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Signage at Monadelphous Victoria Park offices. Picture: Gerald Moscarda/The West Australian.
Signage at Monadelphous' Victoria Park offices. Picture: Gerald Moscarda/The West Australian.

UPDATE 1.20pm: Monadelphous shares jumped after the engineering contractor posted a 10 per cent hike in first-half profit to a record $87.1 million despite a miniscule slide in revenue amid the mining slowdown.

Revenue for the six months to December 30 was off just 1.02 per cent to $1.28 billion.

The company lowered its interim dividend by two cents to 60 cents a share fully franked.

Managing Director Rob Velletri said the company had delivered a solid half-year result as the resources market continued to tighten and the unprecedented surge in construction activity moderated.

"In response to the change in market conditions, the company has achieved annualised cost savings of $34 million to date through a program focussed on consolidating and right-sizing the business," he said.

"We have continued to secure new work with approximately $600 million in new contracts and extensions in the first half and a further $100 million subsequent to the reporting period, with additional awards expected in the coming months."

"While mining and minerals markets have softened, bidding activity in the oil and gas market remains high and the company is in a strong position to secure new contracts in both upstream and downstream LNG developments."

Monadelphous said it would continue to focus on managing execution risks, improving productivity and reducing costs to protect margins that remained under pressure in an increasingly competitive environment.

The company maintained its forecast for a 10 per cent decline in sales revenue for the full 2014 year.

Monadelphous held $188.1 million in cash at the end of December compared with $126.3 million in the previous corresponding period.

Shares in Monadelphous closed up $1.51, or 9.69 per cent, at $17.10.

The West Australian

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