Renewable energy projects power Raubex profit
Eskom’s independent power producer’s programme has boosted the construction group in its six months to end-August Road-builder Raubex is optimistic that the outlook for SA’s construction sector could improve, having received a boost in its six months to end-August from contract work for independent power producers (IPPs).Revenue in the group’s infrastructure division, which focuses on renewable energy, grew 21.4% to R1.28bn, with operating profit surging 187.8% to R77.3m, it said on Monday. The company also reported consistent results in its affordable housing and commercial building operations. Group revenue fell 1.9% to R4.4bn, with revenue from its roads and earthworks division declining 7.7% in which tough trading conditions due to decreased public spending continue to weigh. Industry peers, including Group Five and Basil Read, have entered into business rescue, but Raubex said on Monday it is encouraged by tender opportunities, including for extensive upgrades to the N2 and N3 network in KwaZulu-Natal. Headline earnings per share (heps) rose 64.1% to 58.6c, with the company upping its interim dividend 83.3% to 22c per share. “Following a very difficult 2019 financial year in which a number of rightsizing initiatives where undertaken, we have managed to stop the bleeding and the group is now better positioned to manage the lower volume of construction work on hand, while it has maintained sufficient capacity to participate in an anticipated improvement in the sector,” CEO Rudolf Fourie said. “We are encouraged by a substantial increase in tender activity that has been observed in recent months which now needs to materialise into contract awards,” Fourie said.