The construction contracts increased by 24.7% year-on-year

Prague - Construction companies closed 15,950 construction contracts in the first quarter worth a total of 55.9 billion crowns, representing a year-on-year increase of 24.7 percent. The Czech Statistical Office announced the results today. At the end of the first quarter, construction companies had contracted 17,500 contracts with a total value of 225.1 billion crowns.
"This is good news. The increase in the number of contracts closed will positively reflect in the growth of construction," responded Miloslav Mašek, the general director of the Union of Entrepreneurs in Construction. This year, production could increase more than last year when it rose by 4.2 percent year-on-year.
Construction companies increased their number of contracts for engineering structures, residential buildings, water management structures, and non-manufacturing non-residential buildings. The Czech Statistical Office only recorded a year-on-year decline in contracts for manufacturing non-residential buildings.
The Skanska CZ group, which is the largest domestic construction company, secured contracts worth 10.8 billion crowns in the first quarter. These include the construction of a section of the road ring road around Prague in the segment Vestec - Lahovice and another section of the D47 highway in the segment Hladké Životice - Bílovec. The company was also successful in obtaining contracts in Scandinavia, where it has newly signed a contract for the construction of a highway tunnel near Helsinki.
"The state and local governments, thanks to newly available European funds, are investing more in infrastructure, and the activities of developers with foreign ownership are also continuing," said Ondřej Šuch from Skanska CZ to ČTK.
For example, the company Metrostav closed a contract for the construction of the D47 highway in the section Lipník nad Bečvou - Bělotín, for a residential complex in Čakovice, the reconstruction and completion of the Prague office building City Tower, and the reconstruction of the Prague Faculty Hospital Motol. "Each of the contracts is worth more than 250 million crowns," said Metrostav spokesman František Polák to ČTK.
According to statisticians, the average value of newly closed construction contracts in the country was 3.5 million crowns. For public contracts, it was seven million and for private contracts, two million crowns. The average value was year-on-year higher by 19.4 percent. Of the total value of newly closed contracts, public contracts amounted to 32.9 billion crowns, representing a share of nearly 60 percent. Private contracts were valued at 23 billion crowns. In terms of the number of contracts, however, private contracts predominated, accounting for 70.6 percent of the total of 15,950 newly closed contracts.
Statisticians observed a direct correlation between the size of the construction contract value and the size of the construction company. "Large construction contracts are carried out primarily by construction companies that can ensure the relevant construction comprehensively at the designated technological level," stated the Czech Statistical Office. In companies with a thousand or more employees, the average contract value is 70.4 million crowns, while for companies with 500 to 999 workers, it is 39.5 million crowns.
Of the total number of 17,100 closed contracts, 94.7 percent will be realized within one year, which is similar to 2005. According to the Czech Statistical Office, this indicator has long been above 90 percent. In value terms, 75.1 percent of the total volume of 213.9 billion crowns will be realized within one year, which represents a year-on-year increase of 5.4 percentage points.
Within six months, 77.7 percent of all contracts closed by the end of the first quarter of 2006 will be realized, corresponding to 47.7 percent of the total value.
In the entire previous year, construction companies closed 93,602 new contracts, representing a year-on-year increase of 8.9 percent. However, their total value fell by 10.1 percent compared to the previous year to 248.8 billion crowns.