Civil unrest gnaws on Stefanutti’s interim profitability

Civil unrest gnaws on Stefanutti’s interim profitability





JSE-listed construction group Stefanutti Stocks says its results for the six months ended August 31 were negatively affected by civil unrest earlier in the year at the group’s coastal and inland operations, resulting in damages and delays to 17 projects.

The direct financial impact of this was R8-million for which the company is assessing possible claims.

Stefanutti, nevertheless, posted a R5-million interim operating profit, compared with a restated interim operating loss of R161-million in the six months ended August 31, 2020.

Revenue from continuing operations in the six months under review totalled R3.2-billion, an increase from the R2.6-billion restated revenue posted for the prior comparable period.

Stefanutti posted a loss a share and headline loss a share for total operations of 112.69c and 67.12c, respectively, against a loss a share and headline loss a share of 147.04c and 128.42c, respectively, in the prior comparable period.

Owing to the impact of both Covid-19 and current dispute resolution processes, including claims related to the Kusile power station project, cash of R141-million in the reporting period was consumed by total operations and, resultantly, led to a decrease in the company’s cash position from R756-million as at February 28, to R531-million as at August 31.

CEO Russell Crawford says the company continues to progress its restructuring plan, which is aimed at ensuring an optimal capital structure and access to liquidity for long-term growth.

Effective March 1, Stefanutti reorganised its operations into regions, with the exception of the Mechanical & Electrical business, which has been renamed Mechanical Electrical Piping. The regions are now reported as Inland, Coastal, Western Cape, Africa and Mechanical Electrical Piping.

The Inland region’s total order book as at August 31 was R1.8-billion, while the Coastal region’s total order book stood at R1-billion.

In the Western Cape region, Stefanutti has an order book of R555-million, and in the Africa region R1.7-billion.

The company did not declare an interim dividend and continues to process claims related to the Kusile power project.

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