Building boom triples Esor earnings

building boom triples esor earnings

pretoria - acquisitions and organic growth as construction demand boomed helped esor, the altx-listed geotechnical engineering specialist, to report triple-digit growth in earnings and revenue in the six months to august.

"the market is the most robust that i have seen in 30 years," esor chief executive bernie krone said yesterday. "all indicators are that this is not a flash phenomenon, but a sustainable period of growth that should maintain for at least five to eight years."

esor's headline earnings a share rose to 25.6c from 8.4c a year earlier.

krone said: "we are confident that real growth in earnings and headline earnings a share will be achieved at year-end." esor's order book was approaching r1 billion.

the key growth drivers in the market were the government's r400 billion infrastructure expansion programme, expansion plans by airports company south africa (acsa), the gautrain rapid rail project and the 2010 soccer world cup, which had led to unprecedented demand for construction.

esor has active contracts with acsa and for the gautrain.

"while government infrastructure spend may be considered the major driving force, other factors are at play, for instance commercial developments," said krone.

esor's revenue rocketed to r473.6 million from r76.9 million. net asset value a share grew 141 percent to r1.288. no interim dividend was declared, but management is committed to a dividend for the year to february.

krone said the company's focus on operating efficiencies and cost control had translated to bottom-line growth.

the acquisition of franki africa had enabled the group to take on more and larger contracts.

esor shares rose 12.97 percent to r8.80 yesterday.