Leighton positive about future
Leighton Holdings Limited (LEI) said that the 2010 financial year has started well for the company with total revenue for the first quarter to 30 September 2009 up 10% to $4.5 billion. The company said it had generated profit after tax (unaudited) of $131m, an increase of 25% on the prior first quarter.
Chairman, David Mortimer, said the group’s outlook for the 2010 financial year remains solid despite the impacts of the global financial crisis.
“A decline in some of the Group’s core markets has been countered by significant spending by Governments to stimulate economic activity both in Australia and overseas,” Mr Mortimer said.
“For the 2010 financial year, the Group is confident that revenue will exceed $19bn and expects a net profit after tax of around $600m, subject to any further asset impairments."
The company said work in hand at 30 September stood at $38.2bn, up by $1.2bn since 30 June 2009, while in addition, Leightons is preferred on another $4bn worth of work which should be awarded in the near future.
“The company’s record level of work in hand will ensure a steady operating profit in 2010 before the Group returns to growth in 2011,” Mr Mortimer said.
“Substantial government spending on infrastructure – across both Australia and Asia, demand for resources fuelled by the economic growth of China, and an eventual recovery in the property market augurs well for the Group’s longer term prospects.”
CEO, Wal King, added that the company’s newer markets such as the broader Middle East and Mongolia offer great opportunities, while in Australia, the need to invest in infrastructure to improve productivity remains as important as ever.
“Engineering construction is expected to grow to $140 billion per annum by 2018 – more than doubling within a decade,” Mr King said.
“The next decade should see a significant spend on utilities such as water and energy. Additionally, the new $43bn National Broadband Network project should offer the Leighton Group significant construction opportunities.”
Mr King said mining volumes are expected to continue to grow on the back of the growth in demand in the region, while oil and gas as emerged as a great opportunity with some $150 billion worth of projects in the pipeline.
"Looking around at our markets and the opportunities that they are presenting I’m very positive,” Mr King said.
“We are positioned alongside the world’s growth engine - Asia - and have the diversity to take advantage of the many opportunities that we see out there.”
Leighton posted a profit after tax of $440 million at the end of FY09 on revenue of $18.3 billion.
As at 1056 AEDT, Leighton shares were up 4c to $34.02.
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