into a modern, efficient, well-governed and profitable Group. During the previous year, we have also seen the first encouraging signs that our new strategy to further focus on our growth engines -- concessions, renewables and the environment -- and use Construction as an enabler which provides ELLAKTOR with a competitive advantage in the aforementioned segments, is working.
Concessions have had a very good year and the increase in traffic in almost all our motorways, has led to significant profitability. We are very keen to kick-off the Alimos Marina project and demonstrate how our Group can develop more added-value concessions projects, combining its construction, real estate and concessions expertise. Regarding Renewables, our faith in the prospects of this segment and the benefits deriving from the absorption of our until recently listed subsidiary into ELLAKTOR, became also very evident within 2019. As our investment plan proceeds and our installed capacity increases, we are experiencing significantly increased and predictable profitability. Most of the projects included in our 284 MW investment plan are already constructed and our Group’s installed capacity will reach 579 MW in 2020, further benefiting ELLAKTOR’s financial strength.
"I BELIEVE THAT GREECE HAS GREAT PROSPECTS
BUT THAT WE MUST MOVE FORWARD AS FAST
AS WE CAN TO RECOVER THE OPPORTUNITIES LOST
TO THE LONG-LASTING ECONOMIC CRISIS."
In the Environment segment, although profitability has been affected by a series of factors mainly related to decreased feedstock volumes and depreciations of technical equipment, we remain focused on the prospects arising from the Greek State with regards to waste management policies. In relation to Construction, we continue to push forward with a series of initiatives and reforms in order for AKTOR to return to profitability, such as the introduction of a new organizational chart, aiming at enhancing operating efficiency, cost-control and visibility throughout AKTOR’s projects and geographies. Additionally, lately a series of developments in the construction sector in Greece have allowed the market to be slightly optimistic regarding its prospects. For example, the fact that Line 4 of Athens Metro has been green-lighted by the Council of State, allowing for the only mature public works tender with a budget of €1.5 billion to proceed was a huge breakthrough, as AKTOR, as part of a JV, is now one of the two remaining contenders in the tender.
WHAT IS YOUR PERSPECTIVE ON GREECE'S ECONOMIC FUTURE?
I believe that Greece has great prospects but that we must move forward as fast as we can to recover the opportunities lost to the long-lasting economic crisis. We are moving in the right direction, but there are still many steps to be taken so that we can exploit the full potential of our country. It seems that the Government is prepared and willing to act strategically so as to improve the bigger picture in the Greek economy and investors’ view of our country’s potential. We are much more extrovert if compared to previous years, meeting with investors and participating in roadshows. We see that hedge funds are more active than before and there is definitely more interest from long-term investors. Some of our historical investors that had strong participation in our company in the late 2000s and had left the country during the crisis, have now returned looking for opportunities.
ELLAKTOR, has recently succeeded in issuing the largest high-yield bond by a Greek company since the financial crisis, securing the targeted €600 million. We are even more encouraged by the fact that 75% of the funds was provided by more than 100 international investors, securing real and direct access to the global market. Our experience has shown that there is significant availability of funds at the moment, but not for any Greek company. Our direct communication with foreign investors has shown that investors seek strong corporate governance, strict compliance, credible reporting and reputable auditors, along with solid financials, realistic business plans and growth prospects. There are good opportunities for infrastructure investments in several segments – energy, renewables, waste, concessions and construction to some extent. Greek multinationals which have survived and emerged stronger from the financial crisis by adapting to the requirements of doing business in the current international environment, can be an invaluable partner to a foreign investor entering Greece and a catalyst for the transformation of overall business environment in the country.