Why Perenti (ASX:PRN) reported first half loss

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Summary

  • Perenti (ASX:PRN) announced the loss for the first half of financial year 2021 amid challenges due to the COVID-19 pandemic.
  • The company’s underground business growth was counterbalanced by a muted performance from its African Surface mining and Investments businesses.
  • Perenti’s board declared an interim dividend of 3.5 cents per share on 7 April 2021.

Perenti Global Ltd (ASX:PRN) on Tuesday announced the loss for the first half of financial year 2021 amid challenges due to the COVID-19 pandemic, which negatively hit its international operations. Perenti reported a net statutory loss after the tax of A$63.8 million, compared to a profit of A$38.2 million last year. The underlying net profit after tax stood at A$44.6 million, down from A$60.1 million a year ago.

Image Source: © Cmmeraydave | Megapixl.com

The company’s underground business growth was counterbalanced by a muted performance from its African Surface mining and Investments businesses. Perenti recorded revenue of A$1.1 billion, up from A$1 billion in the corresponding period of last year. The underlying earnings before interest, tax, depreciation and ammortisation (EBITDA) stood at A$200.9 million, a 9 per cent fall on the last year’s A$221.8 million. 

Dividend

Perenti’s board declared an interim dividend of 3.5 cents per share on 7 April 2021.

Image Source: © Cmmeraydave | Megapixl.com

Company commentary

Commenting on the earnings update, the company CEO Mark Norwell said that the headwinds due to the coronavirus pandemic, foreign exchange movements and a softening Australian east coast equipment rental market were expected to stay in the second half of FY21. These headwinds resulted in several projects getting delayed during the period under review.

Norwell also said that the company also saw delays caused to the materialisation of contract awards for various other pipeline opportunities. The projects would be slightly delayed, most likely to FY22, he said.

Outlook

The company said that the business would deliver second half FY21 revenue and margins consistent with the results achieved in the first half of FY21, assuming that the USD/AUD exchange rate remained stable at A$0.76.

READ MORE: US Markets End Lower, Weighted Down By Tech Stocks, Consumer Cyclicals

Stock performance 

On Monday, 22 February 2021, the shares of Perenti closed at A$1.43, up 0.050 points, or 3.62 per cent, against the previous closing on Friday, 19 February 2021.

READ MORE: Here’s how SECOS (ASX:SES) made small profits 


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