Rough landing for Budimex in airport's terminal completion

Works on the project are due to be finished by stock-listed Budimex in April next year. However, although the project is worth some $200 (zł.647) million, to date the companies involved in the project, including Budimex, Ferrovial Agroman (Ferrovial group owns 60 percent of Budimex) and Estudio Lamela, have lost about zł.185 million, with Budimex now zł.68.5 million out of pocket.

The company has hit some major turbulence en route to its final descent for finishing the project in April. The Supreme Chamber of Control (NIK) had reservations about the tender, and Budimex rivals claimed that the company would have to pay for the contract.

Then in May Budimex's supervisory board expressed concerns of its own. Board member Ryszard Jach demanded a written notice about the project and a team was put together to investigate and present its findings in September. This never happened and Budimex instead announced it will convene a general shareholders' meeting on October 25 when it will discuss changes to the supervisory board, including the replacement of Ryszard Jach.

Budimex's CEO Marek Michałowski insists there is nothing wrong with the terminal contract. "It's being realized so it's hard to evaluate. I don't remember exactly how far the works are done. But I do not expect any disasters or big profits," he told Puls Biznesu. Budimex claims the volatile exchange rate is to blame for the financial shortfall.

"We signed an agreement in dollars but the exchange rate has dropped since that time. In 2002, when we signed the agreement, the dollar cost over zł.4, now it's nearly zł.1 less. The consortium will get zł.200 million less than we planned," said Marcin Węgłowski, chief financial officer at Budimex. Industry analysts were surprised that Budimex had overlooked the exchange-rate risk and some representatives said that the contract is to be renegotiated.

This comes as something of a surprise to PPL, the airport's operator, according to Puls Biznesu. "The dollar has fallen. The investor should understand that," Stanisław Pacuk, the chairman of the board said. "A clash? I've never heard of one. Renegotiating price? No way," Edyta Mikołajczyk, a PPL spokesperson, succinctly added.