Hidroconstructia, one of the largest construction companies in Romania, saw its turnover surge 142.8% in the first seven months of the year against the same time in 2004 to reach 63.7 million euros (221 million RON).
The main reason for the growth was increased demand for reconstruction works for dams and infrastructure in the areas severely affected by the heavy flooding this summer.
"The growth came thanks to the contracts we signed in the first half of this year, most of which were for rehabilitation works on the dams in the flooded areas," Emil Timofti, the general manager of Hidroconstructia, told Ziarul Financiar. Most of the contracts for consolidation and rehabilitation of dams are for works in Moldova, the region most affected by the floods.
The floods also meant strong growth on the construction supplies segment, which saw the chairman of the employers'' association for this industry announce recently that companies in the sector had experienced trouble keeping up with demand.
"We expect 144 million euros (500 million RON) in turnover by the end of the year," Timofti said, forecasting an 8% increase on last year, when the company turned over 132.6 million euros (461.1 million RON).
Hidroconstructia officials also signed a contract to rehabilitate the sewerage network in Craiova for 25.6 million euros funded by ISPA.
Hidroconstructia was established in 1950 as a company specialised in hydro-related construction projects. Turnover at the company increased continually until 2002, when it hit a record high of 121.6 million euros.
Hidroconstructia''s business then started to decline, which saw the company attempt to regain stability by tapping into other segments of the constructions market.
One such segment is the highway building business, which is estimated at around 7bn euros over the coming years. Hidroconstructia became a subcontractor for US company Bechtel, the general contractor for the Brasov-Bors Transylvanian highway, a project worth approximately 2.4bn euros.
Works on the highway are currently on hold, after the Romanian authorities asked to renegotiate the deal with the American party. Both Hidroconstructia and other Romanian companies in this project have been affected by the halt to the works for the highway, which is one of the largest infrastructure projects seen on the Romanian market over last few years.
The Transylvanian branch of Hidroconstructia estimates it has lost approximately 2.5 million euros this year due to suspension of the three contracts it signed with Bechtel for the highway.
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