Strategy

OPERATING MODEL

CIMIC’s mission is to generate sustainable economic returns for shareholders by successfully delivering projects for our clients while providing safe, rewarding and fulfilling careers for our people. Key elements of our strategy are a disciplined approach to risk management and a focus on cash generation, complemented by a strategic approach to capital allocation, always underpinned by an uncompromising focus on safety.

CIMIC has activity-focused businesses in construction, mining, mineral processing, operations and maintenance services, PPPs and engineering. The size of these businesses creates economies of scale and strengthens their position in their respective markets. They are broadly diversified by market sector, activity, geography, type of client, contract type, volume and duration.

Our competitive position and size, combined with our strong balance sheet, puts CIMIC in a robust position to take advantage of growth opportunities, both organic and strategic, in our different markets. The Group’s diversity provides clients with integrated solutions from development to financing to engineering, construction, mining, operations and maintenance. The ability to offer a complementary suite of capabilities, throughout the life cycle of a client’s infrastructure or resources projects, differentiates CIMIC. The Group continuously seeks to expand and leverage these competencies to further develop in Australia, Asia-Pacific and other select geographies.

Crucial to the strategy is the generation of cash-backed profits, and the development of diversified income streams which helps to reduce volatility, and manage risk whilst generating sustainable returns. Shorter-term projects (e.g. construction) are balanced with medium-term projects (e.g. mining and large scale construction) and longer-term projects (e.g. PPPs, operations and maintenance services, and life-of-mine projects).

Underlying the Group’s activity-focused businesses are common systems and processes. This approach facilitates innovation and the sharing of knowledge, and provides a rigorous governance framework. Our Principles of Integrity, Accountability, Innovation and Delivery, underpinned by Safety, guide all of the Group’s activities.

ACQUISITIONS, DIVESTMENTS AND INVESTMENTS

CIMIC’s strong balance sheet enables the Group to continue to evaluate acquisition or investment options that complement our capabilities and strategy as opportunities arise. On 6 July 2017, CIMIC’s wholly owned subsidiary CIMIC Group Investments Pty Limited, sold its 23.64% shareholding in Macmahon on the ASX for a price of $0.165 per share, totalling $46.9 million

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