Construction company Consolidated Infrastructure Group (CIG) expects to report a headline loss a share of between 91c and 137c for the six months ended June 30.
This will be an improvement of between 67% and 78% compared with the headline loss a share of 417c reported for the six months ended February 28, 2019.
Its loss a share for the six months to June 30 is expected to also be between 91c and 137c a share, being an improvement of between 70% and 80% compared with the loss a share of 456c reported for the prior comparable period.
CIG on August 14 said the first six months of the 2019 financial year’s results were impacted by impairments to unrecoverable work in progress and receivables, mainly in the Consolidated Power Projects (Conco) business, as well as impairments to goodwill, intangibles and the reversal of previously recognised deferred tax assets.
Meanwhile, the Covid-19 pandemic and resultant extended lockdown in South Africa has significantly impacted on the company and brought most of the group’s operations and construction sites to a standstill for two months, followed by a slow restart thereafter.
The group has also changed its year-end from August to December and, as a result, the previous corresponding period referred to was for the six months ended February 28, 2019.
In terms of the group’s debt restructuring plans, it has appointed Metis Strategic Advisors to assist with the objective to conclude a debt restructure in a timeous manner.
The restructured debt profile is critical to the sustainability and trading ability of the company, the group says, noting that negotiations are in progress.
The impact of Covid-19 has necessitated another reassessment of the group’s cash forecasts and, as a result, the company has engaged with the original lenders requesting a concession to the recently signed agreements, “as the conditions could no longer be fulfilled”.
Earlier this year, in March, the group had finalised and signed a binding term-loan facility agreement with four original lenders. These agreements allowed for the restructure of its debt profile, and would result in a substantial portion of the short-term debt owed by the company, being converted to term debt.
Conco also engaged with its local bank lenders with requests for concessions to the terms of agreement reached.