Civil engineering and construction group Sanyati Holdings on Tuesday said government contracts and extending operations beyond KwaZulu-Natal had boosted its order book, positioning the black economic empowerment company to achieve its forecast net profit of R53 million for the 2007-08 financial year.
The order book included a R25 million contract for civil infrastructure work in Polokwane, a R75 million road rehabilitation contract in Gamtoos, Eastern Cape, and a R1,9 billion contract for civil works on the new King Shaka International Airport in Durban.
Releasing the company’s results for the six months ended August, CEO Rick Jackson said the buoyant growth in the construction industry boded well for the firm. He said though 66% of Sanyati’s contracts came from KwaZulu-Natal, he was pleased at the inroads the company had made in Gauteng.
“The Gauteng operations are up and running with (the group’s piling subsidiary) Mega Pile’s first R2 million contract ,” said Jackson.
Gauteng accounted for 22% of Sanyati’s contracts, with the balance split among Mpumalanga, Eastern Cape and Zambia.
In an effort to grow the business , Sanyati said, it had acquired Gauteng-based Ruthcon Civil Contractors and GEM Earthworks, which has operations in Eastern Cape and Mpumalanga.
Net profit for the period under review doubled to R22,9 million on a 105% increase in revenue to R396,2 million — up from R192,5 million.
Cash generated from operations surged to R10,9 million from a loss of R4,5 million. Headline earnings per share increased to 8,74c from 5,73c.
Of Sanyati’s four business units, Civils Coastal was the biggest contributor to overall performance.
Revenue accumulated by C ivils C oastal was R215 million. Its performance was boosted by large-scale projects such as the R117 million tender to construct roads in Barberton, and the R52 million contract to construct a water pipeline in Umgeni, on the south coast.
The unit also stood to gain R190 million over the next 19 months after the Ilembe Consortium was awarded a R1,9 billion contract to build the R6,8bn King Shaka International Airport.
