Engineer and services contractor UGL Ltd sees a 10% to 15% improvement in 2011 profit, which will be a lot better than the 1.5% improvement revealed yesterday for the year to June.
That modest rise was struck on a 12% fall in revenue to $4.19 billion for the train manufacturer and engineering and property services company.
Net profit rose to $144.5 million in the 12 months to June 30 compared with $142.5 million in the 2009 financial year.
UGL shares fell 30c to a low of $13.45 in early trading as the market reacted negatively to the small rise in earnings.
But they bounced sharply to be up 63c, or more than 4.5%, at $14.140 at the close as the market reassessed the result.
The company said underlying profit would grow by 10% to 15% in 2010-11, which would take it to more than $170 million.
UGL declared a final dividend of 35c fully franked, taking the full year distribution to 64c.
That’s unchanged on the 2009 payout.
UGL managing director Richard Leupen said despite difficult economic times the company expected to resume stronger growth in 2011.
"Our essential services focus continues to deliver healthy forward workloads, visibility and stability across the group," Mr Leupen said.
“Following the award of $5.3 billion in new contracts and extensions, UGL’s order book stood at a record $9.1 billion.
"We also have $5.8 billion in weighted and qualified opportunities in progress, supported by a strong near term pipeline including $1.2 billion of work at the preferred tenderer stage."
The company said its record underlying profit came on the back of record contributions from three of its four business units.
Earnings before interest and tax in its rail segment fell 31% to $55.2 million, but EBIT for its infrastructure, resources and services units all were up.
Perth-based contractor Monadelphous Group has reported a 12% rise in earnings for 2009-10 and lifted dividend.
And the company said in its profit announcement yesterday that it has a healthy workload in sectors such as resources and energy.
Net profit rose to $83.22 million, compared with $74.24 million in the 2009 financial year.
That was off a 13.5% lift in group revenue to $1.28 billion.
The company declared a final dividend of 48c per share fully franked (up 9.1% on the final for 2009) and taking the full year payment to 83c, up 12.2% on the 74c a share paid in 2009.
Monadelphous managing director Rob Velletri said in yesterday’s statement that the record $1.275 billion in revenue was achieved through strong delivery performance to blue-chip resources customers and increased participation in the energy sector.
"Revenues from the energy sector now contribute more than 30 per cent of Monadelphous Group’s total sales, compared with five per cent four years ago," Mr Velletri said in the statement.
"This sector is now established as one of the company’s core markets."
Looking to the 2011 year, the company said it has entered the 2010-11 financial year with a healthy workload and the ongoing outlook for the resources and energy sectors remains positive.
"A rebound in commodity prices and general improvement in capital market conditions early in the 2009-10 financial year signalled that market conditions for the resources sector were quickly returning to more buoyant levels.
"The combination of a number of macro-economic factors has, however, led to some uncertainty on the timing of a return to full use of industry capacity.
"The company believes that labour supply will tighten as large scale oil and gas projects in Western Australia enter the next development phase.
"Monadelphous will continue to invest resources in initiatives to attract, retain and develop people who deliver quality work, share the company’s values and contribute to the group’s long-term success.
"Major development projects in iron ore, coal and LNG will provide a healthy pipeline of opportunities for the company in its core markets.
"While the market environment remains highly competitive, Monadelphous is in a strong position to capitalise on these opportunities.
"The group will continue to focus on diversifying its revenue base through growth in its newly established Infrastructure division.
"Expansion opportunities in the water and solid waste management markets, along with its newly acquired transmission pipeline business, are expected to provide the company with ongoing growth opportunities.
"The group expects further development of its Infrastructure division will assist Monadelphous in building a more resilient business for the future.”
The shares rose more than 3% or 47c to $14.67 yesterday.
Engineering contractor Macmahon Holdings Ltd, whose major shareholder Leighton Holdings, reported yesterday a 120% improvement in 2010 earnings from the depressed levels of 2009.
The company told the ASX yesterday that net profit rose to $37.9 million for the year ended June 30, 2010, compared with a profit of $17.2 million in the 2008-09 financial year.
Revenue fell 16% to $1.25 billion, thanks to the continuing impact of client-imposed cancellations and the scaling back of mining projects during the financial crisis.
"Macmahon has now returned to more stable profit margins after experiencing a difficult period in 2009, which saw profit decline as a result of one-off impacts driven by the global financial crisis," the company said.
The company will pay a final dividend of 1.5c unfranked, bringing the total dividend for the financial year to 3c.
That’s double the unfranked 1.5c a share paid for 2009.
Macmahon said it has secured over $2.1 billion of new contracts and extensions and mov
