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Opus optimistic new strategy bearing fruit

NZN 11/04/2017 Rebecca Howard

Opus International Consultants is already seeing benefits from its new business strategy and that momentum has continued into 2017, shareholders were told on Tuesday.

At Tuesday's annual meeting in Wellington, chairman Kerry McDonald, who also announced his retirement in the next few months, said while the 2016 result was disappointing there were key elements that were "positive and encouraging," including in Australia and Canada which have been the two areas of "greatest difficulty".

The Wellington-based company reported a loss of $29.9 million, or 20 cents per share, in calendar 2016, compared to a profit of $16.7m, or 11 cents, a year earlier.

Opus's Australian and Canadian units were hit hard by the collapse in oil prices, helping spur a restructure of its business last year along sector lines of buildings, water and transportation instead of country-based divisions.

Mr McDonald said the changes were essential to ensure a viable future for the business and included a complete revamp of things like the company's project management system.

The new strategy isn't a simple tweak, but is a "completely different way of doing business," he said. Among other things, it takes into account fast moving technology and innovation and is beginning to bear fruit.

Opus Stewart Weir, its Canadian geomatics business, moved from a trading loss of about $5.1m in the first half to a profitable second half of $2m.

As the "strategy starts to bed in, and the benefits of the improvement initiatives take hold, early trends are positive and encouraging," said managing director David Prentice.

Gross Margin improved in the first quarter of 2017 and is ahead of the same comparable period over the last four years, he said.

Still, not everyone was satisfied. Former chief executive Kevin Thompson told the meeting: "I am no longer disappointed in Opus' performance, I am concerned."

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