Porr may leave Hungary

Porr AG chairman Karl-Heinz Strauss has said the construction firm may stop operating in Hungary.The Hungarian government has criticised the quality of a motorway recently built by the Viennese company. Strauss pointed out today (Tues) that the problems were “of political nature”.The businessman said: “We may have to withdraw from Hungary. I think (the situation in the country) is critical.”The Porr chief’s statements come on the heels of criticism of Hungary’s new taxation structure which burdens international firms doing business in the country with higher fees. Various Austrian companies such as BauMax and Spar Austria are affected by the controversial decree.Strauss also explained that Porr may reduce its activities in Slovakia if the number of orders does not rise in the near future. Strauss said he was most optimistic about developments in Germany, Switzerland, Poland and the Czech Republic.The Porr boss also said the situation in Austria was good. “Our order books for this year are full,” he stressed. Strauss however added: “There’s no growth in the Austrian construction sector.Only last week, the Institute for Economic Research (WIFO) said it expected investments in the Austrian construction industry to edge up by only 0.7 per cent this year compared to 2010. The Viennese think tank underlined that the Austrian gross domestic product (GDP) may rise by 2.2 per cent at the same time.Porr is the number three in the Austrian building sector behind Viennese rival Strabag SE and Salzburg-based Alpine Bau. Porr has around 11,500 employees. It achieved earnings before interest and taxes (Ebit) of 6.9 million Euros in the first six months of 2010 after 7.2 million Euros in the same time span of 2009. Porr’s turnover declined from 1.107 billion to 955 million Euros at the same time.Porr decided to withdraw from Libya due to the unrest in the North African country earlier this month.The Austrian company and its partners, the Turkish Renaissance Group and the Libyan Investment Development Company, were contracted to build a 10,000-seater football stadium in the Libyan capital Tripoli only last November. The stadium would have been one of the venues of the 2013 African Cup of Nations.Strauss said Porr and Renaissance Group lost an overall 1.5 million Euros by abandoning all activities in Libya. It is uncertain whether the Viennese construction firm – which was previously headed by Siemens Austria boss Wolfgang Hesoun – will return to the country. Strauss recently identified Qatar and Turkmenistan as potential future markets for Porr.