| 12-07-07 |
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MURRAY & ROBERTS ISSUES UPBEAT TRADING STATEMENT Murray & Roberts, South Africa’s leading construction and engineering company, has announced that core earnings for its current financial year to 30 June 2007 will be 90% to 100% ahead of its previous year’s performance. The increase is limited to between 70% and 80% when a once-off provision in its Australian associate Clough is brought to account. The company announced it will consolidate its 49% held associate Clough Limited into its accounts with effect from 1 July 2007. In preparation for this, Clough has reviewed its earnings expectation for the full year to 30 June 2007 and has stated in a separate release through the Australian Stock Exchange (ASX) that its core earnings are expected to be ahead of its half-year prospects statement. However, it will raise a provision of “circa AUD110 million” for final resolution of legacy problems and projects, all of which arose prior to Murray & Roberts acquiring any interest in Clough. Clough has also announced that Murray & Roberts will conditionally support a AUD40 million rights issues to recapitalise of its balance sheet and provide guarantees of AUD150 million to support the procurement of new strategic assets in the offshore oil & gas sector. Murray & Roberts also announced that its consolidated project order book at 31 March 2007 increased to R22,0 billion, up from R15,0 billion at 31 December 2006 and R10,0 billion at 30 June 2006. This includes the Clough order book of AUD735 million (R4,5 billion). Commenting on the trading statement, Murray & Roberts Group Chief Executive Brian Bruce paid tribute to the leadership team and people of Murray & Roberts who had responded with such commitment to the buoyant conditions in all the Group’s markets. “This is a great company with great and committed people,” he said. “We stated in our interim report that we had built a formidable performance platform to engage the future potential of all our markets.” He added “Our order book growth is evidence of this capacity in Murray & Roberts and the potential in our markets. And we were confirmed yesterday as a key member of the EPCM contractor for the Coega Aluminium Smelter project in South Africa, a precursor project to the country’s significant long-term power generation program.” Commenting on Clough, Bruce stated that the need for the provision was unfortunate but prudent. The company had faced the reality of its legacy projects and problems and was now free to face the future. Following recapitalisation, Clough will be well established to deliver future value in the growing Asia Pacific offshore oil & gas market. “Over the past year Clough has appointed a new independent chairman, installed a new executive leadership team which will soon be enhanced with high-level global capacity in the oil & gas sector, and in partnership with Murray & Roberts, has embarked on an asset procurement strategy to position itself as a leading player in its market.” Bruce added that the consolidation of Clough from 1 July 2007 would significantly increase the scale of Murray & Roberts, making it one of the largest contracting groups in the world.
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