The result was broadly in line with the prior corresponding period, and Brierty has continued to win contracts and performing its work profitably despite highly competitive conditions across the sector.
Revenue for the half was down around $A12 million to $135.8 million, principally reflecting the transition phase for the mining division as work concluded at the troubled Karara magnetite iron ore project in Western Australia’s Mid West region for Gindalbie Metals and Ansteel and ramped up at Brierty’s $300 million contract at the Western Turner Syncline Stage 2 Project for Rio Tinto.
Brierty managing director Peter McBain said the company had performed well in a difficult environment and remained busy on a number of major contracts.
“It was by no means an easy six months for us, and it is testament to the hard work and resilience at Brierty that we have continued to win quality work at both large and small projects in what is a very competitive market,” McBain said.
“The diversity of work we perform, our ability to deliver successful outcomes at projects, and Brierty’s strong relationships with key clients all ensured we delivered another solid result.”
Brierty was active on a number of civil projects, including three major road projects – upgrades to Great Eastern Highway and Great Northern Highway in regional WA, and construction of Airport Drive at Perth Airport.
Brierty continued to perform civil works for major land developers in WA and the Northern Territory, as well as smaller projects including for local government and resources companies.
The mining division was in a period of transition during the half at Karara and in the Pilbara, and while revenue was down the Western Turner Syncline expansion has picked up with road haulage of ore set to start in the second half of the year.
Brierty’s land development division in the Northern Territory delivered on a number of major milestones in the half at the Mitchell Creek Green development, including completing the first stage of the development.
Brierty also started construction on the second stage of the development during the period, with settlements expected to take place from May 2015.
Brierty’s net debt position increased substantially to $24.9 million, principally through an increase in hire purchase agreements to provide equipment for the Western Turner Syncline Stage 2 project.
Brierty intends reduced debt in 2015-16 as cash generation improves. It expects revenue of around $300 million for 2014-15.
McBain said that although conditions remained highly competitive, there was still work to be won at quality projects.
“There are a number of good civil project opportunities across Western Australia, such as further road upgrades for Main Roads WA, urban land development in Perth and major regional towns, and work at major infrastructure projects,” McBain said.
“While there are fewer opportunities in contract mining, there is still scope for new work which we are targeting.
“Pleasingly, the amount of work in hand at major projects positions us well to deliver stronger revenue in the second half and meet our forecast guidance.
“We already have $150 million in revenue on major projects secured for FY16. This underpins future earnings and we will be working hard to build on that figure during the current half.”