Aveng final results June 2018
Aveng reported a headline loss of R1.7 billion (2017: R.,4 billion) and a net loss of R3.5 billion (2017: R6.7 billion). This loss includes an impairment charge of R2.3 billion relating to the non-core assets transferred to Held for Sale being measured at fair value. Basic loss per share was 653.9 cents loss per share compared to a 1 245.1 cents loss per share (restated) in the comparative period and headline loss per share decreased to 311.6 cents (2017: 1 197.0 cents restated) loss per share.
Revenue increased by 30% to R30.6 billion (2017: R23.5 billion). Excluding the impact of the write-downs on long outstanding uncertified revenue of R5.1 billion in the prior year, revenue increased by 11% mainly due to improved performance at McConnell Dowell throughout its markets. Despite the challenges it has faced, Moolmans saw a 13% increase in revenue. The gross margin for the Group deteriorated to 5.9% from an adjusted 7.2% in the comparative period due to lower margins in Moolmans, Civil Engineering and Manufacturing.
Company outlook and prospects
A great deal has been achieved to date to place the Group in a more stable position. The capital markets transactions concluded in July and September 2018 provide a much-strengthened capital structure and a solid platform from which to advance the strategic action plan to its successful conclusion. In the short to medium term, the Board and Executive management of Aveng will remain focused on accelerating the Group turnaround. This will include the management of the Group's liquidity and the disposal of the non-core assets by the targeted deadline of June 2019. In the interim, Aveng will continue to support the individual management teams to ensure that operational and financial performance is stabilised and optimised at each business unit in preparation for sale.
Going forward as an international infrastructure and resources group, the optimisation of both McConnell Dowell and Moolmans is critical to the success of the Aveng Group. Priorities for McConnell Dowell are to convert ECI opportunities into order book and to win work in its target markets and specialist areas. At Moolmans, management will focus on ensuring that the interventions deliver improved operational and financial performance while business development processes are enhanced. Strong employees are the bedrock of the organisation and, as with any change process, Aveng is cognisant of the impact of the uncertainty that this process has had on employees over the previous year. The Group will continue to focus on ways to rebuild morale and enhance the safety, health and wellness of all employees.