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SPENDING 12 months riding a down-turning industry, Watpac Limited (ASX: WTP) has emerged a little bruised, yet not completely out for the count, following its full year result.
Posting a statutory loss after tax this morning of $21.4 million, down from an $11.5 million loss in FY15, the Brisbane giant admits its result was once again affected by the volatility faced by its mining and civil segment.
However, Watpac chair Richard McGruther notes that a slightly improved revenue of $1.2 billion, supported largely by the company's construction segment, hoisted Watpac back to its feet to close out the year.
"As previously reported the group's mining and civil business recorded a number of impairments in the first half of the reporting period, however the business unit has pleasingly returned to profitability in the second half of the financial year," says McGruther.
"The construction business continued to operate profitably and achieved a solid return on equity in FY16 despite the impact of two significant loss-making projects."
Watpac's mining and civil revenue fell to $166.5 million from a previous result of $284 million, while construction project revenue buoyed at $1.04 billion, up from the FY15 result of $929 million.
McGruther is optimistic that Watpac won't be going down with Australia's mining ship, and instead will focus on its more profitable sectors in the year ahead.
"We have recognised the changed dynamics of the resources sector and tailored our business to suit these market conditions accordingly," he says.
"Despite the challenges faced in FY16, we have made substantial inroads on many of our objectives, aimed at creating long-term value for all of our stakeholders."
Referring to a number of new projects on the horizon within varied sectors, managing director Martin Monro (pictured) says the future looks brighter.
"We have strengthened our place in a number of sectors including health, education, defence & secure environments and the delivery of social infrastructure through Public Private Partnerships," says Monro.
Significant projects underway for Watpac include the Victorian Schools PPP, the Ryde Garden residential development in Sydney and the Mary Lane hotel and residential precinct in Brisbane.
Watpac also recently won the title of Project of the Year for its delivery of 180 Ann Street in Brisbane, awarded by Master Builders.
No dividends have been declared for the FY16 period.
Watpac is currently trading at around 80c on the ASX, down almost 15 per cent from opening at 94c.
READ MORE FROM WATPAC:
- Brisbane's project of the year: setting a new standard
- Watpac scores $47m Melbourne tower
- Watpac locks down Ryde Garden contract
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