1. v s .
Petr Michálek
Skanska CS a.s.
April 15, 2009
Euro vs. Koruna

2. PROS AND CONS OF CONTINUING CZK
Construction is a local business.
Export is limited.
Overwhelming majority of revenues comes from the local market.
Foreign competitors afraid of FX risk do not compete in local tenders so
often.
…but there are significant FX risks
Some key materials or spec. machinery are bought in other EU countries
More and more investors use EUR financing and try to transfer FX risk to
construction companies.
Significant connection of Czech and Slovak construction market.
Hedging is not salvation.
April 15, 2009
Euro vs. Koruna

3. PROS AND CONS OF EURO ADOPTION
FX risk for construction companies limited almost to zero.
More investors from EU countries could enter the market. No FX threat.
Good experience from the process of EURO adoption in Slovakia.
Smoother cooperation between Czech and Slovak constr. market.
Easier reporting, market comparison etc.
…but we have to have in mind
Costs connected with EURO adoption, mainly in software modifications.
Market will be more accessible for more foreign competitors.
? Public investment related to fulfilment of Maastricht criteria ?
April 15, 2009
Euro vs. Koruna

4. SUMMARY
It is not a key issue for construction sector if there is EURO or CZK as a domestic currency.
But it is clear that EURO adoption will bring more benefits to the sector than staying with CZK.
April 15, 2009
Euro vs. Koruna