Sharechat Logo

Australia's Cimic gives Auckland rail the glad eye

Thursday 7th February 2019

Text too small?

Australian construction firm Cimic Group has Auckland's rail network firmly in its sights, touting two projects in a list where it's been short-listed or is currently bidding. 

The company, formerly Leighton Holdings, has identified a pipeline of at least A$130 billion of tenders to be awarded or bid for in 2019 and a further A$300 billion beyond that, of which A$120 billion is via public-private partnerships. It's currently bidding or has been short-listed on 16 projects, including the Auckland light rail stage one main works for the New Zealand Transport Agency and Auckland's City Rail Link C3 stations and tunnels for Auckland Transport. 

Cimic's CPB Contractors is a member of a consortium with UGL, Beca, McMillen Jacobs, and Jacobs New Zealand short-listed for the C3 project.

Meanwhile, the Auckland light rail project started sounding out the market for a preferred procurement model in the final quarter of 2018, with a view to start construction next year. It has already attracted an unsolicited bid from the New Zealand Superannuation Fund and Canadian fund manager CDPQ Infra.

Cimic yesterday reported a net profit of A$780.6 million in calendar 2018, up from A$702.1 million a year earlier, on a 9.2 percent increase in revenue to A$14.67 billion. The company is ultimately controlled by Spain's Actividades de Construcción y Servicios. 

Several New Zealand projects were name-checked as contributing to those results, including the construction of Christchurch Hospital, the Transmission Gully public-private partnership, and another Kiwi PPP to build three primary schools. Upcoming work includes the A$687 million contract to design and build Waikeria prison. 

Cimic sees the New Zealand government's plans to spend NZ$42 billion during the next five years as offering a range of construction opportunities that suit the company. The pursuit of PPPs is also an area Cimic identified as an opportunity. 

The government's six-month financial statements released today show the Crown's capital commitments totalled $13.64 billion as at Dec. 31, of which $4.1 billion was for state highways, and another $4.44 billion was for land and buildings. The Crown spent $4.56 billion buying physical assets in the half, up from $3.66 billion a year earlier, and about $101 million below forecast. Treasury projects the net purchase of physical assets to total $10.67 billion in the June 2019 year. 

Cimic shares rose 3.3 percent to A$48.29 today. They are about 4 percent higher than a year ago, well above their A$39.575 12 month low.


  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares fall in muted trading; Gentrack drops on Brexit jitters
NZ dollar treads water ahead of FOMC statement
Gold Report 19th March 2019
Act to remove terrorist videos and content: NZ broadband providers
Hydrogen refuelling trial underway in 2019 - Hiringa Energy
Asian refining margins rebound - Refining NZ
Fulton Hogan profit drops on troubled Australian projects, slowing NZ work
Government suspends negotiations to conclude financing arrangement for Westland
Indonesian and Taiwanese arrivals help Auckland International Airport to a record
Warehouse 1H profit climbs 12% as financial services exit starts paying off

IRG See IRG research reports