Cimic 9-Months Net Profit Rises by 13%

   By Rhiannon Hoyle 
 

SYDNEY--Construction and mining services contractor Cimic Group Ltd. (CIM.AU) said its net profit increased by 13% in the nine months through September, aided by a strong infrastructure market and improved spending among commodity producers.

Cimic reported a net profit of 564 million Australian dollars (US$398 million) for the nine-month period, and reiterated an earlier profit forecast of between A$720 million and A$780 million for the 2018 calendar year.

The company, which has in recent years expanded by acquiring companies including engineering services company UGL Ltd. and mineral processing company Sedgman, said its pipeline of work totaled A$35 billion, which included new contracts worth A$11.8 billion.

Cimic said its net profit margin was stable at 5.3%.

"We also achieved strong cash generation, and cash conversion of 101% during the last 12 months," Executive Chairman Marcelino Fernández Verdes said. Cimic is majority owned by Germany's Hochtief, which is controlled by Spain's Actividades de Construccion y Servicios S.A. (ASC.MC).

The company has benefited from rising infrastructure spending, particularly in Australia where it continues to bid on new major projects including a metro system in Sydney city.

"The outlook is positive across our core markets, with the expanding pipeline of PPPs boosting opportunities in construction and services, and continued strengthening in mining and mineral processing," Mr. Fernández Verdes said. "Our strong balance sheet provides the flexibility to pursue strategic growth initiatives, capital allocation opportunities and to sustain shareholder returns."

Write to Rhiannon Hoyle at [e-mail]

(END) Dow Jones Newswires

October 23, 2018 02:40 ET (06:40 GMT)

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