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Macmahon chief executive Ross Carroll. Picture: Nic Ellis/The West Australian.
Macmahon chief executive Ross Carroll. Picture: Nic Ellis/The West Australian.

UPDATE 2.40pm: Investors have cheered Macmahon Holdings after the contractor returned to the black with a $30.4 million full-year profit on the back of $1 billion in revenue.

The firm, which is now solely focused on mining after extricating itself from its troubled construction business, said it had an order book of $2.6 billion and had reduced its gearing ratio to 12.9 per cent after repaying $50 million in debt over the period.

Chief executive Ross Carroll said despite difficult market conditions, the company had delivered on its commitment to shareholders to return the business to profitability.

"Our business improvement program has enabled us to maintain our position in the market and reduce the impact of industry factors such as cost pressure and increased competition," he said.

"Our four pillars of success, being safety, business improvement, business development and people have provided us with clear areas of focus, and we are continuing to invest significant resources in these areas to ensure we achieve greater performance moving forward."

Mr Carroll said Macmahon maintained a healthy cash position and was entering the new financial year in a solid position.

"The company generated operating cashflows from mining operations of $125.2 million," he said.

"This represents an increase of 6 per cent on the previous corresponding period."

Mr Carroll said market conditions were likely to remain difficult but the company had an order book of $2.6 billion, which was supported by long-term contracts with blue-chip clients.

"We are also tendering for approximately $2.3 billion of new work, most of which is for projects that are scheduled to commence in the coming 12-18 months," he said.

However Macmahon also announced today it was in dispute with client Erdenes Tavan Tolgoi (ETT) over an overdue $22 million payment for work at the company's coal project in Mongolia.

Macmahon is contracted to 2017 but work has been suspended pending discussions to see whether the matter can be resolved.

Shares in Macmahon closed up three cents, or 27.27 per cent, at 14 cents.

The West Australian

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