Raubex’s interim performance improves following rightsizing efforts

Raubex’s interim performance improves following rightsizing efforts

11th November 2019

By: Tasneem Bulbulia
Creamer Media Reporter

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Infrastructure development and construction materials group Raubex is now in a better position to manage the lower volume of construction work available in the market and has maintained sufficient capacity to participate in an anticipated improvement in the sector, CEO Rudolf Fourie said on Monday.

Reporting on the group’s results for the six months ended August 31, Raubex on Monday highlighted the work undertaken during the 2019 financial year, ended February 28, to rightsize the business amid a constrained construction market.

Fourie noted that despite softer results reported by the materials division, the infrastructure division experienced strong growth during the first half of the 2020 financial year, mainly owing to work related to the division’s participation in the Renewable Energy Independent Power Producer Procurement Programme, where a number of contracts are currently in progress.

“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,” he added.

For the six months under review, Raubex’s revenue decreased by 1.9% year-on-year to R4.40-billion, while operating profit increased by 37% year-on-year to R216.3-million.

Headline earnings a share increased by 64.1% to 58.6c and earnings a share by 81% to 64.6c.

Cash generated from operations increased by 41.4% to R414.8-million.

Raubex’s capital expenditure decreased to R145-million from the R197.5-million spent in the first half of the prior financial year.

The order book increased to R9.08-billion from R8.41-billion in the first half of the prior financial year.

The group declared an interim dividend of 22c apiece.