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MUR - Murray & Roberts - Business Update and Trading Statement MURRAY & ROBERTS HOLDINGS LIMITED (Incorporated in the Republic of South Africa) Registration number 1948/029826/06 JSE Share Code: MUR ISIN: ZAE000073441 ("Murray & Roberts" or "Group") BUSINESS UPDATE AND TRADING STATEMENT The board of directors of Murray & Roberts ("Board") met on 29 June 2011 to consider inter alia the financial results for the current year to 30 June 2011. Following the announcement made to shareholders on 23 February 2011, the Board is pleased to announce that good progress has been made with the resolution of its major projects challenges. * Agreement has been reached with Hitachi on a sustainable way forward that includes final settlement on actual costs incurred by Murray & Roberts in fulfilment of the Medupi and Kusile subcontracts from inception to 30 June 2011. Future commercial arrangements have been agreed and subject to performance, the remaining work on both subcontracts will deliver a margin within the Group`s published strategic range of 5,0% to 7,5%. * Agreement has been reached with Eskom on a process that resolves the scope and cash flow challenges on the Medupi civil works contract. The parties are working positively together to ensure delivery of this contract within an agreed timeframe and budget. * The Gautrain Project is nearing completion and Bombela Concession Company will lodge its arbitration Statement of Claim on or about 30 June 2011 in connection with the Land Deficiencies and related disputes that negatively impacted the contract. These and other initiatives will result in a significant improvement in the Group`s cash position at 30 June 2011, and net debt will be several hundreds of millions of Rand lower than the net debt of R1,1 billion at 31 December 2010. This includes a planned increase of working capital into the Gautrain Project and new working capital demands on a troubled marine project in Australia. The primary factors that have influenced the performance of the Group and the potential financial outcome for the current financial year to 30 June 2011 are as follows: * Ongoing recessionary conditions in the South African and Middle East construction economies, resulting in performance weakness in the Group`s construction, engineering and materials businesses; * Ongoing SA Rand strength; * A difficult marine construction market for Clough in Southeast Asia in the first half-year; * Losses recognised on the Gorgon Pioneer Materials Offloading Facility in Australia, which has experienced scope changes, delayed access and weather delays; * High finance charges due to the funding of working capital; and * A significant improvement in the performance of the Cementation Group. The Group`s order book is steady at about R52 billion, of which about R19 billion relates to remaining works on the South African Power Program. In terms of the JSE Limited Listings Requirements, the publication of a trading statement is required as soon as a company is satisfied that a reasonable degree of certainty exists that the financial results for the period to be reported upon next will differ by at least 20% from the financial results of the prior comparable period. Considering the level of exceptional charges and loss on discontinued operations recorded in the half-year and to date, diluted headline earnings per share and earnings per share will show a loss for the financial year to 30 June 2011. Operating profit, diluted headline earnings per share and earnings per share all from continuing operations will be lower by more than 20% relative to the previous comparable period. More specific guidance will be given once the financial year end review of major projects is complete. The financial information on which this trading statement is based has not been reviewed or reported on by the Group`s external auditors. Shareholders are reminded that Murray & Roberts will publish its preliminary results for the financial year to 30 June 2011 on or about Wednesday 31 August 2011. Bedfordview 29 June 2011 Sponsor: Deutsche Securities (SA) (Pty) Ltd Date: 29/06/2011 14:43:02 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
