Concessions business boosts Group Five
Speaking at the company’s annual results presentation in Johannesburg on Monday, Vemer said the outlook for the market was by no means “rosy, but at least the decline has slowed”. He said Group Five had noted a positive uptick in its order book during May and June, with June 30 the end of the financial year.
Despite initial signs of the domestic construction market stabilising, it was Group Five’s Engineering & Construction (E&C) business that tripped up the company’s otherwise solid financial results. Even without the R365-million provision made for a problematic client, E&C’s civil engineering unit would have recorded a core operating loss of R16-million.
The four business units of E&C – building and housing, civil engineering, projects and energy –recorded a core operating loss of R237-million for the financial year, down from a R44-million profit in the previous financial year.
The company was buoyed by a record-breaking performance from its Investments & Concessions business, which saw a 288% jump in core operating profit, to R917-million. This business, which operates a number of toll roadprojects in South Africa and abroad, was, in part, supported by the weak rand, said Vemer.