Leighton on track for another record profit

Issue Date:  16 May 2001
Issued By:  Leighton Holdings Limited

“At the end of the third quarter of 2000/2001, the Leighton Group has maintained its high level of work in hand and expects to report another record profit for the full year,” Leighton Holdings Chief Executive Mr Wal King said today.

“The offshore operations of Leighton Asia and Thiess Indonesia continue to make a strong contribution to this performance,” Mr King said.

“At 31 March 2001, the level of work in hand stood at $7.71bn with incomplete management contracts valued at $391m. This compares with $7.57bn of work in hand and management contracts of $444m at the half year.

“Across Asia the Group has $2.5bn worth of work in hand with an excellent spread across Indonesia, Hong Kong, Malaysia and Thailand.

“Leighton Asia recorded another good quarter, securing two major rail contracts in Hong Kong and a telecommunications project in Malaysia. In Hong Kong, Leighton Asia will be upgrading and extending an existing light rail system for the KCRC at a cost of $227m and has also been awarded a new $68m contract to construct trackwork for the MTRC.

“In Indonesia, a recovery in international coal prices has driven demand for increased production to the benefit of both Thiess and Leighton Asia.

“A number of telecommunications projects are being pursued in the region by Vytel Asia, a joint venture between Leighton Asia and the Australian based Vytel.

“The Group’s Australian telecommunications business continues to develop with Visionstream, a subsidiary of Leighton Contractors, moving through the design phase of Nextgen Networks and the $613m construction is expected to start in June of this year. In Queensland the Reef Networks fibre-optic cable development, stretching from Brisbane to Cairns, is almost complete.

“Thiess has maintained its strong position in contract mining and was awarded a $100m contract for underground coal mining at the Southland Colliery in NSW. Thiess has also been awarded a $50m contract to undertake open cut mining at the St Ives gold mine at Kambalda in WA.

“In Melbourne, Thiess was awarded two new building contracts during the quarter. Both the $61m contract at Port Melbourne and the $40m Metropolis contract are for the design and construction of apartments and associated services.

“In April, Leighton Properties finalised the sale of its landmark property at 80 Pacific Highway, North Sydney for $90.75m to the Investa Property Group. It is now focused on developing a new $120m office building at 100 Pacific Highway with ISPT Pty Limited and its com.parks at Thomastown and Mulgrave in Victoria.

“In the engineering and infrastructure market the medium term outlook is becoming more positive. A number of large infrastructure projects planned by Government such as Sydney’s Cross City Tunnel, the Western Sydney Orbital and Melbourne’s Scoresby Freeway should provide the impetus for an improvement in this market.

“Australia’s largest infrastructure project, the Alice Springs - Darwin rail line is now underway, delivering some $220m worth of work to John Holland. A year after the acquisition, John Holland’s integration into the Leighton Group has progressed well and it is now trading profitably.

“The Group will continue to use its financial strength and core contracting skills to grow its diversified business. Telecommunications and mining have successfully insulated the Group from the construction downturn in Australia. The strategy of making selective acquisitions and taking strategic shareholdings will continue to be pursued to provide shareholders with enhanced returns.

“The outlook for 2001 remains very positive with work in hand and revenues forecast to be up significantly on the previous year. Profit for the full year is expected to be an improvement on the previous year and the outlook for the future remains strong, said Mr King.

ENDS.

Issued by:
Leighton Holdings Limited
ACN 004 482 982

For further information:
Mr Wal King AM
Chief Executive Officer
Ph:  (02) 9925 6912

Mr Dieter Adamsas
Director, Finance & Administration
Ph:  (02) 9925 6923