Bouygues Aims to Grow in 2023; Plans More Selective Approach for Equans

Bouygues EN reported its full-year results, with sales up 4% organically at constant exchange rates and up 8% excluding the acquisition of Equans, which was closed in October 2022. Bouygues’ backlog remained flattish year over year at EUR 33.7 billion. Colas, which saw a rocky start of the year due to higher energy and commodity costs and a lag to pass price increases to customers, recovered in the second half of the year, and management met its revised guidance of increasing profits at the divisional level. Bouygues’ guidance for 2023 was conservative and slightly vague, aiming for flattish sales and “an increase” in operating profit, given the uncertain macroeconomic environment. We are maintaining our EUR 35 fair value estimate, with the shares offering little upside at this point.

Bouygues also released its long-term plan for Equans, which intends to grow operating margins from 2.2% in 2022 to 5% in 2025 by being more selective on the projects it chooses. In the telecom business, sales grew 4% organically for the full year with EBITDA after leases (EBITDAaL) expanding by 150 basis points to 30.4% due to revenue growth and cost controls. TF1′s, Bouygues media division, grew sales by 3% organically. Bouygues expects to pay a EUR 1.80 dividend per share for 2022, stable compared with last year.