Leighton Holdings Annual Profit Rises 13%

   By Rhiannon Hoyle 
 

SYDNEY--Leighton Holdings Ltd. (LEI.AU), Australia's largest contractor, said its annual net profit rose 13% as it replaced contracts in mining where investment is in a deepening slump with building work from hospitals to hotel resorts.

Sydney-based Leighton has also targeted higher revenues from overseas as it looks to rebuild credibility with investors after several difficult years, marred by delays and cost overruns on major Australian infrastructure projects.

Leighton reported a net profit of 508.7 million Australian dollars (US$458.0 million) for the year through December, up from A$450.1 million in 2012. It maintained its final dividend 60 Australian cents a share.

Australia's resources companies have closed mines, delayed projects and laid off workers to protect profits from falling commodity prices and a strong Australian dollar. That has hurt mining services companies such as Leighton, which specialize in running projects on behalf of the mine owners or carrying out engineering work. Leighton said its work pipeline had fallen 3% on year.

Leighton said its full-year underlying earnings rose to A$584 million from A$448 million a year earlier. That was underpinned by an increase in the company's full-year net margin to 2.4% from 1.9% in 2012.

Leighton forecast a full-year underlying profit of between A$540 million and A$620 million for 2014.

"Improved profitability will be driven by margin expansion initiatives, as top line growth is not anticipated amid the current tough market conditions," the company said.

Write to Rhiannon Hoyle at [e-mail]

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