M&R falls to H1 loss, to sell assets

South African building firm Murray & Roberts fell to a half-year loss on Wednesday and said it will sell some assets in the Middle East and Australia, as it fights to ride out an industry-wide slump.

M&R, South Africa's second-biggest building firm by market value, reported a diluted headline loss per share of 124 cents in the six months to end-December, from a profit of 200 cents per share a year earlier.

Headline earnings, the main measure of profit in South Africa, exclude certain one-time items.

The company, which has been building Africa's first rapid rail link, said it was in talks to sell some of its underperfoming businesses in the Middle East and properties in Australia.

M&R said it expects an increase in full-year revenues in the Middle East and its cement business, but projected no growth for the South African construction business.

The South African construction industry, which avoided the worst of the global economic crisis due to big World Cup projects in 2010, is now having difficulty finding new projects, as both the government and the private sector hold back on spending.

Construction companies are also the target of a bid-rigging probe from South Africa's competition watchdog, putting their shares under further pressure.

M&R said its order book stood at 50 billion rand and this included 19 billion rand of of outstanding value on five contracts related to projects with Eskom , the state energy firm.

Earlier this month Aveng, Africa's biggest builder by market value, warned that first-half earnings are likely to fall by as much as 20 percent, citing tighter domestic margins and payment delays on some contracts.

Shares in the group were down 0.04 percent at 28 rand by 1356 GMT, outperfrming a 1.2 percent weaker Johannesburg All-share index.