Opus takes a conservative approach to new acquisitions

The Kicking Horse Canyon roading project in Canada, one of Opus' international roading projects/ Photo supplied.

Having completed 10 acquisitions in three countries since 2003, Opus International Consultants is taking a more conservative approach to future purchases as the global economic crisis grinds on.

Managing director Kevin Thompson told the company's annual meeting in Wellington today that Opus had reduced non-labour indirect costs significantly and cut its ongoing capital spending budget for 2009 by 50 per cent.

"We will be approaching any future acquisitions conservatively and do not plan for the use of significant cash or bank debt for such programmes until the economic outlook becomes clearer," Thompson said.

In this country the infrastructure consultant was well positioned as its operation was heavily involved in public infrastructure.

Such work was expected to be maintained at current levels, with additional opportunities from the Government's planned infrastructure economic stimulus package.

Thompson also reported that in Canada there were no signs of the economic situation adversely affecting the business.

In Britain plans had already been announced to cut the workforce of 360 by 75 staff, aimed at cutting costs by $6 million on an annual basis, and Opus continued to manage the position.

In Australia, as well as its work in public infrastructure, the company had significant involvement with developer-led projects which had suffered a significant downturn.

"This has presented us with an additional exposure that we are currently managing," said Thompson.

The Australian workforce of 360 had been reduced by 15 staff in response to reduced opportunities in a number of the company's offices.

Chairman Kerry McDonald said the immediate future would undoubtedly be challenging, "but with our strong organisation and excellent capabilities and market positions we are very well placed to compete and succeed".

Opus was formed when the Ministry of Works and Development was privatised in 1988 and was floated in 2007.

In 2008, the company's revenue rose 25 per cent from a year earlier to $371.5m, with the net surplus after tax up 23 per cent to $17.5m.

Opus shares closed at $1.24 yesterday, having ranged between $1.95 and $1.04 in the past year.

- NZPA