Leighton buoyant after 37pc profit

PUBLISHED : Thursday, 15 August, 1996, 12:00am
UPDATED : Thursday, 15 August, 1996, 12:00am

Australian construction group Leighton Holdings, which has a substantial presence in Hong Kong, has reported a 37 per cent surge in net profit to A$70.2 million (about HK$420.5 million) for the year to June.

'The directors expect an exciting period ahead. Operating profit should continue to improve based on an increase in revenue from Australia and Asia, and the strong underlying performance of the group's operations,' chief executive Wal King said.

Profit from the group's Asian operations, which include a $194 million contract to construct the aviation fuel service facility at Chek Lap Kok airport, rose over the year, although total revenue dropped from $528 million to $489 million.

'The Asian region continues to thrive. Strong economic growth is forecast in all of the countries in which the group operates and the record level of work in hand will translate into increased activity next year,' Mr King said.

'Hong Kong should stay busy as there are a number of large projects likely to come on stream over the next few years. We are expecting little change in the operating environment post-1997 and see the potential to open up new opportunities for Leighton in China.' Rob McWilliams, construction analyst at Sydney-based McIntosh Securities said: 'The company is in very good shape. It has low gearing, an order book of close to $4 billion and a positive outlook for the next few years.' Sentiment towards the stock was also buoyed by news that the group had won the tender to build a $600 million tollway through Sydney's eastern suburbs.

The group had consolidated its presence in Malaysia and Vietnam during the past year and maintained a stable workload in Thailand.

'Indonesia also has the potential to benefit from further resource development projects in the medium term,' he said.