Thursday, 25 February 2010 02:00

Murray and Roberts earnings 200c vs 302c

Murray and Roberts has reported headline earnings per share of 200c for the 6 months ended December 31, 2009, from 302c previously.

Wednesday, 21 January 2009 02:00

Murray and Roberts JV contract cancelled

South African-based construction firm Murray & Roberts says that the Salam Resort joint venture project in Bahrain has been cancelled.

Record order books are expected to help construction stocks maintain decent earnings growth in the new year, but beyond that the future is uncertain as the global credit crisis eats up future work opportunities.

Construction IndustrySouth Africa‘s big-four construction firms boast a combined R120 billion order book, thanks to the phenomenal sector growth in the lead-up to the 2010 Fifa World Cup, as well as developments in other markets.

While these order books will certainly build up construction groups‘ coffers, the global economic slowdown – which is expected to deepen next year – may open floodgates of project cancellations and delays.

So, while “the outlook for next year is pretty decent, future work opportunities have been reduced”, says one analyst, who declined to be named.

Already Murray & Roberts, the country‘s largest construction firm, has had to adjust its books after its Trump Tower joint venture in Dubai was suspended, wiping R3,2-billion off its R61-billion order book, although the firm landed a R6-billion contract to build a terminal at Dubai International Airport shortly after this.

Underscoring predictions of the tough trading conditions ahead are union claims that Murray & Roberts is planning to axe workers as the rough trading environment restricts its ability to expand.

Group Five disclosed in an interview that there “had been a small and immaterial reduction” in the number of projects in the African mining sector and that “one small housing project” for a mining firm had been cancelled.

Eskom has also terminated the procurement processes for the proposed multi-billion-rand Nuclear-1 power plant project.

Aveng and Murray & Roberts were in two separate consortiums bidding to build the power plant, with Aveng saying the termination was “understandable” and that it had confidence in the continued infrastructure roll-out in the markets in which it operated.

“I don‘t think we have seen the last of these project cancellations and delays,” the construction analyst said.

Project flow from the mining sector is expected to worsen in the new year, with Group Five having already seen a slowdown in African copper mining.

Mining companies across the world are cutting back on production as weakening commodity prices bite into earnings, with Anglo American and Anglo Platinum expected to slash capital expenditure in half when they announce revised spending plans next week.

Together with public sector spending, construction companies also based their original rosy 2009 outlooks on “continuing demand for commodities”, which was expected to spur expansions in the mining sector, although many miners are now cutting back.

Aveng has downplayed the impact of the global crisis, saying its project pipeline remained strong, but it is “taking longer for clients to finalise projects”.

For the next few years the sector is banking on South Africa‘s multibillion-rand infrastructure spending, but if the national treasury is unable to raise funds offshore to counter shrinking foreign capital inflows it may need to reprioritise its spending plans.

South Africa is spending R600-billion over the next three years to upgrade and build new roads, power generation and transmission, rail, ports, pipelines, hospitals, prisons and schools.

Another analyst said the fact that Eskom – which accounts for the bulk of the infrastructure package – had to shelve its nuclear project suggested that even governments, albeit to a lesser extent, were feeling the pinch of tighter credit lending.

“Those with no exposure to public sector spending are in for a rough time,” the analyst said.

But all big-four construction companies are comprehensively exposed to this multi-billion-rand package, with Murray & Roberts saying it will drive annual growth of 15% to 25% through to at least 2014.

 

Tuesday, 09 December 2008 02:00

Murray and Roberts wins Dubai project

Engineering and construction company Murray & Roberts has been awarded a major contract to build a terminal at Dubai International Airport with joint venture partner Al Habtoor.

Al Habtoor Murray & Roberts Takenaka Joint Venture has been awarded the contract for Concourse 3 at Dubai International Airport for the Department of Civil Aviation.

Wednesday, 08 March 2006 02:00

Group Five wins airport contracts in Dubai

Group Five's foray into the increasingly lucrative Dubai market is gathering momentum

Friday, 17 February 2006 02:00

Group Five to revisit over-border work

Group Five is to revisit its level of over-border work as a result of the SA Government's infrastructure budget, says Mike Lomas, the company's CEO

Thursday, 27 October 2005 02:00

Murray & Roberts ecstatic about earnings

Murray and Roberts is upbeat about prospects, with directors expecting real growth in headline earnings in the year to June 30 2006

Tuesday, 07 June 2005 02:00

Group Five gets major contract in Dubai

Group Five has, in conjunction with its sponsors Al Naboodah Contracting Company, been awarded a contract by Dubai Civil Aviation for approximately R940m

GROUP Five’s share price leapt 5% yesterday after it said it had landed a R940m contract to build a cargo terminal at Dubai International Airport

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