Picture: SUPPLIED
Picture: SUPPLIED

Murray & Roberts has won new underground mining projects in North American and Australasian markets worth a total of R3.8bn, to be delivered over a period of up to four years.

This pushes up the value of the group’s underground mining platform order book about 25% from the R15.3bn reported as at the end of December 2017.

The group has undergone years of restructuring to take advantage of global energy, mining, oil and gas and water projects amid dire South African mining and general infrastructure markets.

“Based on the improvement in the commodity cycle and increased investment by mining companies, we expect the global mining market to present long-term growth potential for our underground mining platform,” said CEO Henry Laas.

Revenue from continuing operations in the interim period to December 2017 rose 10% to R11.8bn, while diluted headline earnings per share from continuing operations more than doubled to 55c. This was helped by a strong performance in the underground mining business and reduced losses in the Middle East. The group’s overall order book for continuing operations fell 10% to R22.1bn in the period, with little work in oil and gas, and in power and water sectors.

Ed Jardim, group investor and media executive, said on Friday that Murray & Roberts was bound by confidentiality regarding the individual values of the new projects, based in the US, Canada and Australasia.

“We are bound [also] by confidentiality … from providing details of the client name and exact mine locations, but I can confirm it’s a blend of gold, copper, lead, zinc and nickel. We are bullish about the opportunity that the underground mining platform is presented with, not only in sub-Saharan Africa, but Australasia and the Americas.”

Electus Fund Managers analyst Mishal Emeran said the cementation business within the group’s underground mining platform was a “good business” and that order book growth was not unexpected. The platform covers six continents and spans project value chains, including for shaft and decline sinking, mine development — including rehabilitation — raise boring and contract mining, as well as specialist engineering and mining services.

But Emeran said the “more challenging” part of the group’s global strategy was prospects for the oil and gas division.

This targeted the US and Australia. Meanwhile, there was not much else in the project pipeline, he said.

allixm@bdfm.co.za