Civmec reports 50.1% rise in H1 net profit; declares dividend

CONSTRUCTION and engineering group Civmec reported on Monday (Feb 14) a 50.1 per cent increase in net profit for its fiscal first half ended Dec 31, 2021, on the back of higher revenue.

Net profit for the 6 month period rose to A$22.6 million, up from A$15 million in the same period a year earlier. On a per share basis, earnings had risen to A$0.045 from A$0.03 in the corresponding period previously.

The board of Civmec declared an interim dividend of A$0.01, unchanged from the prior year period.

Sales revenue for the first half was up 27.4 per cent year-on-year, climbing to A$389.4 million. Net profit margin had improved to 5.8 per cent in H1 FY22, compared to 4.9 per cent a year earlier.

In a statement, the group said it had "performed well" across all its operating sectors in H1 FY22, with growth in both top and bottom lines compared to both H1 and H2 of FY21.

The company said it sees "significant avenues for growth" within its maintenance and capital works division in the short to medium term.

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It said it has invested "substantial resources" in this division over the past 2 years, and noted that revenue from provision of services - which are predominantly realised through maintenance work - quadrupled to A$105.4 million in H1 FY22, up from A$26.2 million in the year-ago period.

The company said the outlook for the second half "remains strong", citing an order book of more than A$1.15 billion as at end January, as well as reduced interest expenses, following the paydown of a secured note.

"Civmec's financial performance for the financial year ending 30 June 2022 (is) set to exceed that in FY2021, barring unforeseen circumstances," the company said.

The group's net asset value per ordinary share rose to A$0.6179 as of end-Dec 2021, up from A$0.583 six months earlier

Civmec shares closed at S$0.64 on Monday, down S$0.035 or 5.2 per cent before the earnings announcement.