Seven Group Holdings has posted a positive result on its first half of FY21, thanks in part to Caterpiller dealer WesTrac’s upcoming customer commissions and its increased investment in Boral.
The giant of industrial services, oil and gas, and media boasted improvements in revenue and underlying earnings, as well as in overall workplace safety and culture.
Seven Group Holdings’ (SGH) managing director and chief executive officer Ryan Stokes was positive about the results.
“Today’s result reflects the strong performance of our key operating businesses,” he said. “We are pleased to deliver Group revenue growth and underlying EBIT growth for WesTrac and Coates.”
The SGH press release reported a positive outlook ahead as customer demand for parts, components and various mining growth services is growing. SGH took this growth in its stride and invested a further $390 million in Boral to claim a 20% stake in the business.
By the end of FY20, the height of the COVID-19 pandemic, Boral reported a statutory net loss of $1.139 billion, having made a net profit 58% less than the prior corresponding period.
With a 20% stake, SGH plans to support Boral in resetting and aims to improve returns and deliver better operating leverage.
Some of the major changes occurring at Boral in FY21 include the sale of USG Boral and Meridian Brick, which Boral has owned for the past 8 and 5 years, respectively.
Stokes said the investment in Boral is well timed for SGH, as the wider economic recovery helps SGH in getting the most out of the opportunity.
“Our Industrial Services portfolio is benefitting from accelerating mining production and economic stimulus measures to generate building and infrastructure activity,” Stoke said. “During the half, we further increased our exposure to Industrials and the growing pipeline of infrastructure projects through our investment in Boral.”
SGH made sure to include its results on its safety culture in all industries, as the group reported just 0.7 lost time injuries per million hours worked.
On top of this Stokes said the company was proud of its contribution to environmental and social sustainability, with WesTrac and Coates Hire on track to achieve carbon neutrality by 2040.
“This continues the proud history of SGH in corporate social responsibility as seen through our actions in the community, dedication to staff well-being and safety, and innovations within our businesses to re-use equipment and minimise waste.”
Earlier this year, SGH was able to boast its strong financial position when WesTrac had enough enough cash to support the Yunaga Civil & Earthmoving Company (YCE), an Indigenous organisation based in the Hunter Valley region of NSW.
WesTrac contributed heavy machinery from Caterpillar, including excavators and dump trucks.