One day after restructuring its planned purchase of Ocean to Outback Consulting, Emerson Stewart Group has reported a return to profit but acknowledged its overall performance for financial year 2011 was disappointing.
The engineering and surveying group increased its annual revenue to $33 million , up from $12 million the previous year, but the company said the result masked the contrasting performance of the group’s two divisions, Whelans and Emerson Stuart Consulting.
The group’s consolidated after tax profit was just $86,000, up from a $1.7 million loss in the previous year.
The Whelans surveying and town planning division generated revenue of $22 million, for a $1.7 million pre-tax profit, while Emerson Stewart Consulting lodged $10.7 million in revenue, for a $1.4 million pre-tax loss.
“The strong performance of the Whelans division was commendable,” the company said.
“The performance of the Emerson Stewart Consulting division is the subject of a board initiated performance and restructuring review, the report and intended action arising from which is scheduled for delivery to the board at its September 2011 meeting.
At close of trade today the group’s stock had slipped 7 per cent, to 5.4 cents.
On Tuesday, shareholders approved changes to the planned purchase of OTOC, which equates to a backdoor listing by the contracting group.
Shareholders agreed that, if Emerson Stewart is unable to raise the full $11.9 million in a share placement, the vendors will accept extra scrip rather than cash.
OTOC shareholders will emerge with a majority stake in Emerson Stewart after the transaction.
