CONTRIBUTION LIABILITY
Settlement fund adds to Group Five loss
Group Five’s core operating profit plunged from a R315m profit to a loss of R338m in the six months ended December 2016, as its engineering and construction operations saw a core operating loss of R518m. The loss was helped by recognition of the group’s contribution of R255m to a collective R1.5bn voluntary settlement agreement reached with the government and seven listed construction and engineering groups to help transform the sector over 12 years. A liability of R152.7m, reflecting the net present value of this sum, was recorded in the latest period. "You take the whole hit now," departing Group Five CEO Eric Vemer said on Wednesday. The group said earlier in the day that Vemer would be resigning and a replacement would be identified in due course. "Markets remain challenging, especially in core construction where the volumes, but not profits, are," Vemer said. Other one-off liabilities in the period included a R244m impairment on Transnet’s multi-fuel pipeline from Durban to Joh...
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