AUSTRALIA

  AUSTRALIA
GROUP MANAGING DIRECTOR: Phil Mehrtens
       
             
      2010
R’000
  2009
R’000
 
  Revenue 4 534 442   4 674 587  
  Operating profit before non-trading items 152 241   124 720  

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AUSTRALIA   AUSTRALIA

REVENUE (Rm)   OPERATING PROFIT (Rm)
REVENUE (Rm)   OPERATING PROFIT (Rm)

OVERVIEW

Although influenced by the Global Financial Crisis (GFC), Probuild’s revenue of AU$640 million was just AU$25 million below the record level of AU$665 million that had been achieved in FY09.

As a result of stronger contract profit margins, the year-on-year profit before tax increased by AU$4,3 million to AU$24,2 million, 21,4% year-on-year earnings growth.

Key projects completed during the year that drove the strong profit result included the commercial centres One-40 William Street, 717 Burke Street and significant extensions to leading retail shopping complexes, Chadstone and Northland.

The procurement of projects has increased significantly as Probuild secured AU$560 million in new projects during the year, AU$340 million (150% higher) than the AU$220 million that was secured in FY09.

PERFORMANCE AND HIGHLIGHTS

Victoria

The divisionís revenue of AU$408 million was AU$18 million above budget, although AU$19 million below the FY09 comparative. There were a number of key projects completed or nearing completion during FY10 including repeat client retail projects Chadstone (AU$152 million) and Northland (AU$102 million), and the commercial office tower and hotel at 717 Bourke Street (AU$195 million). The divisionís largest project, the AU$220 million Myer Retail Store redevelopment, which commenced in April 2008, is on programme and will be completed in November 2010. Probuildís largest residential project the 40-storey AU$102 million Bank Apartments tower, which commenced in February 2009, remains on schedule for August 2011 completion.

There were a number of new projects secured during FY10 including the AU$191 million Harvey Norman and Ikea project, one of Australiaís largest greenfield retail developments, Monash Universityís AU$117 million New Horizonís project as well as the AU$53 million Clara Apartments and AU$46 million Roi apartments.

Western Australia

Year-on-year the division’s revenue increased by AU$13 million to AU$153 million. Probuild’s largest project, the AU$236 million One-40 William Street, achieved practical completion in May 2010, 3-months ahead of programme. The AU$95 million CeVue Apartment project was completed in April 2010.

New projects secured during FY10 include the AU$40 million Department of Housing Cockburn project and the AU$19 million Aspect Apartments multi-storey residential project.

New South Wales

Impacted by a depressed construction market, the division’s FY10 revenue of AU$28 million was AU$12 million lower than the FY09 Comparative. Projects completed during FY10 include the AU$14 million Royal Randwick Racecourse redevelopment and the AU$26 million Milsons Point and AU$18 million Grosvenor Apartments multi-storey residential projects.

Two new multi-storey residential projects were secured during FY10, the AU$17 million Halcyon and the AU$10 million Gladstone Parade Apartment projects.

Queensland

In a highly competitive and depressed market Probuild Civilís revenue of AU$44 million was AU$14 million below the FY09 Comparative. There were a number of smaller projects that were competed during FY10, including the repeat client projects with Main Road at Wynnum (AU$7 million) and QBH (AU$3 million).

The divisionís largest current project, a AU$19 million freeway upgrade at Varsity Lakes, which commenced in June 2009 remains on schedule for a November 2010.

New projects secured during FY10 include repeat customers Joint Leeve Road (AU$3 million), Dohles Road (AU$6 million), Warrego Highway AU$5 million and QBH AU$6 million.

As at 30 June 2010, Probuildís order book is a solid AU$575 million; 90% of the AU$640 million revenue achieved in FY10. In addition to this, Probuild is exclusively negotiating with the developer of the AU$110 million Raine Square project in WA. This project is expected to be secured and commence in August 2010.

MARKETS

Through a combination of Government spending and the strength of the resources sector the Australian Economy appears to have emerged from recession conditions, and well placed for further growth.

In particularly, led by demand for multi-storey inner city residential dwellings, there are encouraging signs of growth in that the construction sector in VIC and WA. The NSW and QLD markets remain flat.

PROSPECTS

Probuild is currently tracking and pursing AU$4,0 billion in opportunities that have schedule commencement date within the next 12-months. Predominately these prospects are in the retail, educational and resident sectors.

At the same time last year Probuild was tracking AU$2,2 billion. The significant 80% increase in prospects is representative of the underlying emerging post GFC optimism currently being experienced by most sectors in the Australian economy.

AUSTRALIA

AUSTRALIA

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