Adrian says the company’s continued success is because of the hard work of its people during a challenging year.
Aveng celebrates its second consecutive year of profitability, despite facing various challenges in the reporting year. The company saw a revenue of R26.2 billion for the financial year ended 30 June.
“We are pleased with the results in the context of the operating environment. Our people have put in tremendous effort over a challenging year,” says CFO Adrian Macartney.
He explains that Covid-19 remained a challenge throughout the year, particularly in Southeast Asia, where travel restrictions hampered Aveng until April 2022. “In South Africa, the July riots, a steel industry strike and the KwaZulu-Natal floods impacted our operations.”
He adds that the Russian war on Ukraine and Covid-19 also continue to disrupt global supply chains and cost escalations need to be managed.
Despite these challenges, Adrian explains that the teams in the McConnel Dowell, Moolmans and Trident Steel businesses remained focused on winning work, delivering operationally and controlling costs. “We are pleased with our growth in revenue in McConnell Dowell and Trident and pleased with improved margins in all these businesses.”
He adds that cash generation also remained strong throughout the year, and that Aveng is pleased with the continued de-risking and debt reduction of its balance sheet.
Aveng’s sale of its Trident Steel business is close to completion and will allow the company to extinguish all term debt on its balance sheet. “This will be an important milestone,” Adrian explains.
The company also has its eyes on further growth, and Adrian explains that Aveng has started tendering in Southeast Asia again, which will add to growth beyond 2023.
“Our markets in Australia and New Zealand are strong and we have secured excellent growth in our order books as well,” he says. “From a Moolmans perspective we have some great opportunities and a clear path to improving revenues over the next couple of years with longer term contracts that will allow us to reinvest in our heavy mining equipment.”
Adrian explains that Aveng will continue to focus on growing revenues, improving operational performance and delivering cash flows. “In our view, the stock is undervalued and we will continue to explore opportunities to unlock this value,” he concludes.
