Opus International lifts first-half profit on NZ efficiency gains

Opus International Consultants [NZX: OIC], the listed engineering firm, lifted first-half profit 60% on efficiency gains after restructuring its New Zealand office.

Net profit after tax rose to $15.9 million in the six months ended June 30, up from $9.9 million a year earlier, the Wellington-based firm said. Earnings before interest and tax rose 40% to $20 million while sales fell 3.9% to $255.9 million. Last year the company reduced its leadership team to eight from 12 as part of a response to what it said was "an increasingly competitive market."

"It's pleasing to see the resulting efficiency gains, increases in productivity and higher win-rates following a major restructure and performance improvements," chief executive David Prentice said. "While economic uncertainty exists in some markets, the group has responded well and continues to implement initiatives that will improve performance."

The New Zealand unit lifted ebit 34% to $17.6 million, while revenue slipped 2% to $145 million. Ebit for its UK was operations $1.4 million, while sales rose 26% to $33.6 million. In Canada, it turned to an operating loss of $1.2 million, after revenue fell 2% to $52 million, while its Australian operations also reported a loss of $2 million, as sales fell 23% to $26 million.

"Despite moving swiftly earlier in the year to reduce costs and drive efficiencies, Canada and Australia continue to be affected by external economic pressures," Mr Prentice said. "Despite taking early measures to reduce cost, market contraction has been sharp. However, our actions ensure we minimise cost but maintain capability for emerging market opportunities."

The board declared an interim dividend of 4.1c per share, and a special dividend of 2c per share.

Opus shares rose 3.3% to $1.24.

(BusinessDesk)