Basil Read profit in 2013 rises on strong revenue
Basil Read CEO Marius Heyns says all the group’s divisions performed well under tough operating and economic conditions, maintaining revenue growth and delivering returns for all our stakeholders.
A strong performance from all the division helped Basil Read Holdings (BSR) to offset declines in its construction, developments engineering and mining arms to post a steady interim profit.
Despite tough market conditions in the construction industry, Basil Read Holdings (BSR) returned to profitability in the year to December‚ boosted in part by its renewed focus on core operations.
Net profit from continuing operations was R100.5 million‚ from a R196.1 million loss in the same period a year ago. Revenue was up 15% to R6.3bn while headline earnings per share were 88.16c v 130.84c loss.
The "solid performance" in the period was helped by a halving of debt, a favourable cash position and foreign exchange gains from the weaker rand.
Basil Read‚ which earlier this month announced the award of two projects together worth more than R400m‚ said its order book was up 22% to R12.5 billion.
"All the group’s divisions performed well under tough operating and economic conditions, maintaining revenue growth and delivering returns for all our stakeholders," CEO Marius Heyns said on Wednesday last week.
“The 2013 financial year was a year of consolidation and stabilisation following a poor operational performance in 2012. With significant prospects‚ a strong order book and a substantially stronger balance sheet‚ we are optimistic that the basics are in place for a successful year ahead‚” he said.
Cash inflow was partially offset by the payment of a special dividend to shareholders of R230m, and the repayment of debt to the value of R464m.
The TWP sale had also led to the closure of the group’s Australia operations and the recognition of a loss of R31.2m.
Net margins from continuing operations improved to 1.6% from a negative margin of 3.6% in the comparative period.
Construction activities saw a 16.1% rise in revenue to R4.6bn and an operating profit of R12.1m, compared with a R277.2m loss for the previous corresponding period. A final provision of R19.9m was made in terms of contraventions of the Competition Act, Basil Read said.
Despite severe labour unrest in the mining sector, the group’s mining division saw revenues of R935.4m compared with R1bn last year. But divisional operating profit fell to R58.9m in the period, from R82.4m last year.
But the mining division had been awarded a five-year contract at the Tschudi copper project in Namibia, and was "well placed" to capitalise on business opportunities elsewhere in Africa.
Basil Read said government expenditure over the next few years was expected to increase "significantly", leaving it positioned to provide "social and gap housing". The engineering division’s revenue rose to R676.4m, but operating profit plunged to R12.9m from R54m previously.
