Under the influence of the absence of significant investments, both from the private and public sectors, the business results of domestic construction companies fell again last year.
Along with expected losses, analysts were surprised by double-digit declines in revenue, while some companies saw their revenues halved. This reflects the state of the domestic construction industry, whose two largest representatives, Split’s Konstruktor and Zagreb’s Dalekovod, are in serious trouble. Konstruktor is on the path to bankruptcy, while Dalekovod has initiated a pre-bankruptcy settlement to restructure its debts. Although a significant turnaround is not yet in sight, it could be said that those construction companies that survive this year will profit next year. Among other things, construction is an extremely cyclical activity whose growth or decline is tied to the movement of the entire economy, which should begin to rise by the end of this year. Most construction companies are also facing liquidity issues and a lack of capital, so through cost rationalization and balance sheet restructuring, better starting positions for 2014 will be created.
