Monadelphous turns to oil and gas as resources projects wane, profit falls
The engineering contractor has booked a 37pc slide in profit as it continues to feel the pain of mining’s downturn.
Engineering contractor Monadelphous is continuing to pivot away from the resources sector towards the oil and gas industry as the mining downturn continues to put pressure on the group.
Monadelphous today booked a profit of $67 million for the year through June, a 37 per cent slide year-on-year. Revenue for the group (MND) was down 27 per cent to $1.37bn.
The tail end of the mining boom has been particularly hard felt by Mondelphous, as work dries up because of companies deferring or cancelling projects.
The company has been pursuing work in new markets to help offset waning demand in Australia for its services.
Monadelphous will pay a final dividend of 32c, bringing the year’s total payout to 50c a share — far below the prior year’s 92c distribution.
“While opportunities for new major resource and energy construction contracts are expected to remain at low levels, we are well placed to capitalise on growing maintenance opportunities, particularly in the oil and gas sector,” chief executive Rob Velletri said.
Over the period Monadelphous secured more than $1.1 billion of new work, with approximately 70 per cent being new oil and gas contracts.