| Fri 26 Oct 2007, 13:18 | | AEG - Aveng Limited - Annual general meeting chair |
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AEG
AEG
AEG - Aveng Limited - Annual general meeting chairman statement
Aveng Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1944/018119/06)
ISIN: ZAE000018081
Share Code: AEG
("Aveng") or ("the company")
ANNUAL GENERAL MEETING CHAIRMAN STATEMENT
The following statement was made by Angus Band, the chairman of Aveng Limited,
at the company`s annual General Meeting held on Friday 26 October 2007.
"Trading conditions in all three of Aveng`s business clusters continue to be
buoyant. The two year construction order book at the end of September of R20,5
billion is 64% up on the R12,5 billion at September 2006, which indicates that
there will be strong revenue growth over the next two years. More importantly,
the risk profile of this order book is much lower than it has been in the recent
past. Strong spending in the mining sector, the South Africa and Australian
governments` commitment to infrastructure development and, in particular, the
bold expenditure plans of Eskom and Transnet should ensure that these favourable
trading conditions continue over at least the next five years.
The margin acceleration plan in Grinaker-LTA, the group`s South African
construction business, is on track to achieve its medium term operating margin
target of 5%. The new management team has settled down well with less `skills
churn` being experienced in the past quarter. While skills are well matched to
the group`s order book, growth capacity remains in all divisions. Moolmans, the
opencast contract mining operation, is returning to its previous levels of
profitability; while E+PC, our engineering and project management services
operation, continues to deliver good margins with excellent prospects for
further growth. McConnell Dowell, Aveng`s Australian based construction company,
continues to perform exceptionally well
As expected, the steel industry and motor components industry strikes had a
negative impact on the quarter`s performance in this cluster. Nevertheless
demand in the Steel and Allied cluster remains good, particularly in the
Steeledale and Infraset businesses which serve the construction industry.
Margins are expected to remain stable during the current trading period.
The group`s executive has been strengthened with the appointment of Mr Juba
Mashaba as group human resources director with effect from 1 October 2007.
Following Carl Grim`s decision to retire next year, good progress is being made
in the search for his replacement and an announcement will be made as soon as
practical.
As a result of the recent growth in Aveng`s share price, there has been a
minimal response to the group`s voluntary share repurchase programme. The
market will be advised on the next step in the capital reduction programme after
the current scheme closes on 2 November 2007 .
With all operating groups projected to perform well over the remainder of the
year, the group remains on track to achieve its medium term operating profit
margin objective of 8%"
26 October 2007
Date: 26/10/2007 13:18:11 Produced by the JSE SENS Department.
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