* New CEO Blades says company can leverage heritage to grow
* Says break-up is not an issue
* Shares rise to eight-month high on buyback, dividend
By Georgina Prodhan
MANNHEIM, Germany, Feb 14 Bilfinger's
new chief executive has set out the latest attempt to revive the
German industrial firm's failing fortunes, consolidating what
remains of the group into a new structure and promising to
rekindle a sense of pride.
Tom Blades, Bilfinger's fourth CEO in six years, on Tuesday
outlined a vision of a company that could build on more than a
century of engineering expertise to grow again, after years of
battering by a collapse in its markets and poor management.
Bilfinger, once a leading name in German construction,
became notorious for issuing six profit warnings in the space of
two years before Blades's arrival in July 2016. One CEO after
another sold off some of the company's crown jewels.
The group is left with the design, construction and
servicing of industrial plants - a difficult business in an
environment of volatile raw-materials prices - and some
activities catering to power utilities.
"We have tasks ahead of us," Blades told a news conference
on Tuesday at the company's headquarters in Mannheim before a
meeting with analysts. "It's not rocket science, it's simply
doing what we're good at and doing it every day."
His comments came after Bilfinger late on Monday announced
new mid-term targets, a surprise share buyback and an
unexpectedly high dividend, lifting its shares which closed up
3.9 percent after hitting an eight-month high.
Blades, a 61-year-old Briton who is an engineer by training
and former manager at industrial gases group Linde,
said he had the backing of activist investor Cevian, which holds
26 percent of its stock, for his strategy to build up the group.
He plans to simplify its structure into one arm focusing on
engineering and technology and another on after-sales service.
Blades was recruited by Cevian partner Eckhard Cordes, now
"A break-up was never an issue for me. I never talked to the
supervisory board about it," Blades said. "If that had been the
case, they would have installed an accountant or a lawyer, not
Cevian declined to comment.
Bilfinger sold its construction business in 2014 under
then-CEO Roland Koch, a former politician who tried to focus the
group on higher-margin service activities. It sold its
real-estate services operations, its most profitable business,
Analysts said Blades and his team had time to prove
themselves, although the company had a long road ahead.
"The new management is slowly starting to win the confidence
of the market," Metzler Bank analyst Jasko Terzic said.
"Blades's technical knowledge and understanding of how the
business works is impressive. But it's still very early days."
(Editing by Maria Sheahan and David Holmes)