12/02/2009 - 11:05

Leighton up on 56% fall in net profit

12/02/2009 - 11:05

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Shares in Leighton Holdings have surged as much as 10 per cent today as Australia's biggest construction company reports a 56 per cent fall in first-half net profit and a $239 million write down on the value of its infrastructure investments.

Leighton up on 56% fall in net profit

Shares in Leighton Holdings have surged as much as 10 per cent today as Australia's biggest construction company reports a 56 per cent fall in first-half net profit and a $239 million write down on the value of its infrastructure investments.

Net profit for the six months to December 31 declined to $111.1 million from $250 million the year before, the Sydney-based company said in a statement on Thursday.

The reduction was due to $239 million pre-tax write downs on ConnectEast, RiverCity Motorway, BrisConnections, Devine and Macmahon Holdings and a reduced contribution from property development.

Revenue for the period grew 37 per cent to $6.55 billion from the year-before period while work in hand increased 41 per cent to $37.5 billion..

The company, majority owned by German engineering giant Hochtief Ltd, declared an interim dividend of 60 cents per share, unchanged from a year ago.

Leighton said operating profit was $387 million before tax, 20 per cent higher than a year ago.

Last month, Leighton said it expected the first-half operating result, prior to the impact of the investment revaluations, to be about $270 million, up about 8 per cent on the prior corresponding period.

The stronger operating result reflected contributions from infrastructure construction projects in Australia, contract mining of iron ore and coal, and construction in the Gulf region.

Leighton said it expected to report full-year revenue approaching $19 billion and reiterated last month's forecast of a full-year operating profit of $650 million.

Full-year net profit is expected to be about $480 million, down from $607.9 million for the 2008 financial year.

Leighton expects to maintain last year's final dividend level of 85 cents a share.

Shares in Leighton climbed up $1.79 to a high of $19.29 before easing to $18.96 at 13:09 AEDT.

Leighton said its longer term outlook remained solid, based on the record level of work in hand, a strong competitive position and forecast rebound in the company's core markets.

The company said it had a strong balance sheet with gross cash of $800 million, short term borrowings of $183 million, limited recourse debt of $772 million and undrawn facilities of $989 million.

 

 

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