M&R disposes of non-strategic assets

MURRAY & Roberts (M&R) has decided to dispose of its infrastructure and building businesses and Genrec, which provides engineering services for the structural steel industry.

M&R’s chief executive, Henry Laas, yesterday confirmed that negotiations with prospective buyers for these non-strategic assets were already at an advanced stage.

The announcement about the disposals coincided with M&R reporting a 10 percent decrease in headline earnings a share to 175c in the year to June from 195c in the previous year.

Laas said: “The proposed transaction is in the best interests of the long-term sustainability of both the group and the infrastructure and building businesses.”

He added that it was the group’s vision to be a leading multinational by next year.

In the year to June, the operating profit of the infrastructure and building business slumped by 84 percent to R7 mil- lion from R43m in previous year.

Laas said the board decided to dispose of Genrec, the only remaining manufacturing business in its portfolio of businesses. Genrec slumped to an operating loss of R108m in the year to June from the R18m profit in the previous year.

M&R reported a 9 percent increase in revenue from continuing operations to R26.1 billion from R24bn despite the decline in headline earnings per share.

Reduced dividend

Profit before interest and tax rose by 21 percent to R1.2bn R996m. A reduced dividend a share of 45c was declared compared to 50c in the prior year.

The order book decreased by 13 percent to R33.4bn from R38.3bn.

Laas said the difficult macro economic conditions were expected to persist and the group expected a year-on-year decline in operational earnings in its 2017 financial year.

M&R shares fell 2.17 percent yesterday to close at R14.40.