This article is from the Australian Property Journal archive
LEIGHTON Holding shares fell 7.15% or $2.48 lower yesterday despite the company posting a solid $400 million profit after tax result for the nine months to March 31 2011.
The unaudited result reflects a 45% increase from $220 million recorded in the same period last year. This was achieved despite revenue decreasing to $13.3 billion from $13.7 billion. However, on an equivalent exchange rate basis to March 2009, the revenue would have been $790 million higher and also profit after tax would have been $27 million higher.
CEO Wal King said the result demonstrated the diversity of the group’s contracting and project development portfolio across its core markets of infrastructure, resources and property in Australia, Asia and the Middle East.
“These are strong results for the nine months which reflect solid performances in mining and infrastructure, offsetting the difficulties in property and the Middle East – particularly Dubai.
“Our diversification strategy has helped sustain the business through the worst of the global financial crisis and, after the residual GFC issues impacting property and the Middle East subside, we see the growth in our core markets continuing to strengthen,” King added.
Work in hand stood at $37.5 billion which was negatively impacted by $3.6 billion from exchange rate effects, up from $36.5 billion at the same time last year.
New contracts and variations awarded during the March quarter totalled $2.5 billion. Since March 2010, an additional $1.8 billion of work has been won and the group is in a preferred position on over $6 billion of projects which should be awarded in the next few months.
King said a sustained level of infrastructure spending over the next decade, particularly on transport, water, power and telecommunications projects, should continue to provide a good level of construction opportunities for the group’s Australian based operating companies.
“Asia is expected to continue to grow providing construction and mining opportunities in our core markets of Hong Kong, Indonesia, India and Mongolia.
“While Dubai is likely to remain subdued for some time, the other markets of the Middle East, underpinned by their oil and gas reserves, should continue to support a good level of construction work,” he predicted.
King expects to report full year revenue of around $18.5 billion and net profit after tax in excess of $600 million for the FY10.
Australian Property Journal
