The company’s reported net profit of $257.2 million for the six months to June 30 was down 12 per cent on the $291.3 million in the previous year. It also expects to meet its its full year profit forecasts.
But after adjustments for the loss of profits from businesses that have been sold, profit was up 7.5 per cent despite a “short-term softening” in revenue.
CIMIC, formerly known as Leighton Holdings, still expects to post a full-year net profit of between $450 million and $520 million, driven by improved margins and project delivery, cost savings and reduced finance costs.
The company said it received new work orders of $7 billion in the first half, while work in hand totalled $28.5 billion.
Chief executive Marcelino Fernandez Verdes described one of the new contracts, a $175 million services agreement for the Encuentro Oxides copper mine in Chile as “a significant milestone for our mining business, showing the opportunities for our global mining capabilities in North and South America”.
He also said CIMIC had “over $5 billion of tenders in contract mining as we seek to further our diversification by geography and community”.
New orders also include a $900 million contract for work on Sydney’s M4 East Motorway, a $474 million contract for work on Hong Kong’s Shatin-to-Central rail line, and a $1.2 billion contract to develop a border control point between Hong Kong and China.
Mr Fernandez Verdes said CIMIC was also seeking construction deals for stage two of Sydney’s WestConnex road and Perth’s Airport and Freight links.
CIMIC expects about $20 billion worth of new tenders to be awarded in the second half of 2015.
In contract mining, it’s tendered for more than $5 billion of work.
The company said the fall in its construction revenue in the first half of 2015 had reflected Australia’s transition from resources to infrastructure construction.
And, while contract mining revenue was lower it was stabilising.
CIMIC LIFTS FIRST HALF OPERATING PROFIT
- 2015 first half revenue from continuing operations of $7.2b, down 14.1% from $8.3b.
- 2015 first half net profit from continuing operations of $257.2m, up 7.5% from $239.2m.
- Interim dividend of 46 cents per share, fully franked, compared to 57 cents, 25 per cent franked, in prior corresponding period.