Strength in Western Australia’s resources sector has boosted the bottom lines of local engineering and construction contractors Monadelphous, Macmahon and LogiCamms, with Monadelphous being the pick of the bunch.
The company said its 26 per cent rise in first half profit was a record, adding that a growing number of resources projects would continue to drive revenue growth.
Monadelphous said its record net profit and revenue in the six months to December 31 was due to strong growth in sales in its maintenance and industrial services, and infrastructure divisions.
That growth came from the historically high level of large resources and energy projects being built, the company said in a statement.
Monadelphous reported a net profit of $57.5 million for the six months to the end of December, up from $45.5 million in the previous corresponding period.
Sales revenue in the six months to December was $879.5 million, up 26 per cent from $700.1 million in the previous corresponding period.
With many iron ore, coal and liquefied natural gas (LNG) projects currently in the planning stage, Monadelphous said it expected its full year revenue growth to be similar to what was generated in the first half.
The company declared a fully-franked interim dividend of 50 cents per share, up from 40 cents for the same period in the previous year.
Macmahon also produced a strong result, with its interim profit up 27 per cent on the previous half year at $23.2 million.
The company paid an interim dividend of 1.5 cents per share.
Macmahon chief executive Nick Bowen said the result was a big step in the right direction.
He said revenue increases were achieved across all business units, with the addition of new projcets including Boddington, George Fisher, Gladstone LNG, Solomon Rail Spur and the Pilbara ISA, along with further expansion across its existing projects.
“A strong balance sheet and robust operating cash flow, together with the company’s upsized financing facilities mean that Macmahon is well-placed to deliver ongoing growth well into the future.
“Macmahon has a current tendering pipeline in excess of $3 billion.”
Mr Bowen said he expected a similarly strong second half of the year.
“With the strong order book and pipeline of opportunities, Macmahon is on track to deliver not nly a record profit for FY12, but further growth in FY13.”
Finally, LogiCamms reported an 11 per cent lift in its net profit after tax for the half year, to $4.7 million.
LogiCamms managing director Steve Banning said the company’s revenue grew by 1 per cent, to reach $56.1 million.
The company paid a fully franked interim dividend of 3.5 cents per share, up 8 per cent on the previous dividend.
“This solid earnings result reflects an increase in project activity and our personnel numbers, in addition to a focus on risk management activities and greater operational efficiency.”
Also today, LogiCamms announced a $2 million share-buyback program.
“This will provide LogiCamms the flexibility to repurchase shares, particularly in times of market or share price volatility, and will operate as an effective method to return capital to shareholders,” chairman Peter Watson said.