Our opinion on the current state of M&R-HLD(MUR)
Murray and Roberts (MUR) is a large South African construction company which has suffered from the sub-prime crisis and then the slump in construction spending following the 2010 World Cup. This brought the share down from a massive double-top formation at around R100 per share to a low below R5 in May 2020.
The company has been consolidating and reducing costs. It has transformed itself into a "...multinational engineering and construction Group focused on the natural resources market sectors..." with three primary business platforms - underground mining, oil & gas, and power & water.
On 27th March 2023, the company announced that it had sold its Australian operations (65% of Insig Technologies) for A$1, disposing of A7m in liabilities. On 8th December 2023, the company reported that it would be able to reduce its debt from R2bn in April 2023 to R350m as a result of "Cementation Canada Inc's recently renewed banking facility agreement with a Canadian bank will provide for Cementation Canada to pay CAD40 million."
In its results for the year to 30th June 2024, the company reported revenue of R13,5bn, up from the previous year's R12,5bn, and an attributable loss of R138m. The company's net asset value fell to 350c per share, down from the previous year's 407c. The company said, "Reduced diluted continuing headline loss per share 24 cents (FY2023: 71 cents loss) - Net cash, including advance payments and working capital improvements R0,4 billion (FY2023: R0,3 billion net debt)."
In a trading statement for the six months to 31st December 2024, the company estimated that HEPS would fall by at least 20%. This announcement caused the share price to enter a new downward trend. MUR remains a relatively risky penny stock with high debt levels.
On 15th July 2024, the company announced that it had won a 200m multi-year contract in Latin America. However, on 22nd November 2024, the company's board of directors stated that the company met the Companies Act definition of being "financially distressed" and that the best way forward was to enter into business rescue. Accordingly, trading in the company's shares has been suspended on the JSE.
The company has been consolidating and reducing costs. It has transformed itself into a "...multinational engineering and construction Group focused on the natural resources market sectors..." with three primary business platforms - underground mining, oil & gas, and power & water.
On 27th March 2023, the company announced that it had sold its Australian operations (65% of Insig Technologies) for A$1, disposing of A7m in liabilities. On 8th December 2023, the company reported that it would be able to reduce its debt from R2bn in April 2023 to R350m as a result of "Cementation Canada Inc's recently renewed banking facility agreement with a Canadian bank will provide for Cementation Canada to pay CAD40 million."
In its results for the year to 30th June 2024, the company reported revenue of R13,5bn, up from the previous year's R12,5bn, and an attributable loss of R138m. The company's net asset value fell to 350c per share, down from the previous year's 407c. The company said, "Reduced diluted continuing headline loss per share 24 cents (FY2023: 71 cents loss) - Net cash, including advance payments and working capital improvements R0,4 billion (FY2023: R0,3 billion net debt)."
In a trading statement for the six months to 31st December 2024, the company estimated that HEPS would fall by at least 20%. This announcement caused the share price to enter a new downward trend. MUR remains a relatively risky penny stock with high debt levels.
On 15th July 2024, the company announced that it had won a 200m multi-year contract in Latin America. However, on 22nd November 2024, the company's board of directors stated that the company met the Companies Act definition of being "financially distressed" and that the best way forward was to enter into business rescue. Accordingly, trading in the company's shares has been suspended on the JSE.
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