Fulton Hogan irons out Pacific Highway problems, says 1H 'performed soundly'

The Australian construction business is "positioned to deliver on budget this year".

Fulton Hogan, the privately-held construction firm, says it has ironed out the problems associated with its Pacific Highway project in New South Wales and has recorded a strong first-half result, without disclosing what it is.

The Christchurch-based company resolved contractual matters on the rain-delayed Pacific Highway project, which was seen as one of the major causes behind its 90 percent plunge in annual profit last year. Fulton Hogan took a $27.4 million charge on its associate companies and joint ventures, which included the highway partnership.

Managing director Nick Miller said the company has performed soundly in sales and profitability terms with a strong forward order book, without providing any detail. He previously said forward order book was worth $3.7 billion at the start of the financial year.

"The strategies put in place last financial year continue to position the company well for the future," he says. "We are on track to meet our targets for project delivery, business results and shareholder returns."

Last year, the construction firm delayed its annual meeting until mid-December as it negotiated the details of the problematic Australian project, having already revoked a planned share buyback in October.

This financial year Fulton Hogan slowed its growth aspirations across the Tasman and today said its Australian industries business "significantly enhanced its year-to-date profit" and the Australian construction business was "positioned to deliver on budget this year".

Fulton Hogan sold its Otago forestry holding last year as part of a plan to strengthen its balance sheet and said strong sales at its Halswell and Lincoln residential developments in Christchurch helped reduced debt.

The company had current liabilities of $532.3 million as at June 30 and non-current liabilities of $772.9 million.