30/08/2012 - 15:26

VDM says turnaround is progressing

30/08/2012 - 15:26

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VDM says turnaround is progressing

Construction and contracting group VDM says it expects to build on positive momentum built in the second half of the 2012 financial year, after lodging an annual loss of $54.8 million.

VDM said the result was adversely impacted by a $31.5 million loss from discontinued operations relating to Cape Crushing, which the company sold for $45.9 million in April.

The company’s net loss from continuing operations was $5.7 million in the second half of FY2012, after it lost $17.5 million from continuing ops in H1.

The second half result includes a $4.8 million writedown from a loss making project, as announced in June.

VDM said it was entering the 2013 financial year in a much stronger position than the previous year, with net cash as of June 30 at $23.6 million and all bank debt fully repaid.

The company said its order book had stretched out to $170 million.

Managing director Andrew Broad said the result was disappointing, but improvements in the second half performance were encouraging.

“Based on our current work in hand, VDM expects the improving trend to continue into the first half of FY2013 – beyond that we will need to continue to win new work to maintain this momentum,” Mr Broad said.

“We aim to further consolidate on our design and construct business model across Western Australia and Queensland as we successfully deliver on civil and resources infrastructure projects.

“VDM has emerged from a challenging year with a strong balance sheet, improvement on our relationships with key clients, and a business model that is better suited to generating sustainable long-term returns.”

VDM stocks closed up 2.27 per cent, trading at 4.5 cents.

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