Transfield Services delivers strategic objectives and organic growth
At the Transfield Services 2011 Annual General Meeting held today, Transfield Services’ Chairman, Mr Tony Shepherd said the Company has executed on a number of its key strategic objectives in the 2011 financial year.
“In 2011, we acquired Easternwell, sold USM and reduced our stake in the Transfield Services Infrastructure Fund to 20 per cent,” said Mr Shepherd.
“All of these initiatives were planned, well executed and strengthen the Company. We are now realigned to pursue higher value business in high growth sectors.”
Taking the one-off financial impacts from these transactions into account, underlying Net Profit After Tax increased by 4.3 per cent to A$100.1 million, consistent with guidance.
“Despite a difficult first half in 2011 which was dominated by the cessation of the government stimulus, we have delivered on our guidance of underlying mid-single digit growth in Net Profit after Tax,” Mr Shepherd said.
The Company also reported record low gearing at 18 per cent as at 30 June 2011.
“Earlier this month, Transfield Services announced an on-market share buy-back, as the Board considers the current share price does not reflect the Company’s fundamental value,” Mr Shepherd said.
This decision reflects the Board’s confidence in our ability to continue to build the business and create shareholder value.
The buy-back will be EPS accretive and will achieve the Company’s objectives of ensuring an efficient capital structure, while maintaining sufficient balance sheet flexibility to continue pursuing growth initiatives.
“Transfield Services has a strong balance sheet, giving the Company the capacity to assess growth opportunities that align with or enhance our strategy, in addition to the buy-back,” Mr Shepherd said.
The Company secured more than A$5 billion worth of new and renewed contracts during the period and the total pipeline of opportunities at the end of the financial year was nearly A$29 billion.
“The last financial year has been a story of carefully and systematically building scale and capability in our business development function – and we have won significant new work as a result, as we continue on our path of organic growth,” said Transfield Services’ Managing Director and CEO, Mr Peter Goode.
“Divesting the low value areas of our portfolio has allowed us to focus on growing our presence in key sectors where we see sustainable future investment, including oil and gas, resources and infrastructure.
“Transfield Services is now the leading oil and gas well servicing and maintenance operator in Australia. This positions us at the front end of Australia’s burgeoning resources industry,” Mr Goode said.
For FY12, Transfield Services is maintaining its guidance of operational NPAT of $130m – 135m preamortisation, subject to no deterioration in economic conditions and USD/AUD parity. Due to normal seasonality and the ramp up of recent contract wins, this will be achieved with a skew to 2H FY12.
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Transfield Services employs over 19,000 people across 18 industries and 10 countries.
We are a global provider of operations, maintenance and construction services to the Resources, Energy, Industrial, Infrastructure, Property and Defence sectors.
We deliver asset management services across all phases of the asset lifecycle, from concept and creation, to services that sustain, optimise and enhance our Client’s assets. With diverse global experience and expertise, we share our knowledge and challenge thinking to develop and implement innovative solutions that deliver real value for our Clients. Our unique approach enables us to deliver continuous improvements in asset performance and sustain long term relationships with our Clients and partners.