Shares in engineer contractor, the Perth-based Monadelphous Group (MND), jumped by nearly 7% at one stage in trading yesterday after it revealed a market forecast-beating net profit for the full year ending in June.
The early surge came despite a cut in the final dividend to 63 cents a share, down from 75 cents in 2012-13.
That took the total payout for the year to $1.23 a share down from $1.37 previously.
The company, which operates in the resources, energy and infrastructure sectors, reported a 6.3% in full year profit to $146.5 million.
But that beat market forecast of $137.5 million.
But the initial enthusiasm eased as the day went on and the shares closed 6% higher at $16.39.
MND 1Y – Monadelphous looks to LNG and CSG
The result was achieved on a 10.9% slide in revenue to $2.3 billion.
Monadelphous said a softening in the mining sector had been partially offset by growth in work in the LNG and coal seam gas sectors around the country.
Managing director Rob Velletri said the company had continued to focus on improving productivity to ensure it remained competitive in the tighter mining sector.
He said the company had achieved annualised cost savings of $53 million across the company during the year.
Mr Velletri said the company had won $1.8 billion in new contracts and contract extensions in the 2013-14 year, including the company’s biggest ever construction job – a $680 million contract on the Ichthys LNG project offshore of Darwin.
"More than 70 per cent of the new contracts are in oil and gas, highlighting the success of the strategy to position Monadelphous as a leading construction and maintenance provider to the energy market," he said in the statement.
The company said it ended the year with cash reserves of $180.8 million, up 29% on the previous year.
Mr Velletri said the company could use the cash for new acquisitions.
