Business / Companies
Murray and Roberts turnover increased by 97%
22 Sep 2011 at 12:14hrs | Views
An improved set of finals from construction concern Murray and Roberts with turnover moving up 97% (2% below budget), supported by a 57% contribution from the construction division and 43% from the manufacturing side.The gross profit margin declined from 24% to 18%, due to a change in the revenue mix, as the lower margin construction division contributed more.
Administration overheads totaled 15% of turnover against a budget of 14%. Retrenchment and restructuring costs amounted to 4% of total overheads as the group continues to focus on cost rationalisation. The profit from continuing activities amounted to $1.1 million and after a slight loss from discontinued activities, the Profit After Tax totalled $1.1 million, registering a 3% margin against a 4% budget (FY 2012- targeting 7%).
The cashflow statement shows $504,591 generated from operating activities whilst there was a $1.5 million spend on capital expenditure which resulted in a negative closing position of $124,259.
On the operations, the contracting division's revenue for FY 2011 was $20 million, with 77% coming through from buildings and 22% from civils as low business activity characterised the mining sector. The division completed four good quality projects during the year.
Proplastics's recorded a strong performance in the second half compared to the below par performance for the first half. Volume traded for the year was 4,968 tonnes up 40% from the previous year. $2.3 million was invested in factory equipment and all the equipment was commissioned in July 2011. Production and operational efficiencies are expected to improve, with the use of the new equipment.
On the outlook, the construction unit has a $30 million confirmed order book for 2012, although the projects are mainly short term and should be completed by June 2012.
Tendering activity is however very high for mining and government projects and the success rate is good at about 50%. Management noted that they are currently operating at 25% of the unit's peak year turnover equivalent of $90.8 million in current monetary terms.
At Proplastics, the confirmed order book is 1,702 tonnes and management is targeting 6,500 tonnes for FY 2012, with growth linked to construction activity, revival of agriculture and sewer and water reticulation programmes.
Revenue is expected to grow by 100% for FY 2012, with a targeted revenue split of 67% from construction, 30% from Proplastics and 3% from cement. A minimal increase is expected in the overhead structure which will support an increase in margins.
The construction sector is generally one of the last sectors to recover in any economic turnaround. We are thus impressed with the improved performance coming through from M&R. The critical mass that is being gathered should enable the company to fend off smaller competitors and also win some of the bigger projects as they come through.
Administration overheads totaled 15% of turnover against a budget of 14%. Retrenchment and restructuring costs amounted to 4% of total overheads as the group continues to focus on cost rationalisation. The profit from continuing activities amounted to $1.1 million and after a slight loss from discontinued activities, the Profit After Tax totalled $1.1 million, registering a 3% margin against a 4% budget (FY 2012- targeting 7%).
The cashflow statement shows $504,591 generated from operating activities whilst there was a $1.5 million spend on capital expenditure which resulted in a negative closing position of $124,259.
On the operations, the contracting division's revenue for FY 2011 was $20 million, with 77% coming through from buildings and 22% from civils as low business activity characterised the mining sector. The division completed four good quality projects during the year.
Proplastics's recorded a strong performance in the second half compared to the below par performance for the first half. Volume traded for the year was 4,968 tonnes up 40% from the previous year. $2.3 million was invested in factory equipment and all the equipment was commissioned in July 2011. Production and operational efficiencies are expected to improve, with the use of the new equipment.
Tendering activity is however very high for mining and government projects and the success rate is good at about 50%. Management noted that they are currently operating at 25% of the unit's peak year turnover equivalent of $90.8 million in current monetary terms.
At Proplastics, the confirmed order book is 1,702 tonnes and management is targeting 6,500 tonnes for FY 2012, with growth linked to construction activity, revival of agriculture and sewer and water reticulation programmes.
Revenue is expected to grow by 100% for FY 2012, with a targeted revenue split of 67% from construction, 30% from Proplastics and 3% from cement. A minimal increase is expected in the overhead structure which will support an increase in margins.
The construction sector is generally one of the last sectors to recover in any economic turnaround. We are thus impressed with the improved performance coming through from M&R. The critical mass that is being gathered should enable the company to fend off smaller competitors and also win some of the bigger projects as they come through.
Source - Imara Stockbrokers
