Bouygues appoints 2 deputy chiefs

Bouygues appoints 2 deputy chiefs©Reuters

Martin Bouygues

Bouygues has appointed two deputy chief executives, setting in motion longer term plans for a change of guard at the French construction-to-telecoms conglomerate led by industrialist Martin Bouygues.

The group said on Wednesday that Olivier Roussat, who heads the group’s Bouygues Telecom unit, and Philippe Marien, chief financial officer, had been appointed deputy chief executives.

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In their new roles, the two executives will join existing deputy chief executive Olivier Bouygues, Martin’s brother, who has occupied his role since 2002.

In a statement, the group said the managerial change had come “on a proposal from Martin Bouygues”, and the appointments would assist the French industrialist in his duties.

However, the move is widely seen as yet another step in Mr Bouygues’s longer term succession plan. It follows the decision in March to appoint two younger family members — Edward Bouygues, Mr Bouygues’ son, and Cyril, his nephew, to the group’s board.

Mr Bouygues, whose SCDM family holding controls just over 20 per cent of group shares but more than a quarter of all voting rights, will see his mandate as a board member expire in 2018 — though he could seek re-election and has made no official plans to retire.

The latest changes come as the conglomerate, which also owns TF1, France’s largest private broadcaster, reported operating profit during the second quarter of the year of €346m — €33m higher than a year earlier.

That performance was 9.1 per cent ahead of consensus forecasts and helped push Bouygues shares 3 per cent higher Wednesday morning to €28.98.

Group revenues during the second quarter were €8.14bn, 3 per cent lower than a year earlier and 1.7 per cent below analysts’ expectations.

The group maintained its outlook for 2016, saying it expected profitability in its construction business to improve thanks to growth in French and international markets.

It also said that Bouygues Telecom, which has been battered in recent years by a ferocious price war in the country’s telecoms sector, confirmed its return to long-term sales and earnings growth.

It added that the unit would maintain its 2017 target of achieving a 25 per cent margin in earnings before interest, tax, depreciation and amortisation (ebitda) after unveiling a plan to save at least €400m this year compared with the end of 2013.

The telecoms unit said it added 303,000 mobile customers during the second quarter, bringing total mobile subscribers to 12.4m by the end of June.

Sales at the unit reached €2.29bn during the first six months of 2016, 6 per cent higher than during the same period a year earlier. Ebitda during the period was €408m, 26 per cent higher than a year earlier. Margins were 20.7 per cent, 3.6 percentage points higher than during the first six months of 2015.

In a research note, Jerry Dellis of Jefferies, said the unit “looks on course to deliver (and possibly exceed) its reiterated 2017 margin target”.

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Bouygues appoints 2 deputy chiefs
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