Companies And Markets
South African firm WBHO seeks UAE contracts
Published Wednesday, February 24, 2010
South African construction firm WBHO gave a cautious outlook for the next two years as the World Cup boom played itself out and said it was eyeing new government infrastructure contracts and the Gulf to rebuild growth.
The company said it was seeking contracts in the UAE and had set up offices in Abu Dhabi and Qatar.
WBHO, which has completed three stadiums for this year's tournament, posted a 19 per cent rise in first-half profit but said it had experienced a slowdown in contracts being awarded. The company said its order book stood at 13.1 billion rand (Dh6.2bn) at the beginning of 2010 versus R15.3bn at June 30. The government has set aside R846bn for infrastructure work. "I think they are not as buoyant as before," said Stephen Meintjes, an analyst at Imara SP Reid. "I think the key issue is how long it takes [South Africa's] Government to roll out those orders in the R846bn [(infrastructure development] programme announced in the budget." He added that it was "a matter of time" before WBHO received new orders through the programme. WBHO shares rose 2.07 per cent at R103.50 by 0802 GMT, outperforming a 0.34 per cent firmer JSE all-share index. WBHO said headline EPS grew to 839.6 cents, at the top of its forecast of a 15-20 per cent rise. Chief financial Officer John Abbott said the company would produce good full-year results.
Abbott said competition was quite fierce in the region. "We are hoping to get something during this year, but conservatively it might take a bit longer," he said.
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