REPORTING SEASON: UGL Limited (UGL)
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Figure 1: UGL Limited 12 month chart
UGL Limited (UGL) posts worse than expected annual loss due to hefty write-downs
– Engineering services firm UGL Limited (UGL) reported an annual net loss after tax of $236.4Million for the FY15 (DTZ sales boosted its bottom line figure by $49Milion).
– The $122.5million provision associated with the Ichthys Combined Cycle Power Plant (CCPP) project was already factored into this result, along with the $55.6Million related to the slowdown in the resources industry, the $63Million of goodwill impairments, and the $26.7Million in restructure charges. Today the company also reported other one-off changes and write-downs to the value of $41Million as the new management team work on recreating a stronger company for the future. The company said “Strong progress was made in reducing WIP in FY15 through the cash settlement of longstanding claims”.
– UGL’s total operating revenue beat expectations. Rail & Defence revenue lifted by 2%, while Asset Services (UGL’s maintenance division) also increased by 2%. On the other hand UGL’s EBIT fell to $8.5Million mainly due to weak demand from the coal sector. UGL’s Engineering & Construction revenue lifted by 21% while revenue from its Technology Services unit fell by over 23% despite a 100% lift in its order book. Technology Systems revenue is expected to be flat in 2016 with Sydney Metro Northwest replacing completed projects in FY15.
– UGLs’ order book now stands as $4.6Billion and is on track to achieve its FY16 guidance of $2.3Billion in revenue and a 4% increase in its earnings margin in FY17.