Government’s funding constraints take its toll on Esor
The construction company says the slight improvement to its order book is not reflective of the buoyant tender market
Vandalism, community unrest and "government administrative procedures" were just some of the woes civil engineering group Esor listed in its interim results released on Thursday morning.Esor’s revenue for the six months to end-August declined 17% to R553m and its after-tax profit of R2m was nearly a quarter of the matching period’s R7.5m.The group said its order book at the end of the reporting period stood at R1.41bn, marginally higher than the previous year’s R1.4bn."The slightly improved order book is not reflective of the buoyant tender market. The non-awarding of tenders to contractors is currently frustrating and problematic, largely due to funding constraints in government infrastructure budget allocations," the results statement said.Esor cut its workforce by 438 people during the six-month reporting period, costing it R5.8m in retrenchment costs. It had 2,056 remaining employees at August 31.Although its tenders for Department of Water and Sanitation projects were the cheap...
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