Leighton Asia News, July 2005 - Leighton Holdings

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However, this move coincided with a massive downturn in the property market in Hong Kong, which had a catastrophic effect on the construction industry. In their scramble for work, construction companies began to slash their margins. Many did not survive. The future was further clouded because Britain and China had not yet resolved the future of Hong Kong past 1997. The uncertainty delayed investment decisions and extended the recession. Construction activities remained depressed until 1985, when Leighton Asia stormed ahead by winning ten new contracts including the HK$1.2 billion Tuen Mun light rail transit system in consortium with Victoria’s Metropolitan Transit Authority. This massive turnkey contract was a fitting marker to end Leighton Asia’s first decade. Building and civil engineering remained the cornerstone of the company’s activities, with some very significant projects being awarded by the Hong Kong Government including the HK$344 million Chuk Yuen housing project and a massive site formation contract at Lam Tim worth HK$168 million – then the largest civil engineering project ever awarded by the Hong Kong Housing Authority. Despite this, the cloud of uncertainty still hung over the still-British colony. No political decisions had been yet made on Hong Kong’s future past 1997. As a result, by 1989, Leighton was having difficulty retaining quality local staff, because many of the company’s experienced employees were leaving to live overseas. Concerned over the situation, Leighton decided to diversify further geographically; opening an office in Bangkok. Throughout Hong Kong, business confidence was starting to sag, until the government took steps to ‘stop the rot’. In a bold move, it announced the massive Port and Airports Development Scheme (PADS). However, it would be two years before the first of the contracts under the program would be awarded. In 1992, Leighton became the first company to win a PADS project; the advanced earthworks for the Route 3/Lantau Fixed Crossing Interchange on Tsing Yi Island – a contract worth about HK$1 billion. The upsurge in activity led Leighton to upgrade its fleet and the company introduced the first Caterpillar D11 dozers into Hong Kong. The problems of recent years were soon forgotten as major contracts started to flow; starting with the massive HK$2.47 billion joint venture West Kowloon reclamation project. Meanwhile, the office in Thailand was showing very positive results. The first project there was to build the THB280 million Burli Jucker House. This was followed by significant contracts for residential and commercial developments, and then a tracking station for the British Broadcasting Corporation. The search for new contracts was strongly supported by Leighton’s intensive safety programs and its increased emphasis on obtaining quality accreditation in the countries where it was now operating. In 1995 Leighton won its largest-ever project undertaken on its own; the HK$1.2 billion contract for the engineering, procurement and construction of the aviation fuel service facility at Hong Kong’s new airport site. With its enhanced reputation and boosted by a strong flow of work-in-hand, Leighton again expanded its sights, opening offices in Hanoi, Manila and Ho Chi Minh City over the next two years. Vietnam proved to be an important, albeit relatively small market for the company. Key projects included the new Australian Embassy in Hanoi and the Saigon Metropolitan Tower in Ho Chi Minh City – one of the city’s landmark buildings. A relationship formed with China State Muang Thong Banga, Housing development, Thailand. Tai Po Aqueducts, Hong Kong.
Construction Company was aimed at increasing opportunities for Leighton in mainland China. By 1996, building was by far Leighton’s strongest-performing business sector and contributing largely to the record level of new work being secured. Countering this was a significant downturn in civil engineering and infrastructure work as Hong Kong’s PADS projects started to wind up. At a commercial level, 1997, the Hong Kong ‘handover’ year, came and went without great drama. The change in sovereignty had no negative effect on the business environment. Indeed, Leighton enjoyed another year of record turnover and profits in Asia. Although the new Hong Kong airport was now close to completion, the government would soon announce massive new infrastructure and public housing programs. Leighton was very well placed to benefit from them; by now having undertaken many high-rise housing projects for the Hong Kong Housing Authority – and having developed an innovative jump-form construction technique, which allowed faster completion. Leighton had now also gained a reputation as a ‘quality’ builder throughout the wider region in which it operated; winning prestige commercial projects such as the A$100 million Rockwell Centre project in Manila. In Malaysia, Leighton won the nationwide Teachers’ Housing project – 10,000 apartments – for which it would eventually achieve 17-million manhours without a lost-time injury and, for this, be awarded the World Safety Organisation’s ‘Concerned Company Award’. Between 1997 and 2002, the company had doubled in size and achieved a far broader footprint across the region. In order to facilitate the continued expansion of its operations in the region, the company decided to separate Leighton Asia into two separate entities – Leighton Asia (Northern) and Leighton Asia (Southern). The key objective was to provide greater management strength and focus to enable the business to continue growing. > Leighton Asia (Northern) encompasses operations in Hong Kong, China, Macau, Taiwan, Philippines, Thailand, Vietnam and Laos, and > Leighton Asia (Southern) covers Malaysia, Indonesia, Singapore, Brunei, Sri Lanka, India, Pakistan and the Arabian Gulf. Today, as it enters its fourth decade, Leighton Asia is one of the region’s leading contractors and project developers. The total value of its work in hand is now over US$1 billion and the company is consistently winning major projects in its key market segments. Current major projects include the HK$3.8 billion Central Reclamation project and the HK$1.8 billion Eagle’s Nest Tunnel project in Hong Kong, the RM908 million Kuala Lumpur to Putrajaya Highway in Malaysia, the MSJ coal mine in Indonesia, and the RM381 million Rawang-Ipoh rail project in Malaysia. Leighton Asia (Northern) and Leighton Asia (Southern) now employ more than 4000 people throughout Asia. The current Central Reclamation project in Hong Kong. Saigon Metropolitan, Vietnam. Teachers' Housing, Malaysia. Operating from these centres, it undertakes a diverse range of projects involving civil engineering and infrastructure, mining, building, railways, marine works, oil and gas, telecommunications and other specialised disciplines. It has certainly come a very long way since 1975, when it sent a small team from Australia to Hong Kong to establish a toehold in Asia. While building remained a core business sector, in 1999 a spate of new railway contracts started to redress the balance for civil engineering. They included: > A HK$1.2 billion joint venture with China State Construction Engineering Corporation to construct stations, tunnels and associated works for the Tseung Kwan O extension of Hong Kong’s Mass Transit Railway. > A HK$800 million trackwork contract for West Rail permanent way. Over the next two years, Leighton would also win more than HK$2.2 billion of rail work, including tracklaying and the extension of Hong Kong’s light rail network. Additionally, through the acquisition of John Holland’s Indonesian operations, it would inherit a significant rail project in Thailand. page 19
Page 1 and 2: Leighton Asia News July 2005
Page 3 and 4: Changing of the guard • Will Hami
Page 5 and 6: Named the Zhong Ren 703, it needed
Page 7 and 8: Sewer project meets the challenges
Page 9 and 10: Above: The Leighton team. Right: Th
Page 11: Recollections of key staff Ray Brew
Page 17: Leighton Asia was established in Ho
Page 21 and 22: Leighton on track for increased pro
Page 23 and 24: More telco work in Malaysia DiGi Te
Page 25 and 26: The award-winners line up. Leighton
Page 27: An artist’s impression of the new

Leighton Asia News, July 2005 - Leighton Holdings

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