| Tue 30 Oct 2007, 12:55 | | MUR - Murray & Roberts - 59TH Annual General Meeti |
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MUR
MUR
MUR - Murray & Roberts - 59TH Annual General Meeting 30 October 2007
MURRAY & ROBERTS HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1948/029826/06
JSE Share Code: MUR
ISIN Code: ZAE000073441
("Murray & Roberts" or "Group")
59TH ANNUAL GENERAL MEETING
30 OCTOBER 2007
BUSINESS UPDATE
The South African construction economy continues to grow faster than GDP
and based on macro-economic commitments from government through ASGISA,
state enterprise and public sector investment programs and the unabated
global demand for natural resources, is in our opinion, set to maintain
this trend for the foreseeable future.
Clough in Australia was consolidated into the Group`s accounts from 1 July
2007 and we are pleased to report that the company has delivered its budget
performance for the first quarter to 30 September 2007. The new chief
executive has set out a clear strategy for the company that primarily
serves the Asia-Pacific upstream oil & gas market.
Mr Harold Clough recently retired as a director of Clough following more
than 50 years on the board of the company. The directors of Murray &
Roberts recognise his significant contribution to both the company and the
Australian construction industry over this period and wish him well in his
retirement.
Globally, resource constraints now play a key role in the planning,
procurement and implementation of capital projects. This challenge is
significantly enhanced in South Africa where the Group has a number of
initiatives to ensure it remains capable of meeting its contracted and
performance commitments as well as to engage new opportunity for growth.
Unpredictable increases in most cost inputs into the construction process
over the past four years have increased financial risks for clients and
contractors alike. While global demand for construction skills and
equipment is likely to intensify, we believe that new capacity investments
will bring stability to local construction materials prices. However, the
increasing costs of transportation logistics between fixed source and
variable utilisation will remain unabated until the country`s road and rail
networks are substantially improved.
Shareholders are cautioned that significant delays are evident in the time
taken by most clients to convert feasibility studies into tenders and then
tenders into contracts. Many contracts commence with inadequate design
information to allow optimum performance. These factors delay the
development of order book and potentially increase risks to both clients
and contractors.
Order Book
The Group project order book was stable at about R 22 billion at 30
September 2007, including AUD 750 million in Clough. The current reservoir
of project opportunity registered within the Group`s Opportunity Risk
Management pipeline amounts to more than R 85 billion in about
120 projects. This is ample evidence of the forward potential evident in
all the Group`s domestic and international markets, including work
associated with South Africa`s power generation program for which no major
contracts have yet been awarded.
There is increased activity evident in the Group`s construction materials
and fabrication and manufacturing operations, while a general slowdown in
consumer demand has dampened performance in the building materials
operations.
Prospects
First quarter trading in the Group has continued from the benchmark set
through the previous financial year. There is, however, some weakness in
the industrial engineering market and the strong SA Rand is impacting the
translation of international earnings.
The Directors meet at end-November 2007 to consider and approve the Group`s
first quarter financial results and revised budget assessments for the year
to 30 June 2008. A trading statement will be issued thereafter should this
be necessary in terms of the JSE Listings Requirements.
Johannesburg
30 October 2007
Sponsor
Merrill Lynch South Africa (Pty) Ltd
Date: 30/10/2007 12:55:38 Produced by the JSE SENS Department.
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