Business Description:
Monadelphous Group Limited (MND) is an engineering group providing project management, construction, asset management and maintenance services to the resources, energy and infrastructure industry sectors. The company operates three business divisions: Engineering Construction, Maintenance and Industrial Services and Infrastructure.

Strategy Analysis:
MND´s strategic objective is to establish a resilient business through economic cycles with the ability to deliver quality earnings growth by the provision of contracting services to the resources, energy and infrastructure sectors. Diversification into the infrastructure sector is a well-considered strategy, which could eventually help to insulate it from an inevitable downturn in resource and energy project work. During the past ten years, MND has established a solid industry reputation, a strong balance sheet and a sound growth strategy. Engineering and construction contracting work prospects remain positive with a healthy forward work load combined with strengthening resources and energy project pipelines, should ensure high levels of tendering activity in the short term. But long term future growth is highly dependent on increasing levels of resource and energy sector activity and the flow of projects. Customers ultimately maintain strong bargaining power over MND due to an ability to substitute contractors. Monadelphous Group reported NPAT up 14.2% to $95.07m for the year ended 30 June 2011. Revenues from ordinary activities were $1.45bn, up 13.2% from last year. Growth was achieved across all three operating divisions and in all markets - resources, energy and infrastructure. Diluted EPS was 106.87 cents compared to 95.46 cents last year. Net operating cash flow was $125.2m compared to $95.97m last year. The final dividend declared was 55 cents, taking the full year dividend to 95 cents compared with 83 cents last year. The Company is confident of securing a number of significant opportunities in the first half of the new FY. Timing of projects remains a risk in the short term. The long-term outlook for major engineering construction services remains positive.