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Prospectus reveals hit on core construction piece

MULTIPLEX’S core construction business in Australia and New Zealand suffered a net loss of $2.8 million in 2003, the company’s prospectus has revealed.

The loss was a rare hiccup in the company’s earnings growth over the past four decades.

The company attributed the loss to a $17.4 million “reversal” on one major project.

“The construction division result was adversely affected by a significant profit write-back on a major project,” the prospectus says.

The company said it expected the construction division’s profit to return to “more normal levels” over the next two years.

It has forecast profits (before interest and tax) of $38 million in 2004 and $33 million in 2005.

The construction business in the UK and Middle East is forecast to perform much better, with profits rising strongly to $62 million in 2005.

The development business tells a different story, with profits in Australia and New Zealand rising steadily to $57 million in 2005.

In the UK and Middle East, the development business is forecast to suffer small losses over the next two years.

However, the company said this reflected the “stringent definition of projects that are included in the forecasts, that is, contracted and highly likely”.

In practice, the company said: “there is an expectation that profits from the development division in the UK will be significant”.

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