re: moving nicely ann now Appendix 4EREVIEW OF OPERATIONSThe...

re: moving nicely ann now Appendix 4E
REVIEW OF OPERATIONS
The past year produced a second consecutive record financial result and saw the Company moving
from a net debt position into a net cash at bank position at 30 June 2004. The Company’s balance
sheet is in its best ever shape, cash flows remain strong, the capacity to pay fully franked dividends
has been created and there are exciting prospects ahead. In short, the Company is in a sound
financial position.
KEY FINANCIAL INDICATORS
2004
$000
2003
$000
Sales revenue 48,915 33,601
EBITDA 10,870 7,177
Net profit before tax 8,284 5,220
Net profit after tax 6,930 3,929
Operating cash flow 10,801 8,858
EPS 4.9 cps 2.8 cps
DPS (fully franked) 1.0 cps -
These reported figures reflect continuing strong conditions and performance across virtually all
sectors in which the Company operates. Sales revenues were up 45% from the previous year while
EBITDA increased 51% to $10.9 million and net profit before tax increased 59% to $8.3 million. Net
profit after tax of $6.9 million received the benefit of a $1 million one-off tax credit resulting from
the adoption of the tax consolidation regime.
The Company’s second half pre-tax profit was $3.9 million as compared to the first half pre-tax profit
of $4.4 million. As further explained below, the difference relates entirely to exchange gains and
losses and ignoring their impact, the second half result was marginally better than the first half result.
Trading conditions continue to be buoyant and the outlook is positive over the next several years. In
the Company’s overseas oil and gas operations it has work on hand until late 2007; in the Australian
resources sector it is well placed to continue benefiting from significant levels of forecast new
investment in major projects; on the east coast of Australia the business is expanding rapidly and in
the Western Australian housing sector activity is similar to that experienced during the pre-GST
boom.
These conditions point to continuing growth for the Company over at least the medium term, whilst
it must be acknowledged that, due to the nature of contracting, there will likely be some short term
fluctuations in profitability during changeover phases when old contracts wind down and equipment is
remobilised to new projects.