Fulton Hogan lifts annual profit on growing infrastructure spend
Fulton Hogan lifted annual profit 6.5 percent as the privately-held civil construction firm benefited from a growing infrastructure spend across the nation.
Net profit rose to $179.6 million in the 12 months ended June 30 from $168.7 million a year earlier, the Christchurch-based company said in a statement. Revenue rose 8.5 percent to $3.6 billion while earnings before interest, tax, depreciation and amortisation climbed 11 percent to $364.6 million. The board declared annual dividends of 64 cents per share, up from 62 cents in 2016.
"Our New Zealand regional business benefited from strong economic growth and associated infrastructure spend," the company said. "Diversification into new portfolios and market sectors contributed to growth in Australian industries."
Fulton Hogan noted a number of "significant business wins" when reporting a 13 percent increase in first-half earnings earlier this year in an increasingly competitive environment. Construction firms have bemoaned the rapid increase in costs and scarcity of skilled labour in the face of a mammoth pipeline of work, which includes the government's plans to fund $32.5 billion of infrastructure over the next four years.
The company today said its forward order book was strong and it had secured about 65 percent of budget revenue in 2018 without being more specific. It was $1.9 billion in 2017.
Fulton Hogan boosted its workforce to more than 7,150 across New Zealand, Australia and the Pacific, from about 6,300 a year earlier.
However, its total recordable injury frequency rate deteriorated to 5.3 compared to 4.8 a year earlier, and included the death of Selwyn Rewa in Fulton Hogan's Northland team, who was hit by a logging truck at a worksite operating under temporary traffic management.
"This incident is a tragic reminder of the dangers our teams face each day when working in and around live traffic at our many active worksites in New Zealand, Australia and Fiji," chairman Dave Faulkner said. "We remain resolute in our commitment to achieving zero harm and focusing on our safety performance in every part of our workplace environment."
Fulton Hogan's new chief executive Cos Bruyn started earlier this month, taking over from Nick Miller who had been in charge of the firm for the past seven and a half years.