1Q21 NPAT $100M; GROUP REVENUE1 $3.4BN
FREE OPERATING CASH FLOW2 PRE-FACTORING IMPROVED BY $106M ON 1Q203
STRONG BALANCE SHEET POSITION; $3.7BN OF LIQUIDITY
NEW WORK4 OF $3.5BN, UP $1.2BN YOY; WIH5 OF $30.2BN
FY21 NPAT GUIDANCE $400M TO $430M MAINTAINED
CIMIC Group today announced its financial result for the three months to 31 March 2021:
- NPAT of $100m
- Solid revenue and profit compared to 1Q20 which had no material impact from COVID-19
- Consistent Group revenue of $3.4bn, on a comparable basis6
- Increased EBITDA, EBIT and PDT margins7 of 10.0%, 7.0% and 5.5% respectively, supported by cost reduction initiatives. Stable NPAT margin7 at 4.6% despite impact of tax and minority interests
- Free operating cash flow pre-factoring improved by $106m compared to 1Q20
- Also improved operating cash flow pre-factoring QoQ, compared to prior comparable3 period
- Strong balance sheet position supported by investment grade rating; $3.7bn of liquidity
- Net debt8 position of $(215)m due to seasonality and $184m reduction in factoring
- Signed a $1.4bn three-year syndicated performance bond facility in 1Q21, reflecting strong financial position, addressing strong tender pipeline
- Moody’s strong investment grade credit rating (Baa2/Outlook Stable) confirmed in January 2021. S&P revised its rating (BBB-/A-3/Outlook Stable) in March 2021
- New work of $3.5bn in 1Q21, well positioned to recover to a more normal level in FY21
- Total work in hand of $30.2bn, up $1.2bn year on year, well diversified across Construction, Services and Mining
- As at 31 March, the pipeline of relevant tenders to be bid on / be awarded is approximately $520bn for the remainder of 2021 and beyond, including around $130bn of PPP opportunities
- Outlook across the Group’s core markets remains positive
- Numerous stimulus packages announced by governments in core Construction and Services markets with additional opportunities through strong PPP pipeline
- FY21 NPAT guidance of $400m-$430m maintained, subject to market conditions.
CIMIC Group Executive Chairman and Chief Executive Officer Juan Santamaria said: “We achieved an improved performance for the first quarter on a like for like basis, with revenue growing in the Australian Construction segment and the Services segment reporting a pick-up in operations and maintenance work.
“Cash flow in Australian Construction improved quarter on quarter and was steady from our Services segment.
“Year to date we reduced our factoring balance by $184 million and our supply chain finance balance by $39 million. Greensill’s current financial circumstances have no impact on CIMIC.”
CIMIC was awarded new work of $3.5 billion during the quarter, bringing work in hand to $30.2 billion. Project wins during 1Q21 included:
- Country Regional Network, NSW - $1.5 billion
- Copperstring 2.0 ECI, QLD - $7 million (potential for $1.7 billion)
- Gippsland Rail Upgrade, VIC - $124 million
- Bruce Highway Upgrade Section D, QLD - $289 million
- Ferny Grove Central development, QLD - $100 million
- Several maintenance contracts in the power sector, across Australia.
Mr Santamaria said: “We are well positioned in growth markets, with attractive tailwinds from the COVID-recovery infrastructure spending and a backlog of services and maintenance work.
“Our focus continues to be managing working capital, generating sustainable cash-backed profits and taking a rigorous approach to tendering, project delivery and risk management.”
Refer to ‘Analyst and Investor Presentation’ for further information here.
1 Group revenue includes revenue from joint ventures and associates
2 Free operating cash flow is defined as net operating cash flow less net capital expenditure for property, plant and equipment. Operating cash flow includes cash flow from operating activities and changes in short term financial assets and investments before interest, finance costs and taxes
3 1Q20 reported cash flows have been adjusted to be on a comparable basis, to reflect Thiess as a 50% equity accounted JV
4 New work includes new contracts and contract extensions and variations, including the impact of foreign exchange rate movements and other WIH adjustments
5 WIH includes CIMIC’s share of work in hand from joint ventures and associates
6 Comparable periods have been adjusted to reflect Thiess as a 50% equity accounted JV in the P&L
7 Margins are calculated on revenue (‘statutory revenue’) which excludes revenue from joint ventures and associates
8 Net (debt)/cash includes cash and equivalent liquid assets (which includes cash, cash equivalents and short term financial assets and investments)