INFRASTRUCTURE UNCERTAINTY STALLS SEYMOUR WHYTE

INFRASTRUCTURE UNCERTAINTY STALLS SEYMOUR WHYTE

A SLOWING of the Queensland transport infrastructure market stalled Seymour Whyte's (ASX: SWL) earnings for the half year period to December, with the company now focusing on geographically diversifying Australia-wide.

Revenue for the Brisbane engineering group decreased 18.2 per cent over the period to $123.3 million, while NPAT declined 34.8 per cent to $3.2 million.

While Queensland is still the primary revenue source for the company, contributing 58 per cent of total revenue during the recent reporting period, SWL managing director David McAdam (pictured) says the group has been focused on building a "more balanced business". The company's half year report notes a less than 50 per cent reliance on individual geographies.

New South Wales is the second largest market for SWL, trailing Queensland distantly to contribute 25 per cent of total revenue.

"Seymour Whyte has been undertaking a transformation over the past two years to build a stronger, more competitive, more balanced business," says McAdam.

"Expanded operations enable us to better withstand changing conditions in individual markets and lessen our historic dependence on Queensland transport infrastructure."

A number of new projects supported this including the $86 million Greater Western Highway and $26 million Green Square Trunk Stormwater Project, both in New South Wales. 

This contributes to SWL's total new project wins of $355 million to increase the company's order book to $450 million but its half year report adds that "trading conditions remain challenging".

The company's contestable market in transport infrastructure is now estimated at approximately $9.6 billion between fiscal year 2015 and fiscal year 2019, Queensland contributing $5 billion to this.

However, there is looming uncertainty around the timing of these new projects and "increased uncertainty in Queensland" suggests the tender pipeline could be pushed back. 

SWL's cash position remains strong at $35.5 million, down from $40.8 million on June 30.

The company will pay an interim dividend of 1.75c per share fully franked, down from the previous corresponding of 2.5c per share fully franked.


Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...
Etoro
Advertisement

Related Stories

Former IPO hopeful Limepay acquired by Spenda at a fraction of the $43.5m invested

Former IPO hopeful Limepay acquired by Spenda at a fraction of the $43.5m invested

White-label buy-now pay-later (BNPL) company Limepay may have ...

Melbourne construction safety software group HammerTech receives $105m investment for growth

Melbourne construction safety software group HammerTech receives $105m investment for growth

HammerTech, a Melbourne-headquartered safety intelligence software ...

Here’s how to make sure Indigenous businesses keep thriving across a wide range of industries

Here’s how to make sure Indigenous businesses keep thriving across a wide range of industries

When discussing the creativity and ingenuity of Indigenous people, ...

Brisbane-based IT consultancy Exent acquired by Atturra for up to $8m

Brisbane-based IT consultancy Exent acquired by Atturra for up to $8m

Founder-led IT consultancy Exent is set to join the growing portfol...