CIMIC Group Limited (ASX: CIM) is an international contract miner. The group is engaged in construction, mining, engineering, mineral processing, operation and maintenance services.
The company today, on 11th April 2019, communicated its financial performance for FY18 at its AGM. The company’s aim of delivering returns, based on sustainable profits which is backed by the generation of cash. It has achieved this target again in FY2018 and delivered excellent returns for shareholders.
The net profit after tax of the company stood at the top end of the profit guidance range, increasing by 11% from the previous year of 2017 to $781 million. The revenue for the period was $14.7 billion, with all of the operating companies recording growth. CIM’s margins were stable, driven by a diligent focus on project delivery and cost discipline.
Cash flow from operating activities was strong, an increase of 22% to $1.9 billion, driven by the project performances of the company, complemented by smart working capital management. The strong cash generation led to an increase in the net cash of more than $700 million, to $1.6 billion as at December.
The financial policy of the company is to manage net debt to a level that supports a strong investment grade rating. The gross debt of the company stood at the lowest level since the year 2007. On the back of these strong metrics, the Board of the company has declared a final dividend for 2018 of $0.86 per share. The payment date for the dividend is on 4th July 2019 and franked at 100%. The total dividends declared for 2018 amounted to 156 cents per share, which is a 16% increase compared to 2017.
The company is well placed for the future, with strong teams of committed, talented and passionate people; leveraging the unique offering that the company has as stated by the CEO of the company, Mr. Wright. The company presents discipline and innovation so that it can lead to sustainable outcomes that benefit the clients of the company, its people and shareholders.
Since the end of 2018, the company won several excellent projects, and the Executive Chairman, Mr. Marcelino Fernández Verdes is happy to confirm that during the last week, Pacific Partnerships, CPB Contractors, and UGL were selected as the preferred proponents to deliver two major packages for Brisbane’s $5.4 billion Cross River Rail.
On the stock performance front, the stock of CIMIC Group Limited was trading at $48.60, decreasing marginally by ~0.512% during the day’s trade, with a market capitalisation of $15.84 billion (At market close on 11th April 2019). The stock opened the day at $48.530, with its day’s low price at $48.490; however, it touched a day high of $49.470. The 52-week high price of the stock stands at $51.670 and a 52-week low at $39.575, with an average trading volume of 303,264. The stock has generated a YTD return of 14.22% and generated returns of 0.58%, 10.07% and -1.99% over the past six months, three months and one-month period, respectively. The stock is trading at a PE multiple of 20.29x.
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