Yesterday was the second last day of the June 30 reporting period, so a string of losses or profit slumps were to be expected as companies held back the bad news.
Civil engineer and contractor NRW Holdings Ltd reported a fall in annual profit but expects to see a rebound this year with the new mining boom.
NRW Holdings said net profit dipped 5.2% to $35.129 million in the year to June 30, 2010, from $37.068 million in the prior year.
Investors didn’t worry, they pushed the shares more than 7% higher, or 9.5c, to $1.33, in a solid day’s trading yesterday.
The company said net profit was up 2%, however, from $37.1 million to $37.9 million, before a small goodwill write-down.
Revenue jumped nearly 20% to $609.74 million in 2010, from the 2009 figure of $509.6 million.
The company declared a final dividend of three cents, fully franked, for a total dividend of six cents, up from two cents in 2009.
"The outlook for the NRW Holdings… is optimistic and we look forward to continuing our strong growth profile during the 2011 financial year," the company said in its statement yesterday.
"The 2010 financial year result was pleasing given the competitive market experienced since the Global Financial Crisis and more recently continuing as a result of the proposed Resource Super Profits Tax.
"Uncertainty and a lack of confidence in the sector had a significant impact through delays in new projects commencing, and the effect of downward pressure on margin.
"NRW has successfully grown the business through a difficult operating year and diversified the Group’s services to encompass the addition of significant new capacity and capability in our Civil business unit.
"We see demand for civil and mining services becoming robust in the second half of FY11 with expectations of high demand for services continuing through FY12 and beyond," the company said in yesterday’s statement.
NRW said the company was "conservatively geared, generating strong cash flows with strong return on capital".
"We have the capacity for strong growth into FY11/12 contingent upon prevailing market influences," the company said.
"Revenue growth for FY11 is expected to be in the range of 15 per cent – 20 per cent with continuation of a tight margin environment."
But for Sydney contractor to mining and construction, AJ Lucas, the end of the 2010 financial year couldn’t come fast enough.
Earnings downgrades, losses, management turnover, arguments with clients made it a rotten year, or as the company described it yesterday, a "disappointing" year of "uncertainty and project delays".
But, like so many companies suffering a dip in earnings (NRW and Beach today, for example) AJ Lucas sees an improved outlook in the current financial year, as activity returns to the mining sector.
The company posted a net loss of $7.13 million in the 12 months to June 30, down from $103.25 million in the prior year.
Unlike the market reactions to Beach and NRW in yesterday’s positive market, investors didn’t give the thumbs up to AJ Lucas, they sold the shares off.
They closed down 3.7%, or 7.5c at $1.955 yesterday.
Total group revenue declined by 28.2% to $358.5 million in 2009-10, from $499.2 million in the prior financial year.
No final dividend was declared after the loss, against the 5.5c a share paid as a final in 2009.
"In line with previous guidance to the market, AJ Lucas’ underlying EBITDA was a negative $4.6 million (previously $37.1 million profit)," the company said yesterday.
"Offsetting the downturn in operational earnings was the successful sale of the ATP651 license area for $98.5 million delivering AJ Lucas with a profit from this investment of $93.0 million.
"This was partially offset by impairment costs of $39.2 million principally relating to other oil and gas investments..
Chief executive Allan Campbell said continued business uncertainty and project delays had impacted on the company’s results.
"The Company’s Building, Construction and Infrastructure Division performed poorly and senior management in this division has been replaced," he said in the statement yesterday.
Mr Campbell said the market remained cautious about approving new projects or expansions.
"Continued volatility in international energy prices and doubts about the sustainability of the global economic recovery, together with delays in environment approval being granted, have all added to the caution in reaching final investment decisions for major projects."
However, Mr Campbell said there was positive signs regarding decisions for major Australian coal seam gas projects and a return to significant activity in the mining sector.
"Request for tenders remains very strong for such projects and we therefore expect final investment decisions to be made quite soon by several of the CSG proponents
