Weak dollar, oil prices hit Civmec

Perth-based engineering firm Civmec has blamed low oil prices and a weaker Australian dollar for a near-halving of its full-year net profit.

Civmec, which trades on the Singapore Exchange, posted a net profit of $S17.4 million ($A16.9 million) for the 2016 financial year, down from $S30.3 million in the year prior.

Revenue came in at $S396.8 million, down from $S499.2 million reported in FY15, with the company citing a weaker Australian dollar against the Singapore dollar as a major factor in the slump.

Civmec’s infrastructure division accounted for $S136 million of total revenue.

 “Our decision to diversify into other sectors will position us for more sustainable growth in the years ahead,” Civmec chief executive Pat Tallon said.

“As it is, our growing presence in the east coast of Australia has enabled us to secure substantial mining and other infrastructure contracts in that region.”

In a statement, the company said it remained profitable in FY16 despite the prices of oil and other commodities having taken a toll on the offshore, marine and mining industries worldwide.

“Civmec remains committed to advancing its long term growth strategy and diversification of revenue sources,” it said.

“Over the coming year, the group will continue to strengthen its position in growing infrastructure and defence markets in Australia.

“Geographical diversification initiatives will remain a focus.”

Civmec entered FY17 with an order book of about $S155.2 million.