Monday, 24 February 2014 14:49

WBHO H1 diluted HEPS down 20.2% to 581.5c

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WBHO reports a 20.2% decline in diluted HEPS to 581.5c for the 6 months ended December 2013 from 729.0c a year ago.

Louwtjie Nel

The company said on Monday an unchanged interim dividend of 135c per share was declared.

Revenue increased by 11% to R13.4bn‚ about 6% of which related to the full consolidation of Capital Africa Steel in the period.

The building and civil engineering division achieved moderate growth‚ despite the effects of a three-week strike in August.

Revenue from the roads and earthworks division decreased in the absence of an anchor project in West Africa‚ which also hampered the division's profitability.

Revenue from the Australian businesses was static in dollar terms‚ but increased by R364m in rand terms following further currency weakness.

Operating profit before nontrading items decreased from R566m to R481m as a result of a loss of R36m from Capital Africa Steel (CAS) and the decrease in operating profit from the roads and earthworks division.

Consequently the overall operating margin decreased from 4.7% to 3.6%.

When excluding the performance of CAS‚ the operating margin increased to 4%‚ which was in line with the margin achieved at end June 2013.

Cash generated from operations amounted to R411m compared with R638m generated in the comparative period.

The group's order book at end December 2013 increased 16% to R25.3bn.

Looking ahead‚ the group said subdued mining activity was affecting both the civil engineering and roads and earthworks divisions‚ with no new significant awards in this sector since June 2013.

However‚ Exxaro was recently awarded the mining licence for its Mayoko mine in the Congo‚ for which WBHO remained the preferred contractor.

In Ghana‚ WBHO was pursuing opportunities in the mining sector as well further shopping centre prospects.

Locally‚ the strong building market in Gauteng continued to provide various opportunities in the short term‚ while the recent award of the new Nedbank offices in KwaZulu-Natal had filled the order book in that region.

In the Western Cape the V&A Waterfront continued to be a good source of projects.

In Australia‚ following the conversion of the Eastland shopping centre and South East Water projects to secured work‚ Probuild's order book had increased significantly‚ with good revenue visibility through to 2016.

Probuild was the preferred contractor for a further six contracts amounting to A$729m.

These projects were expected to start in the current financial year. The bid for the new Perth Stadium was submitted in December 2013 and the announcement of the preferred bidder was expected in March 2014.

The company said WBHO Civil had a strong book until the end of the financial year‚ but its future order book was affected by reduced mining spend in Australia.

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