Group Five construction group, said on Tuesday that earnings per diluted share for fiscal year 30 June 2011 was lower between 45% and 55% (253c 309c per share per share) compared to 561C per share in F2010.
In a trading update, said the group of the slowdown in the construction industry in the last two years after the crisis in global markets, deteriorating trading conditions in the markets of construction and materials used in Group Five.
“This has a negative impact on the performance of the year that the group still benefits awarded from 2010 onwards, the majority of large public contracts before the World Cup. In the meantime, to this environment in a temper to some degree, the group successfully targeted African markets in which it returns a success story, “the group said.
Consequently, the current earnings per share (HEPS) are expected to be lower between 45% and 55% (338C 277C per share per share) compared to 614c per share in F2010, while diluted earnings per share (FDEPS) is between 195% and 205 % lower (loss of 243c per share to a loss of 269c per share) compared to 256c per share will F2010
Earnings per share (EPS) will be between 190% and 200% lower (loss of 252 cents per share to a loss of 280c per share) compared to EPS of 280c per share in the F2010.
“As stated in the provisional results, was a loss of long-term value of the group of assets of building the federal government recorded rather than the severity of the deterioration of the materials market and the lowest estimates. This write the main difference between revenue and profit as a whole.
“Moreover, in the second half of the year, suffered the group a few times one-time costs, the impact on the result shown negative. These costs are in the nature of operations and when combined, they had an influence on the results of the whole year These costs include:
- The restructuring and showed the expected costs of rationalization in the building materials cluster as in the interim results of the group,
- The cost of ownership in the Middle East after the collapse of the market, including:
- Resources is focused specifically on the regional economy and promote the success of progressive business and financial conditions in the vicinity of the existing contracts in Dubai.
- The effect of time certified discount to the present value of debt remains at one of the group mentioned above reflect contracts terminated. We have cash flows in accordance with the signed payment plan agreement with our customers.
- Cost of remediation has been successfully applied to a Jordanian pipeline contract.
- The complete loss of power on a steel, almost, the joint venture agreement in the manufacturing industry. “
Deteriorated with the exception of costs on the impact of business conditions in manufacturing, said the group had carried out its remaining businesses in accordance with the guidelines in the last reporting period issued.
“Despite the weak domestic concessions and PPP activities and economic pressures in Europe, continued investments and concessions, contracts written before the new toll system in Eastern Europe and South Africa stable.
“Materials of construction and the construction was delayed due to a combination of lower volumes, the price of the contract, suffered a sharp edge and pressure on prices. Gave Fortunately, the first signs of price stability and the volume of re-entry of building materials in recent months.
“With the exception of the Middle East, as discussed above, the Group held the largest segment, construction, and also based on a good performance of the contract and the benefit of a number of longer-term and some contracts to Africa, which secured strategically in earlier periods “said Group Five CEO.
He added that the construction in South Africa and Market Engineering had other delays in procurement and workflow in an industry that is already seen limited excess capacity. The work offers that took place was very old by the young entrepreneurs and forward with very aggressive prices.
“The focus on a larger geographic footprint for more business units of the Group and achieve rapid gains in the re-emergence of the mining and energy markets in Africa remains the strategy, the dependence of weak markets, reduce interior.
“The construction industry in targeted geographic areas and sectors of the Group has a solid medium-and long-term prospects, but in the short term, the conditions are worse than expected. This weakness is expected to continue for longer to materialize with a slow recovery from a wider market in the second half of F2012, which will inform the business development of the F2013, “added the group.
Group audited results for fiscal year 30 June 2011 15thAugust be published in 2011, when the group is to update the market on its activities during a presentation in Johannesburg on the same day, and Cape Town on 16 to Sens August 2011.
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