Securing an expanded NSW Government cleaning contract has proven a major fillip to Transfield Services’ burgeoning contracts’ book. In releasing its first half results yesterday, Transfield Services reiterated its full year guidance target, confirming it has record contracted revenue and delivered key elements of its strategy despite continuing tough conditions.
Normalised Net Profit After Tax (NPAT) was $27.6 million for the half year ended 31 December 2010. Including non-recurring items reported NPAT was $14.0 million, as a result of one-off restructuring costs of $7.3 million and transaction costs relating to the Easternwell acquisition of $6.3 million.
Contracted revenue finished the half at a record level of $11.9 billion. CEO Peter Goode, said: “Despite a difficult period, we are pleased to report that momentum in the business has begun to build, reflected in our record contracted revenue of $11.9 billion.
“We have secured a further $1.2 billion of work since 31 December 2010 and have a pipeline of more than $30 billion in opportunities across our markets as we continue to strengthen business development and pursue sustainable growth.”
“We continued to execute on our strategic objective to be more involved at the front end of major resource projects with the acquisition of Easternwell. This positions us as Australia’s leading oil and gas service provider and provides a platform to pursue higher margin, higher value-add contracts in this key growth sector.”
In the Australia and New Zealand region, significant work was secured with new and existing long-term clients, including Amcor Australasia, the Western Australian Department of Transport, Sydney Water, Australian Rail Track Corporation, Housing New Zealand and Chorus in New Zealand. Work volumes in the New Zealand business continued to be strong.
Total revenue in the Americas region (including contributions from joint ventures) increased by 9.4 percent in local currency terms, driven by increased volumes of work due to stabilising economic conditions. Business streamlining and contract optimisation initiatives are also delivering results.
The FT Services joint venture continues to expand its position in Canada with the extension to the Suncor asset management contract for five years for CAD$2 billion. The joint venture also expanded its client base with the award of the maintenance contract with Nexen Inc as well as pursuing an expanding pipeline of opportunities.
During the half, Transfield Services’ Middle East and Asia business secured more than $50 million in wins and renewals with clients including Gasco (Abu Dhabi Gas Company) and Takreer (Abu Dhabi Oil Refining Company).
Since 31 December 2010, the company has secured more than $1.2 billion in new work, including a 10-year contract with South Australia Water valued at $550 million (50 per cent share of joint venture) and a five year $540 million contract with the New South Wales Department of Services, Technology and Administration.
Expanded NSW education contract footprint
Earlier in February Transfield Services reported it had signed a $540 million contract with long-term client NSW Department of Services, Technology and Administration. Transfield Services will provide facilities management and cleaning services to public schools, TAFE colleges and government buildings to an expanded geographical footprint that now includes the Hunter/Central Coast, North and Western Sydney regions.
The contract is for five years, with the option to extend for a further two years and will take effect on 1 July 2011.
Transfield Services’ CEO, Peter Goode, said today: “This significant expansion of scope with a key government client reflects our ongoing focus on safe and efficient service delivery. It also reinforces our leading position in the provision of property and facilities management services and our ability to build on strong long-term relationships with key clients.”
Transfield Services has provided facilities management services to the Department for a decade, managing the maintenance of primary and secondary schools, technical institutions and special needs facilities.