Preliminary Final Report - Financial Review

InternationalAsia’s growth is also providing construction opportunitiesfor the Group. No other contractor has the Group’s footprintacross Asia and, when combined with a reputation fordelivery, this positions Leighton uniquely for growth. HongKong, Macau, India and other selected Asian markets arecontinuing to look for the experience and capability of aninternational contractor like the Leighton Group. OperatingCompanies will target opportunities in these markets wheretheir services are valued and they can extract value forshareholders.In the Middle East, petro-dollar driven economies willcontinue to invest strongly in infrastructure, theconstruction of which is a core competency of the Group.Leighton is bringing this competency to the HabtoorLeighton Group – traditionally a builder – and diversifyingthe business into new markets such as Oman, SaudiArabia and Kuwait. While some parts of the Middle Eastare still suffering the fallout of the global financial crisis, theregion continues to provide a good range of opportunitiesin the mid-to-long term that suit the evolving HabtoorLeighton Group.Group ProspectsThe Group is confident it is positioned in the best possiblemarkets in the world for at least the foreseeable future. TheAustralian and Asian regions, the Middle East andSouthern Africa are continuing to grow based on theindustrialisation and urbanisation of Asia and the region’sdemand for minerals and energy. These markets haveEnglish as a business language and the Group has a longestablished presence which is well known to many clients.As a contractor, Leighton has leverage to these markets,both directly by working in them, and indirectly as asupplier of services to clients that are supplying to Asia.Backing these market opportunities is a strong balancesheet and a near record level of work in hand with ahealthy level of inherent profitability.GuidanceThe Company had previously issued guidance for the 12month period ending 30 June 2012 for underlying profitafter tax of between $600-650 million, excluding gains fromsales and impairments. The Company remains committedto this guidance. For the full financial year to 31 December2012, the Group expects to deliver profit in a similar rangeto that forecast for the 12 month period ending 30 June2012.InvestmentsEngineering & Infrastructure• AquaSure: Thiess has a 5.2% share of the consortiumthat will finance, design, build, operate and maintainthe Victorian Desalination Project.• BrisConnections: Thiess and John Holland will invest$200 million in the consortium that will own, operateand maintain the Airport Link Project in Brisbane.• Aspire Schools: Leighton Contractors has a 50%share of the consortium that will finance, design,construct and maintain over 30 years, 7 schools inSouth East Queensland.• Cross City Motorway: Leighton Contractors has 6%of the company that owns, operates and maintains theCross City Tunnel in Sydney.• SA Health Partnership: Leighton Contractors has a19.9% share in the consortium that will finance, design,construct and maintain the new Royal AdelaideHospital for 35 years.Mining and Resources• Cockatoo Island Project: HWE Mining is a 50:50 jointventure owner of an iron ore mine in WesternAustralia.Listed Entities• Sedgman Limited: Thiess owns 32.43% of the listedresources engineering company.• Macmahon Holdings Limited: Leighton Holdingsowns 19.45% of the listed engineering and miningcontracting company.Leighton Holdings Limited DECEMBER 2011 UPDATE Page 44