Civil and mining contractor Brierty has today reported a 52 per cent drop in its first-half net profit as Fleetwood Corporation managing director Bob McKinnon prepares to take over from Harvey Collins when he steps down from Brierty's board.
Civil and mining contractor Brierty has today reported a 52 per cent drop in its first-half net profit as Fleetwood Corporation's outgoing managing director Bob McKinnon prepares to join its board.
Brierty today said net profit for the first half of the 2010 financial year reached $2.2 million, down from $4.6 million recorded in the previous corresponding period.
The profit result was on the back of a 41 per cent drop in revenue to $61.6 million.
The directors have declared an interim dividend of 0.5 cents per share, fully franked.
Meantime, non-executive director Mr Collins has announced he will resign from Brierty's board to concentrate on his expanded role as chairman of Bankwest. Mr Collins is also chairman of Navitas and deputy chairman of Verve Energy.
He will be replaced by Mr McKinnon, who will leave his role at Fleetwood soon. Last week, former Wesfarmers senior manager Stephen Price was appointed as chief executive of Fleetwood.
Additionally, Ken Hellsten will join Brierty's board.
The announcement is below:
The company reported EBITDA of $7 million and maintained its ECivil and mining contractor Brierty Limited (ASX: BYL) today announced an audited net profit after tax of $2.2
million on revenue of $61.6m for the Half Year ending 31 December 2009.BITDA margin at 11.3%, in line with the prior comparative period margin of 10.7%.
Brierty Managing Director Stuart Crofts said that while the revenue result reflected the downturn in the Australian economy during 2009, the profit figure demonstrated that Brierty was able to maintain operating margins even against the backdrop of a lower revenue base.
"The result shows the benefits of the internal restructuring and cost control initiatives put in place at Brierty during the past two years," said Mr Crofts.
"It is very pleasing to see that we have held and even marginally improved our operating margins, even when revenue for the half was down on the previous corresponding period.
The result also validated Brierty's strategy of running a portfolio of projects across the resources and infrastructure sectors.
While all business units returned a profit, the transport infrastructure and land development businesses outperformed the resources infrastructure and mining operations, providing a strong revenue and profit base.
Mr Crofts said improved asset utilisation and an internal focus on strengthening processes and systems helped the company align its cost base with revenues during the period.
"The way we now have the business structured will provide us with a solid platform to grow profitability as opportunities arise in what we expect to be a strengthening market, driven by WA resources projects," he said.
Revenue was down on the prior comparative period due to the cancellation or deferment of major projects as a result of the global economic downturn.
This Half Year result was comparable with the second half of last financial year and consistent with the Company's expectations for a softer calendar year 2009.
Earnings per share for the December 2009 half were 2.0 cents per share and the Directors have declared an interim dividend of 0.5 cents per share fully franked.
The Transport Infrastructure business unit performed particularly well as a result of Brierty's long term contracts in this sector and increased government spending on infrastructure.
Revenue and profit from the construction and sale of the substantially complete first stage of the Bellamack development in the Northern Territory has not yet been recognised as settlement on land sales is expected in the second half of the financial year.
Brierty's resources infrastructure and mining businesses were impacted during 2009, however the outlook for this market sector is positive. Recent contract wins have seen Brierty secure projects with new clients in the resources sector.
In the last month, Brierty has secured $20m in new contracts across the company's operating divisions.
"Brierty has a history of building and maintaining strong relationships with its clients and a proven track record in generating repeat business," he said.
"We are excited about the years ahead and believe we have the right business model and strategy in place to win new business and generate healthy returns for our shareholders."
BOARD CHANGES AT BRIERTY
Mr Harvey Collins is stepping down as a Director of Brierty and will be replaced by Mr Bob McKinnon. In addition Mr Ken Hellsten will be joining the Brierty Board.
Mr Collins was recently appointed as Chairman of Bankwest, and is also Chairman of Navitas Limited and Deputy Chairman of Verve Energy. He is resigning to concentrate on his expanded role at Bankwest and his other responsibilities.
Brierty Chairman Dalton Gooding thanked Mr Collins for his service to Brierty's shareholders.
"Harvey leaves us with our very best wishes and we thank him for his significant contribution to the Board" Mr Gooding said.
Mr Gooding said Brierty was pleased to announce the appointment of Mr Bob McKinnon to its Board.
Mr McKinnon is an experienced Company Director and has significant management experience in the mining and industrial sector. He is currently a non-executive director of Bankwest. Presently Managing Director for Fleetwood Corporation, Bob is expected to step down from this position in the near future. He was Managing Director of shipbuilder Austal for five years prior to this, and previously held senior positions with Capral Aluminium Limited and Alcan Australia Limited.
Mr McKinnon is a Fellow of CPA Australia and the Chartered Secretaries Australia.
Mr Hellsten has held senior executive positions ranging from exploration to development and operations in the resources sector In his most recent role as Managing Director for Polaris Metals NL he delivered excellent value for shareholders and has previously held senior roles with BHP Billiton, Centaur Mining, Ironclad Mining and Billiton Australia. His extensive knowledge of the resources industry will provide the board and management with significant expertise on how the company can best benefit from its involvement in this growing sector.
"We would like to welcome Bob McKinnon and Ken Hellsten to the Board of Brierty. Their extensive company management, resource industry and financial expertise will be of great value to the company in the future," Mr Gooding said.
