Aveng, the international engineering and Africa mining contractor group, said Friday it expects to report a loss per share of between A$25.3 cents and A$25.4 cents for the six months to December 31.
A headline loss per share of between A$26 cents and A$27 cents is likely, compared with earnings per share of A$0.6 cents and headline earnings per share of A$8.8 cents in the prior period, the group said in a trading statement.
The group, which operates the McConnell Dowell infrastructure construction engineering group and the Moolmans mining contractor services company, said the New Zealand & Pacific Islands business unit continues to deliver a strong performance.
The Australia and South-east Asia business units had underperformed on certain projects awarded prior to the COVID-19 period. The majority of these projects had been managed to a satisfactory outcome and, whilst not contributing profit, they would represent a reduced proportion of revenue as these projects move towards completion.
“The remainder of the project portfolio continues to perform well and contribute to an improving margin,” the group directors said.
The Australia business unit reflected improving margins, excluding the Kidston Pumped Hydro loss-making project, but the unit would report a breakeven result. The Kidston project in Queensland had not achieved expected productivity, resulting in a loss in the period.
In South-east Asia, the new projects were profitable. However, the Jurong Region Line (J108) project for the Land Transport Authority in Singapore experienced delays and disruptions, which resulted in commercial claims and increased forecast costs. The project would report a significant loss in the period, and the South-east Asia business unit would report a loss.
“Whilst additional costs in the forecast... have been recognised, the cash flow impact will largely materialise over the next 18 months as the projects move towards completion. Aveng will continue to report a healthy cash balance of A$252 million at December 31, 2024 (A$233m at June 30, 2024) for the Infrastructure and Building segments, supported by continued strong cash generation.”
Moolmans was expected to report positive operating earnings for the six months and was at an advanced stage of negotiations to conclude a new 60-month contract with Gamsberg. The group expects to release results on February 18, 2025.
BUSINESS REPORT