Cimic (ASX:CIM) share price edges lower following 25% drop in statutory NPAT

Cimic shares are in the red today…

Female worker in hard hat puts thumb down while on the phone

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Cimic shares down 1.93% to $16.78
  • Mostly positive set of numbers, however investors appear to be focusing on statutory NPAT which fell 35% year-on-year
  • Cimic is forecasting FY22 NPAT between $425 million and $460 million

The CIMIC Group Ltd (ASX: CIM) share price is in negative territory during late morning trade. This comes after the engineering company dropped its full-year results for the 2021 financial year.

At the time of writing, Cimic shares are travelling 1.93% lower to $16.78 apiece.

Let's take a look at how the company performed for the period.

Cimic share price backtracks following mixed results

The Cimic share price is travelling lower following the release of the company's results. Here are some of the key operational highlights:

  • Group total revenue of $14.7 billion, up 8.3% on the prior corresponding period (FY20 $13.57 billion)
  • Earnings before interest, tax, depreciation and amortisation (EBITDA) of $913.9 million, up 11.5% (FY20: $820 million)
  • Operating profit of $630.2 million, up 8.7% (FY20: $579.5 million)
  • Statutory net profit after tax (NPAT) of $402.1 million, down 35.2% (FY20: $620.1 million)
  • Final unfranked dividend of 36 cents per share declared, down 40% from 60 cents in FY20

What happened in FY21 for Cimic?

The company reported $20.4 billion of major contracts that were won during the period, however this wasn't enough to keep its share price afloat.

Cimic revealed that its statutory NPAT fell by 35.2% on the back of discontinuing its use of factoring arrangements. The completion of the strategic initiative led to a reduced balance from roughly $2 billion at December 2019 to $434 million at December 2021.

In addition, the company progressed the withdrawal from the Middle East, with the transfer to the acquirer of the Qatar business completed.

Management is hoping to resolve legacy items, including completing the exit from the Middle East and progressing CCPP and NRAH arbitration hearings.

What did management say?

Cimic group executive chair and CEO, Juan Santamaria touched on the result, saying:

Cimic achieved solid 2021 financial results, with NPAT within our guidance range, total dividends of 78c per share, increased work in hand, and significantly improved EBITDA cash conversion.

We diversified our funding sources, completed our strategic unwind of factoring, and repaid and discontinued the supply chain finance program.

Other significant achievements included the IPO of Ventia, commercial settlement on the West Gate Tunnel project, and financial close for North East Link.

FY22 outlook for Cimic

Looking ahead, Cimic is forecasting FY22 NPAT to be in the range of $425 million to $460 million. This represents a potential increase of 4.8% to 13.5% on FY21 underlying NPAT of $405.4 million.

The FY22 guidance is being supported by the group's numerous projects along with a positive outlook across core markets.

Cimic has an extensive pipeline with over $480 billion of tenders to be bid and/or awarded in 2022 and beyond.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Earnings Results

Two happy excited friends in euphoria mood after winning in a bet with a smartphone in hand.
Earnings Results

ASX 200 stock jumps 10% on strong FY24 results

How did this KFC restaurant operator perform in FY 2024?

Read more »

A male investor wearing a white shirt and blue suit jacket sits at his desk looking at his laptop with his hands to his chin, waiting in anticipation.
Consumer Staples & Discretionary Shares

Guess which ASX 200 stock just slashed its final dividend by 23%

This retailer had a tough time during the 12 months. Here's how it performed.

Read more »

Man jumps for joy in front of a background of a rising stocks graphic.
Earnings Results

Catapult shines: 20% sales growth propels ASX tech stock to new 52-week high

A strong annual result from this tech player has caught investor attention.

Read more »

A man in his 30s holds his laptop and operates it with his other hand as he has a look of pleasant surprise on his face as though he is learning something new or finding hidden value in something on the screen.
Earnings Results

Xero share price leaps 8% on staggering earnings upheaval

A major turnaround in profitability is sending investors into a frenzy over Xero shares today.

Read more »

a construction worker sits pensively at his desk with his arm propping up his chin as he looks at his laptop computer while wearing a hard hat and visibility vest in a bunker style construction shed.
Materials Shares

Which ASX 200 stock just plunged 12% despite record full-year earnings?

It looks like an impressive report card but UBS doesn't like the FY25 guidance.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Earnings Results

ASX 200 tech stock lifts off on another record-setting half-year profit

Investors are bidding up the ASX 200 tech company following its half-year results.

Read more »

increasing rural asx share price represented by happy looking sheep
Earnings Results

Why is this ASX All Ords stock staying strong as profits crash 76%

How is this company's share price marching higher after mowing down more than three-quarters of its profits compared to a…

Read more »

Two men sit side by side on a couch with video game controls in their hands and expressive looks on their faces as they react to the action in front of them in a home setting.
Earnings Results

Guess which ASX 200 stock is surging 11% on an 'outstanding' result

This ASX gaming giant just posted a 17% jump in profits, and its shareholders are basking in the glory.

Read more »