The Midrand offices of multinational professional services firm PwC under construction by WBHO. Simphiwe Mbokazi
Pretoria - The Australian building business of listed construction and engineering group WBHO has secured almost R11 billion in new work since January this year across the retail, commercial and residential markets.

The businesses accounted for 65 percent of the group’s total order book of R40.2 billion in December.

The group on Tuesday reported that WBHO Australia had increased its stake in Pro build Construction to 85.6 percent through the acquisition of a further 0.8 percent shareholding from minority shareholders for AUS$1.4 million (R13.9 million).

WBHO entered the Australian market in 2001 after acquiring an initial 40 percent interest in Probuild Construction.

Offset

However, WBHO’s Australian order book decreased 15 percent to R26.2 billion at the end of December from R30.9 billion in June last year, contributing to the 6-percent decline in WBHO’s total order book to R40.2 billion in December from R42.7 billion in June.

The group reported a 7 percent decrease in the building and civil engineering order book to R8.1 billion in December from R8.7 billion in June, which was offset by a 92 percent increase in the group’s road and earthworks order book to R5.8 billion from R3 billion in the same period.

Louwtjie Nel, the group chief executive of WBHO, said the Australian building market remained strong and Probuild continued to maintain sound relationships with key clients, resulting in repeat contracts.

Probuild in the six months to December secured its largest contract yet, the AU$340 million Greenland Centre, a 235metre residential skyscraper that will be the tallest residential tower in Sydney.

Nel said the successful relationship with Greenland led to the award of a further project in Sydney in January for a AU$100 million residential development commencing in April.

Nel said that the infrastructure and civil engineering book in Australia had improved by 37 percent since June last year.

He said the order book for building in South Africa remained healthy across all sectors and regions over the short term, but they were beginning to experience some softening in the project pipeline and a slightly lower order intake.

Read also: City of Cape Town takes on WBHO

WBHO reported a 38 percent decline in headline earnings a share to 398cents in the six months to December from 645c in the previous corresponding period.

Adjusting group earnings for the once-off liability from the agreement between the government and seven construction companies that have collectively agreed to contribute R1.5 billion for transformation projects to settle outstanding and potential civil damages claims from state entities, WBHO’s headline earnings per share increased 10 percent to 710.1c from 644.7c.

WBHO will contribute R170 million over a period of 12 years in terms of the settlement.

Revenue from continuing operations was flat at R15.4 billion.

Operating profit before non-trading items declined 4.7 percent to R471 million from R495 million.

Cash generated by operations slumped 86 percent to R136 million from R953 million.

An interim dividend a share of 150c was declared, which was 11 percent higher than the dividend of 135c for the previous period.

Shares in WBHO dropped 1.19 percent on the JSE to close at R145.75.

BUSINESS REPORT