Netherlands construction giant Royal Bam Group has announced losses of between €130-150m before tax in the first half of 2020, and will close Bam International due to the coronavirus pandemic.
Employing 600 people, Bam International was active outside of the firm’s European home markets, and will be disbanded due to a "lack of a positive outlook".
The international unit will complete its current order backlog, comprising 12 projects.
The group said Bam International failed to recover from a "substantial loss" in 2019, and the unit is due to report a €60m loss for the first half of 2020.
Contributing to the group’s difficulties was a €200m payout it made to settle the case of the Cologne municipal archives building collapse in 2009.
Bam’s insurance did not cover the whole €200m, and it recorded a charge of €40m.
The company said it remained healthy despite the losses, with a strong order book and cashflow increasing to €1.2bn from the first to second quarter of 2020.
Frans den Houter, Bam’s interim chief executive, said: "Our various markets have been impacted very differently by Covid-19. Some were shut down completely, while others remained open.
"We lost approximately 35% operational efficiency through the first two months of the crisis and are now getting back to 80%."
On the closure of Bam International, which had been under review, den Houter said: "This is harsh for the employees involved, however it is necessary and cannot be delayed." Â
He said it would result in a "significant improvement of our risk profile".
Image: The collapse of Cologne City Archives (Frank Domahs/http://www.domahs.de/CC BY-SA 3.0)Â Â