Infrastructure, resources and contract mining group Aveng is back in the black, reporting its first headline per share profit since 2014 after all its main subsidiaries made profits in the six months to December 31. Photo: Reuters
Infrastructure, resources and contract mining group Aveng is back in the black, reporting its first headline per share profit since 2014 after all its main subsidiaries made profits in the six months to December 31. Photo: Reuters

Aveng generates its first interim headline profit per share since 2014

By Edward West Time of article published Feb 24, 2021

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CAPE TOWN - INFRASTRUCTURE, resources and contract mining group Aveng is back in the black, reporting its first headline per share profit since 2014 after all its main subsidiaries made profits in the six months to December 31.

The group said that its interim headline earnings per share came to 0.6 cents versus a 1.1c loss per share at the same time last year.

Headline earnings improved by R314 million to R109m compared with a R205m loss previously. The headline loss at the last year-end to June 2020 amounted to R950m.

Chief executive Sean Flanagan said the result was a culmination of “some hard decisions by the board in 2017” to restructure.

He was cautiously optimistic about the future and was conscious that “one swallow doesn’t make a summer” and they needed to continue to perform well into the future to regain the trust of shareholders and other stakeholders.

Revenue increased to R12.9 billion from R11.2bn in 2019, with core revenue up 53 percent driven in the main by improved performance at McConnell Dowell, the Australian-based construction group.

Turnover at contract mining subsidiary

Moolmans was much in line with last year due to a turnaround plan being implemented, but its operational earnings were up 13 percent over the period.

Operating earnings increased substantially to R280m from R14m, with McConnell Dowell, Moolmans, Trident Steel and Manufacturing all profitable.

Moolmans generated strong operating earnings, and although there was still some restructuring to happen in its operations, it would not be at the expense of growing the business and reducing costs, said Flanagan.

Trident Steel, considered non-core and held for sale, was also performing well with operating earnings of R107m, said Flanagan.

There was also a strong improvement in group operating free cash flow to R1.4bn from R174m at the same time last year. The net cash position improved by R1bn to a net cash position to R579m.

Work in hand increased to R27.7bn from R26.8bn, with McConnell Dowell adding AU$1n to work-in-hand.

Some 52 percent of work in hand was in Australia, 16 percent in South Africa, 23 percent in South East Asia and 8 percent in New Zealand.

Net asset value a share increased to 10.8c per share from 9.5c per share in the comparative period.

Aveng’s share price closed 25 percent lower at R0.03 on the JSE yesterday.

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