Sydney, July 20, 2006 AEST (ABN Newswire) - Hastie Group Limited, Australasia's leading commercial and industrial air conditioning and refrigeration systems group, today announced it has formed a joint venture to undertake air conditioning installation projects in Dubai. Work on the joint venture's first design-and-construct project, with an estimated value of A$20 million, is expected to begin in the second quarter of FY2007.
Hastie has also identified feasible opportunities for work in Abu Dhabi and other Gulf states.
The company's joint venture partner in Dubai is Al-Futtaim Engineering Co., a wholly-owned subsidiary of the Al-Futtaim Group (www.futtaim.com) which is a leading regional group with 70 years' history and a major position in the retail, automotive, electronics, insurance, engineering and real estate sectors. Hastie will have 60 per cent participation in, and management responsibility for, the Al-Futtaim Hastie joint venture.
Al-Futtaim Hastie's projects will be at Dubai Festival City (www.dubaifestivalcity.com), a 650 hectare, multi-billion dollar mixed-use development owned and developed by the Al-Futtaim Group. The joint venture will target contracts to install air conditioning systems, together with related mechanical, electrical and plumbing services, in new buildings including luxury hotels, high rise commercial and residential complexes, and retail malls.
Hastie's managing director, Jerry Maycock, said: "Al-Futtaim Hastie combines the local knowledge, product portfolio and project access of Al-Futtaim Engineering with Hastie's experience of major air conditioning projects. Its formation follows nearly twelve months' market investigation and preparatory work since we established an initial presence in the United Arab Emirates (UAE).
"Hastie now has over 20 engineering and design staff working in, or committed to, our UAE office, and this number will increase significantly during the coming months, supported by existing engineering resources in Australia. Some of these staff are working exclusively on Al-Futtaim Hastie projects, and the others will focus on further opportunities in Dubai and other Gulf states."
Mr Maycock said that the decision to proceed with the Arabian Gulf business will not affect Hastie's existing FY2006 profit forecast, which is for earnings before interest and tax (EBIT) above $28.75m.
In FY2007 the Gulf business is expected to be cash flow positive and make a small contribution to profit, but not to alter Hastie's FY2007 profit outlook range of $32 - $35 million EBIT.
Assuming progress as planned, the Gulf business is expected to make a material contribution to group profit in FY2008. Hastie's annual results for FY2006 will be released on September 5 th .
Hastie Group Limited has grown over 35 years from a Sydney air conditioning business into the leading commercial and industrial air conditioning and refrigeration systems group in Australia and New Zealand, with subsidiaries also active in the UK and in the United Arab Emirates. Hastie Group subsidiaries operate under brands which are well recognised in their respective commercial and industrial markets. It has 1,900 employees based at over 40 locations. Customers include many of the largest construction companies, shopping centre groups, supermarket chains, industrial corporations and facility managers. Hastie Group is a member of the S&P/ASX-300 Index.
Contact
Jerry Maycock
TEL: +61 2 9714 2180
Media enquiries
Anthony Tregoning
Financial & Corporate Relations (FCR)
TEL: +61 2 8264 1000 / 0411 852 448
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