Raubex rallies on rising order book

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Raubex rallies on rising order book

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Published Date: 2021-05-11 | Source: Stephen Gunnion | Author: Stephen Gunnion

Raubex rallies on rising order book

The construction and road-building group has reported a strong second-half recovery as it bulks up its order book.

Raubex has reported a big increase in its order book due to a number of big contract wins, sending its shares more than 6% higher at their best yesterday. It also experienced a significantly better second half to its financial year after posting a loss in the first six months.

Releasing results for the year to 28 February, the construction and road-building group said it had shown resilience over the past year with its ability to navigate through tough industry conditions and unforeseen challenges like the Covid-19 pandemic.

It grew its secured order book by 69% to R17.1-billion and said unsecured contract opportunities that it had tendered for were also significant and would benefit the construction and materials supply sides of its business. Its infrastructure division was well positioned to participate in the Risk Mitigation Independent Power Producers Programme and had also continued to establish itself in the affordable housing and commercial building sector.

Having secured a significant base load of work, its roads and earthworks division was focused on carrying out the contracts while looking for higher margin contract opportunities to supplement the order book. Conditions in the materials division were expected to remain buoyant, with materials handling operations for the mining sector supported by high commodity prices and commercial quarries benefiting from the improvement in conditions in the construction sector.

In the rest of Africa, construction work was focused on the efficient execution of works relating to the upgrading and expansion of Beitbridge Border Post in Zimbabwe. In Western Australia, the construction sector in the country continued to be buoyant and a number of new projects had been secured to support the order book.

Revenue for the year increased by 1.3% to R8.85-billion but operating profit fell 24% to R365-million due to the impact of Covid-19 lockdowns which impacted operations in various jurisdictions in the first half. Earnings per share (EPS) came in 37% lower at 87.4c while headline EPS declined by 49% to 81.9c. After generating cash of R1.33-billion from its operations, up 68% from the prior year, it declared a final dividend of 29c per share.

The company's shares closed 5.3% up at R28.





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