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MURRAY & ROBERTS HOLDINGS LIMITED
56th ANNUAL GENERAL MEETING 27 OCTOBER 2004
BUSINESS UPDATE
Order Book
The directors have reviewed the position of the Group
at the end of the first quarter and are pleased to note
a 20% improvement in the forward order book from R 5,0
billion to R 6,0 billion since 30 June 2004. Based on
project revenues for the first quarter of R 1,75
billion, an order inflow of approximately R 2,75 billion
is indicated in the period.
Two high-rise building projects in the Middle East,
two underground mining projects in Canada and South
Africa and sundry building and mining-related projects
in South Africa and the rest of SADC form the bulk of
this improvement. But order book erosion is evident in
the infrastructure and engineering construction sectors.
The Bureau for Economic Research (BER) Confidence Index
for these sectors has recorded a strong upward trend
over the past quarter and we expect this to reflect
through into new orders within six months.
The order book includes R 750 million of revenues on
long-term contracts for which provisions were raised in
previous years against future losses. This includes San
Stefano in Egypt, the ADNOC head office in Abu Dhabi and
a road contract in Benin. These projects will be cleared
by financial year-end and continue to receive high-level
executive attention.
Consani continues to trade at break-even with the
strength of the SA currency severely impacting its
sustainable business model. The general construction
economy in South Africa remains buoyant offering
consistent opportunity to the Group’s construction
materials and services businesses.
Acquisitions & Disposals
Disposal of the Group’s 44% shareholding in Unitrans
Limited is on schedule, subject only to competition
authority approval. Headline earnings will be diluted
through the sale of Unitrans, although the effect on
attributable earnings, cash and net asset value will be
positive.
The requisite majority of ordinary and preference
shareholders in The Cementation Company Africa Limited
approved the delisting of both forms of security from
the JSE Securities Exchange South Africa (JSE). Holders
of approximately 3% of ordinary shares and 30% of
preference shares have yet to accept the Group’s offer
for their shares.
South African regulatory conditions have been
satisfied in respect of the Group’s proposed acquisition
of a stake in Clough Limited. The transaction remains
subject to Australian regulatory conditions and approval
by ordinary shareholders in Clough Limited and the
Notice of Meeting and Explanatory Memorandum was
circulated on schedule for the company’s annual general
meeting on 10 November 2004. Details are available at
www.Clough.com.au
Conditions precedent to the sale of Booker Tate were
satisfied by 30 September 2004 and the transaction has
been concluded with local sugar group TSB.
Appointments
The board of Murray & Roberts is pleased to announce
that Mr Sean Flanagan will be appointed an executive
director of the Group and Ms Sandi Linford as Company
Secretary with effect from 1 November 2004.
Sean Flanagan joins the corporate leadership team
with executive responsibility for the Group’s
construction, mining and development activities in South
Africa and the rest of SADC. Sean joined Murray &
Roberts in 1991 in the Group’s property development
division, becoming managing director of its Gauteng
business unit before his appointment as managing
director of Murray & Roberts Engineering Solutions in
1997. He has played a key leadership role in the
delivery of the Mozal and Hillside aluminium smelters
and for the past six months has led the process of
integrating Cementation into the Group.
Sean’s proven leadership skills in project
development and implementation are now available to a
broader spectrum of the Group’s business activity and
together with Keith Smith, the Group’s primary business
activities in the southern Africa region are now under
focused executive leadership. The Group Chief Executive
is consequently released to focus on the challenges
associated with Globalising Murray & Roberts.
Sandi Linford has many years experience as company
secretary in some leading companies listed on the JSE
and will enhance the capacity of the Group as a member
of the corporate executive leadership team.
Mr Malose Chaba has been appointed a director of
Murray & Roberts Limited and member of the group
executive committee with effect from 1 November 2004.
Malose joined the Group in May 2004 as managing director
of Murray & Roberts Engineering Solutions. He has
executive responsibility in Murray & Roberts for the
Gautrain proposal process and is developing new market
opportunities associated with the energy sector.
Since publication of the annual report, Mrs Vanida
Lennon joined the Murray & Roberts leadership team with
executive responsibility for sustainability management.
Vanida, a lawyer by profession, will fulfil the
executive responsibility required of the Group’s Health
Safety Environment and Corporate Social Involvement
(HSEC) Committee under chairmanship of newly appointed
independent director, Mr Michael McMahon.
Empowerment
The Group continues to engage its preferred model for
broad-based empowerment of its South African and
regional construction and mining activities.
Negotiations have advanced and an announcement will be
made only once all conditions required by the various
parties concerned have been satisfied.
Prospects
The Group remains in contention for a share of
various large projects planned for South Africa and the
Middle East. Both these regions show signs that current
levels of general investment into their construction
economies will continue and possibly increase, although
some pressure is being experienced with the supply of
skills and materials. The Group is confident that the
current demand for development of the human habitat and
built environment in its chosen markets will be
maintained for the foreseeable future.
The directors maintain their expectation that
headline earnings for the year to 30 June 2005 will not
show a material change while the Group reorganises
itself to meet the objectives of Globalising Murray &
Roberts.
Johannesburg
27 October 2004
Sponsor
Merrill Lynch South Africa (Pty) Ltd
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