FOUR-PAGE COMMERCIAL PROPERTY GUIDE
Cimic project pipeline clocks in above $34bn
DEVELOPMENT titan Cimic has engineered a stellar first quarter, increasing its net profit to $172 million on revenue of $3.2 billion.
The group, formerly known as Leighton, now has a pipeline of projects worth $34.6 billion — equivalent to more than two years of revenue.
Releasing a trading update yesterday, Cimic said its firstquarter net profit was up 7 per cent from the same period a year earlier. The group says it still expects a full-year profit of $720 million to $780 million “subject to market conditions”.
Some analysts suggest the market conditions could include any fallout of a potential trade war between China and the US. For now, though, the group is riding the wave of key infrastructure projects around Australia, which include the West Gate Tunnel and the Sydney Metro.
The company has also gone on a spree, signing up several new projects in the first three months of the year.
Marcelino Fernandez Verdes, the executive chairman of the Spanish-owned group, said its positive momentum last year had continued in the first quarter this year.
“This highlights the strength of our global business. We have increased revenue and cash-backed profit, and maintain a positive outlook,” Mr Fernandez Verdes said.
“Our balance sheet remains strong, and we continue to consider ways to use our capi- tal that will create long-term value in the best interests of our shareholders.
“This includes taking advantage of growth opportunit- ies, both organic and strategic, that leverage or expand our existing competencies, including investing in public private partnerships.”
Chief executive Michael Wright, said Cimic continued being disciplined in managing its costs in the first quarter.
“Our work in hand remains at a high level, providing assurance of future revenues, and the pipeline of opportunities for our business is strong,” he said.
Among the major wins Cimic has announced so far this year is a $150 million deal to provide asset management and project services for Australian BP fuel terminals.
Other wins include the building and maintenance of the Tailem Bend Solar Farm in South Australia, which is expected to generate $170 million, $1.2 billion of revenuegenerating mining services in Australia, and continued maintenance of the Royal Australian Navy’s Anzac-class frigates, worth $250 million.
Cimic shares closed up 0.5 per cent yesterday at $43.96.
Cimic executive chairman Marcelino Fernandez Verdes