September 4, 2018 / 7:08 AM / 3 months ago

UPDATE 1-Australia helps Wilson Bayly Holmes overcome S.Africa weakness

(Adds detail and background)

JOHANNESBURG, Sept 4 (Reuters) - South Africa’s Wilson Bayly Holmes (WBHO) reported a 14 percent jump in full-year profit on Tuesday, as a favourable market in Australia and growth in its roads and works division offset a fall in revenues at home.

The construction and engineering company, which reported profits of 1,414.6 cents per share, said revenue growth was driven by Australia and the rest of Africa.

Revenue in Australia rose 18 percent, lifted by strong growth in the building and infrastructure businesses.

While growth in Africa increased 32 percent, South Africa’s contribution fell 6 percent, with new road work contracts providing some relief.

“The decrease in local revenue was primarily attributable to lower activity within building markets and the knock-on effect on the construction materials business,” the company said.

South African construction companies have been hit hard in recent years as stagnant growth has affected government public infrastructure spending, prompting the company to seek opportunities elsewhere.

WBHO entered the UK market in 2017 after acquiring a 40 percent stake in Byrne Group.

In July, the firm - through its UK subsidiary WBHO UK - also spent 600 million rand ($40 million) to acquire a 60 percent stake in UK construction firm Russell Limited and a further 62 million rand for a 31 percent stake in property developer Russell Homes.

“The construction market in the United Kingdom was identified as offering the most potential at acceptable levels of risk,” the company said.

WBHO declared a final dividend of 325 cents per share, in line with the same period in 2017. (Reporting by Patricia Aruo; Editing by Louise Heavens and Mark Potter)

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