Lend Lease profits jump +50%
By Helen Wright26 August 2011
Australian construction company Lend Lease reported a +50% rise in operating profits to AU$ 485 million (US$ 509 million) for the financial year to 30 June, 2011, despite a -15% year-on-year fall in revenues to AU$ 8.9 billion (US$ 9.3 billion).
The jump in operating profits was down to the sale of the group's 50% stake in the King of Prussia shopping mall in May - the largest enclosed retail shopping mall on the East Coast of the US. Lend Lease said the divestment contributed AU$ 102 million (US$ 107 million) to operating profit for the year.
In addition, each of the contractor's regional business divisions - Australia, Asia, Europe and Americas - reported increased operating profits.
The largest division, Australia, reported an AU$ 34 million (US$ 36 million) increase in operating profits to AU$ 281 million (US$ 295 million). The division completed its acquisition of Valemus Australia from Bilfinger Berger in March, adding an infrastructure unit to the Australian portfolio.
Lend Lease said the integration of Valemus was progressing well, and reported an infrastructure backlog of AU$ 6 billion (US$ 6.3 billion) at 31 July, 2011, with a further AU$ 800 million (US$ 840 million) of work pending.
Group CEO and managing director Steve McCann said the company had made "significant progress" in the 2011 financial year and saw "attractive opportunities in the Australian market and "strong market fundamentals" in Asia in 2012.
However, Mr McCann warned that the economic outlook in the US and Europe remained uncertain.
"In Lend Lease's business in the Americas we continue to see some signs of a market recovery, however conditions remain patchy. In the UK, Lend Lease is well placed with our major urban regeneration projects that will be developed as the market recovers," he said.