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

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