“The group’s strategic positioning and business model delivered a broader infrastructure offering which contributed to the solid performance. We are therefore pleased to report improved results, with increased revenue, operating profit and earnings over the comparable reporting period,” said [DATA GRF:Group Five] in a statement.
The integrated construction firm reported a 43.8 per cent increase in headline earnings per share (HEPS) to 407 cents with diluted HEPS at 399 cents, an increase of 42 per cent.
Earnings per share (EPS) and fully diluted EPS rose by 51.9 per cent and 50.4 per cent to 401 cents and 394 cents respectively.
(READ MORE: Group Five expecting increased interim HEPS)
Group revenue increased by 38.9 per cent from 11 billion rand in 2013 to 15.3 billion rand this year while core operating profit grew by 18.4 per cent to 654 million rand despite a weak performance from its civil engineering segment.
A gross dividend of 55 cents per ordinary share was declared, bringing the total dividend for the year to 100 cents.
“The underlying performance of all the group’s businesses was pleasing in the context of weak South African market conditions, and in line with expectations with the exception of a slower than expected second half recovery in Civil Engineering,” continued the statement.
(READ MORE: Group Five expects to recover from 2013 losses)
The firm also announced that after eight years of service, Upton will be approaching the executive retirement age of 60 at the end of the year and his successor will be appointed within the next few months.
Most of the group’s underlying business performed in line with management expectations except for the civil engineering segment which was affected by a decrease in profit recognition.
Also, the firm’s performance during 2013 was impacted by losses in its Middle Eastern civil engineering operations and a Competition Commission penalty fee charged to its construction’s division.
The group said that engagements with the Commission are still underway.
“Settlement has not yet been concluded due to a lack of evidence and factual discrepancies which remain and which the group views as very serious given the reputational impact and potential for civil claims.”
(WATCH VIDEO: Competition Commission fines construction firms R1.46BN)
On the other hand, Group Five remains confident that its strong position in the markets will continue to generate positive results despite slow growth in the South African market.