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JOHANNESBURG - Construction, engineering and mining services group Aveng is pleased with its fifth consecutive profitable financial report to shareholders.

They said it was more than quadrupled its earnings in its half-year to end-December, while it remains on track to extinguish its legacy SA debt. Headline earnings jumped about 353 per cent to R77 million in the company’s half-year, with revenue growing 16 per cent to R15 billion, once again boosted by healthy market conditions in Australia, where all levels of government are pursuing economic growth through infrastructure investment.

Valued

Aveng is valued at R1.59 billion on the JSE, and its core businesses are Australian construction firm McConnell Dowell and mining services Moolmans, the latter which is focused on Africa. McConnell Dowell contributed three quarters of revenue to end-December, and Moolmans 10 per cent.

McConnell Dowell grew its revenue 16 per cent, amid an ‘excellent’ performance in Australia, as well as an above planned performance in New Zealand and the Pacific Islands, but offset somewhat by underperformance in Southeast Asia. Moolman’s revenue fell more than a quarter, however, due to the completion of a contract for a gold miner in Guinea, as well as reduced scope of work at zinc operation in the Northern Cape.

The group, however, said it has increased its work in hand to R53.3 billion as of the end of January, from R30.8 billion at the end of June, and remains on track to extinguish its SA legacy debt, having inked about a R1 billion including net cash - deal to sell Trident Steel business in 2022.

Aveng is one of the few survivors of a downturn in SA’s construction industry that followed the controversial 2010 Soccer World Cup, but it has battled with debt, and in recent years has moved to sell off non-core business, including its roads, water and rail units.

CEO Sean Flanagan said in a statement the group was on track to settle the remaining R353 million in remaining legacy SA debt, which at its height in 2018, amounted to R3.3 billion. “Notably, this is our fifth consecutive profitable period in our journey from a loss-making, over-geared business that was underinvested in equipment...,” he said. In morning trade, Aveng’s shares were up 2.05 per cent to R12.96, but have lost about 95 per cent over the past five years.