Shares in Leighton Holdings have jumped more than seven per cent as the construction giant forecasts a "positive" long-term outlook and a return to profit in fiscal 2012.
As foreshadowed, Australia's biggest construction company reported a loss of $408.8 million for the 12 months to June 30, a sharp change from the $612.0 million profit a year earlier.
But it reiterated a net profit forecast for financial 2012 of $600 million to $650 million.
At 1120 AEST, shares in Leighton Holdings were $1.43 higher, or up 7.2 per cent, at $21.28.
Leighton Holdings chief executive David Stewart said the loss was an "extremely disappointing result" brought about by challenges such as the Queensland airport link and the Victorian desalination projects.
"Pleasingly though, the Leighton Group maintains a strong level of work in hand, has a strong balance sheet and anticipates reporting an after tax profit of between $600 to $650 million for the 12 months to June 30, 2012," Mr Stewart said in the statement on Monday.
The guidance does not include the potential impacts of the sale of part of the HWE Mining iron ore business to BHP Billiton.
Mr Stewart said Leighton's long-term outlook remained "positive," based on $46.2 billion worth of work in hand, a strong competitive position and strong economic activity in major markets.
"The group's diversity strategy is providing us with a range of Australian-based construction and mining opportunities and supplemented by our presence in the growth markets of Asia, positions the company well for future growth," Mr Stewart said.
Construction across the major markets in developing Asia was forecast to grow strongly over the next five years, supporting a positive outlook for the group.
Revenue for financial 2011 increased four per cent to $19.4 billion.
The Australian non-residential construction market was forecast to rise by five per cent per year, in real terms, over the next four years, offering a good range of construction opportunities, with the key drivers being resources investment, backed by transport infrastructure and utilities construction and a gradual recovery in commercial building.
Aside from the airport link and desalination projects, Leighton Group's underlying results across the core contracting business were "solid" during the year, with good performances from markets such as Asia, telecommunications and oil-and gas-related construction.
The company said sustained demand from Asia for commodities such as iron ore and coal was continuing to underpin new infrastructure and mining opportunities in Australia and across the Asian region.
Leighton said its operating companies had been awarded some significant projects in the last quarter which supported its contract mining in Australia and Botswana, rail construction in Singapore and Hong Kong, construction work for the national broadband network (NBN) and two major hospital projects.
It also said it had moved to strengthen its balance sheet in April 2011, raising $758 million in equity via an accelerated renounceable entitlement offer.
Leighton shareholders have equity of $2.3 billion, total assets of $9.8 billion and debt and finance facilities of around $1.8 billion.
