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Murray & Roberts stops trading, puts SA operations on life support
25 Nov 2024
Murray & Roberts (M&R) announced on Friday that it will be voluntarily suspending share trading. A quick look at the company’s financial statements reveals a turbulent year of liquidity constraints and operational setbacks. Despite stabilising revenue across its global underground mining businesses, the South African division suffered the descoping of the Venetia contract, which slashed over 50% of its local mining business. Further losses in the OptiPower division intensified the group’s challenges.
M&R finished off its last fiscal with a 34c loss per share, compared to earnings of 789c in the previous year.
Much of that loss was still part of the Covid-19 drag on its Australian operations and the ongoing challenges in the local market.
The mining businesses was strong, though, generating most of its revenue and earnings, recorded good results for the fiscal year.
However, these were offset by losses in the renewable energy and power infrastructure business OptiPower.
These challenges highlighted the company’s dependency on repatriating funds from subsidiaries and successful sales of non-core assets to pay off its R409m bank debt that is due in January 2026.
Business rescue
To stabilise its position M&R initiated voluntary business rescue proceedings in its South African operations, calling the process “essential to ensuring sustainable recovery”.
Under the leadership of Metis Strategic Advisors as business rescue practitioners, the focus will be on restoring liquidity through asset disposal and restructuring.
The parent company and its profitable underground mining operations – including Cementation APAC and Cementation Canada – remain unaffected and continue to operate as going concerns.
Suspended trading
The company says the decision to suspend trading on the JSE is to protect shareholder interests while the group navigates these challenges.
CEO Henry Laas assured stakeholders that the group remains solvent, with high-quality assets supporting the rescue effort.
“This temporary suspension allows us to implement our business rescue strategy without the volatility associated with trading during such uncertain times,” Laas said.
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