NEWS ANALYSIS: Aveng worst affected as construction industry bleeds
Aveng leads major players in South Africa undergoing an existential crisis, writes Mark Allix
Some of the major players in SA’s construction industry are undergoing an existential crisis. Probably none more so than Aveng, whose R53bn annual turnover in financial 2014 has now shrunk to about R23.5bn. Eric Diack, executive chairman and acting CEO of the group, is candid about the problems. These include underbidding on projects amid fierce competition for tenders, bad management, poor project execution and a weak economic environment in SA. Despite a rebound in mineral commodities and a better outlook for global growth, the group continues to produce poor results across many of its businesses. To this end, it has just concluded a strategic review that proposes selling off noncore assets and restructuring around its Moolmans mining business and the McConnell Dowell civil engineering operations that operate in Australasia. While Aveng resolved 20 of 24 disputed contracts in the six months to December 2017 and reduced net debt to R555m from R937m in December 2016, gross debt of R...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.