TGI operations contributed a total profit of € 2.3 million attributable to equity holders in 9M 2017 compared with € 2.0 million in 9M 2016.
Revenue increased to € 116.5 million in 9M 2017 compared to € 93.6 million in 9M 2016 as a result of ramp up of new projects as well as progress in the execution of existing projects.
The gross margin improved from 15.6% in Q3 2016 to 17.7% in Q3 2017 as a result of improved profitability of a significant project which reached an advanced stage in the execution during the quarter. The improved profitability in Q3 2017 partially compensated the impact of the initial high costs of the new agricultural project Quiminha in Angola (a long-term large scale agricultural project which commenced at the end of 2016) resulting in an overall decrease in gross margin from 15.3% in 9M 2016 to 14.1% in 9M 2017.
Kardan N.V. – Press Release – Q3 2017 Results – Page 8
The increase in income tax expenses (€ 3.7 million in 9M 2017 compared to € 2.7 million in 9M 2016) is mainly related to a tax provision recognized in Q3 2017 due to a tax assessment in respect of prior years.
Progress was made in the Star Pumped Storage project. The financial closing of the Project was completed in July 2017, after an agreement was signed for the sale of TGI’s 40.5% stake in Star Pumped Storage Ltd to Noy Fund in June 2017. In October 2017 all the conditions precedent to the finalization of the sale transaction were fulfilled. The completion of the transaction is expected within a few weeks.
In August 2017 TGI has signed, together with its 50% partner in the activities in Angola and Zambia, a USD 176 million contract for a multipurpose agricultural and water project in Zambia and three agricultural projects in Angola, totaling USD 291 million. According to these contracts, the companies that engaged in the execution of the projects will commence the works once (and if) the conditions precedent are fulfilled.
TGI expects that these new large agricultural projects would strengthen its international positioning in this sector.
In September 2017 TGI was awarded two Turn-key water infrastructure design-build projects in India. The two projects consist of survey and planning services, as well as the construction of water supply and treatment systems for approximately 50,000 households in the north of Nirsa in Jharkhand province and for approximately 77,000 households in the south of Nirsa for a total amount of approximately USD 76 million.
In November 2017 TGI was awarded another Turn-key water infrastructure design-build project in India. The project consists of the construction of water supply and treatment systems, water pumping stations and various operational facilities for approximately 85,000 households in the city of Nagercoil in the Tamil Nadu province, India, for a total amount of approximately USD 29 million.
In November 28, 2017 TGI was awarded its first water infrastructure project in Georgia for a total amount of approximately USD 26.3 million (€22.2 million). The project consists of the construction of sewerage systems in Poti, Georgia.
Upon fulfillment of conditions precedent, a pipeline of USD 598 million signed contracts will be added to the existing order backlog of USD 579 million as of September 30, 2017 (December 31 2016: USD 606 million).