Two major gas projects off the coast of Western Australia have contributed to strong earnings growth for takeover target Skilled Group.
The labour hire and workforce services provider has agreed to a $652 million takeover by rival Programmed Maintenance Services, and the change of control is expected to be completed in October.
Skilled Group included a $60 million writedown on goodwill in its results for the 2014/15 financial year as part of the takeover deal, which resulted in an annual net loss of $16.7 million.
But chief executive Angus McKay said revenue and earnings were well above 2013/14 levels, due to acquisitions and work flowing from the Gorgon and Ichthys gas projects.
Skilled also cut costs by $15 million.
"This is a strong operating result for the group, reflecting an improved second half performance," Mr McKay said.
Shares in Skilled gained six cents, or 3.8 per cent, to $1.64.
Skilled's engineering and marine services division accounted for 45 per cent of revenue during the year, and achieved 52 per cent growth in revenue.
The division expanded due to acquisitions in the past 18 months, and activity remains robust due to work on Gorgon and the Saipem gas pipeline, part of the Ichthys project, Skilled said.
Revenue and earnings dropped in the company's workforce services division, which provides blue collar labour hire, and in its technical professionals division, which supplies engineering, white collar and nursing staff.
Skilled also announced its shareholders will receive a special dividend of 15.5 cents if they approve Programmed's takeover at a meeting scheduled for September.
WRITEDOWN WEIGHS ON SKILLED GROUP
* Annual net loss of $16.7m, down from net profit of $44.2m in 2013/14
* Revenue of $2.05b, up 9.5 pct from $1.87b
* Final dividend of 9.5 cents per share, unchanged
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