On 11 October 2018, RCR Tomlinson Limited (ASX: RCR) announced that along with its design partner Opus International Consultants Limited, it has entered into an Interim Project Alliance Agreement with City Rail Link Limited for the purpose of caring out project services on the Auckland City Rail Link Project. After the release of this news, the share price of the company decreased by 2.632 percent as on 11 October 2018.
RCR and Opus International are in Joint Venture as Systems Integration, Testing and Commissioning Alliance (SITC). SITC is planning to work together with City Rail Link, Auckland Transport and Kiwi Rail in order to prepare an alliance proposal for the C7 Rail Project. If the proposal of SITC gets accepted, SITC will enter into a Project Alliance Agreement with City Rail Link and Kiwi Rail for the construction alliance phase, which is expected to start in June 2019. The proposed C7 Rail Project includes the provision of track, track slab, overhead line, signaling, control systems, communications systems, control room fit-out, trackside auxiliaries, and building work. [optin-monster-shortcode id=”wxhmli4jjedneglg1trq”]
In FY 2018, the Sales Revenue from Continuing Operations increased by 58.2% to $1,998.5 Mn over the prior corresponding period. The increase in revenue can predominately be attributed to the progress of a number of large-scale solar farms. Due to cost overruns on the Daydream and Hayman Solar Farm projects resulting in cumulative write-downs of approximately $57 million from the original tendered margin, the underlying EBIT from Continuing Operations decreased to a loss of $4.2 million which was $41.2 million in FY 2017. The company was having a net cash of $54.8 million as on 30 June 2018. Due to the commencement of a number of projects, the energy business revenue increased by 21.4 percent to $228 million. The energy business continues to increase its profile and has a strong pipeline of opportunities for gas-fired power plants and biomass-fired boilers in Indonesia, Australia, and New Zealand. Driven by the company’s net proceeds from the capital raising of $87.9 million, the net assets of the company increased to $380.9 million.
The Company is focusing on new rail and transport opportunities by developing strategic partnerships with leading transport solution providers, Company’s joint venture with Downer is one of the examples of its strategic partnership. The company is seeking to improve its safety performance to achieve its goal of an injury free workplace. The ‘R U safe’ program of the company is fundamental to the Company’s future success. A constant focus is required across all levels of business to ensure that the Company meets its desired objectives of ensuring that all staff, suppliers, and subcontractors return home each night incident and injury free.
In the last six months, the share price of the company decreased by 67.92 percent from $2.961 to $0.950 as on 10 October 2018. RCR’s share traded at $0.925 with a market capitalization of circa $252.36 million as on 11 October 2018 (AEST 4:00 PM).
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