Building and engineering giant Leighton Holdings has raked in a first quarter profit well in excess of that achieved in the same period last year and confirmed it remains on track to deliver at least $540 million in earnings this calendar year.
In a statement, the company said it had achieved an underlying net profit after tax for the first three months of the year of $159 million – up 29 percent on the same period in 2013.
Statutory net profit after tax, meanwhile, rose 24 percent to $152 million whilst gearing fell from 47.2 percent to 38.5 percent and the firm bagged $4.4 billion worth of new contracts (up 10 percent), albeit with the value of work in hand easing back 3 percent to come in at $40.9 billion.
Furthermore, whilst revenue expanded by 7 percent, most of the profit gains were driven by higher margins, which rose 0.5 percent to 2.8 percent.
Substantial contract wins during the quarter included the $453 million contract to construct the Central - Wanchai Bypass tunnel in Hong Kong and a $1.9 billion joint venture contract for the construction of a highway in Qatar.
Last week, the group also secured a $US201 million contract to build a segment of the North Luzon Expressway in the Philippines.
The company has also reiterated previous market guidance of full year net profit (underlying NPAT) for calendar 2014 of between $540 million and $620 million.
New company Chief Executive Officer Marcelino Fernández Verdes welcomed the results, saying the group was focused on winning quality projects which it could successfully deliver.
“Our markets are continuing to offer a good range of new project opportunities especially in infrastructure construction and we are confident that we are well positioned to participate” Fernández said.
The latest announcement follows confirmation last week that parent company Hochtief’s offer to acquire three out of every eight shares in Leighton it did not already own was final and would not be extended.
If accepted by all eligible shareholders, that offer would see Hochtief increase its stake in Leighton from around 58 percent to almost 75 percent.
Fernández and new Chief Finance Officer Javier Loizaga were both appointed earlier this year following the sacking of former CEO and CFO Hamish Tyrwhitt and Peter Gregg in March as Hochtief moved to consolidate its grip on power at Leighton.