Fulton Hogan has record levels of New Zealand work in hand as it enters the next 12 months, its New Zealand chief executive Ben Hayward says.
The company has been awarded new road maintenance contracts in Tauranga, Gisborne and Nelson for the first time, while it has retained the Auckland Transport North Urban and Wellington Transport Alliance contracts, both of which are decade-long.
The maintenance business is on track for its best annual scores across all its network outcome contracts, Hayward says in the company’s 2022 annual review.
The outlook is also strong for the road construction team.
It has been awarded Penlink, the two-lane motorway and shared user path between State Highway 1 and Whangaparāoa in Auckland, and the Takitimu North Link between Waihī and Tauranga – a combined value of more than a billion dollars.
Three million cubic metres of earthworks have been completed on Te Ahu a Turanga Manawatū Tararua Highway, the 11.5-kilometre route to reconnect Manawatū, Tararua, Hawke’s Bay and northern Wairarapa, replacing the closed SH 3 Manawatū Gorge route.
Hayward says on the Papakura to Drury South motorway enhancements project, a well planned and executed bridge demolition saved 20 nights of concrete sawing, with the bridge demolished and removed from the motorway in a single night shift.
In the water space, Fulton Hogan’s Watercare New Connections contract has been extended for a further three years, while the front face at the Waimea Community Dam, the first concrete faced rock-fill dam to be built in New Zealand for 25 years, has been completed.
Investment for the environment
Hayward says reducing diesel consumption will be key as the company looks for ways to meet its carbon reduction targets.
It has committed to converting its light vehicle fleet to hybrid or electric, and is currently trialling New Zealand’s first 50-tonne hybrid excavator at Stevenson Aggregates.
In 2023, a new hydrogen powered tanker will begin transporting bitumen between Tauranga and Auckland.
In Nelson and Drury, Fulton Hogan has installed silt presses to replace sediment ponds, driving significant safety and environmental improvements.
“Having carried out an independent energy audit of our bitumen and asphalt plants, we have identified a number of areas to reduce energy,” he says.
“We continue to undertake periodic replacement of aged plants with modern energy efficient models, and FY23 will see another two plants replaced.”
Outlook
Hayward says the demand for infrastructure across all sectors in New Zealand will continue into the foreseeable future.
“We will continue to build on our integrated supply chain where it makes sense, such as with construction of a new bitumen tank at Lyttelton, new Stevenson concrete plants in Ranui and Silverdale in Auckland, and a new quarry at Roydon, Christchurch.”
He says Government-led reform and contracting model reviews in some of the company’s operating sectors will continue to provide challenges and opportunities over the coming year.
“In particular, Waka Kotahi NZ Transport Agency is reviewing how it structures the NOC maintenance contracts, and its strategy for importing bitumen.
“Three Waters is undergoing unprecedented reforms, however, the significant water infrastructure deficit continues to make this market attractive and a focus of growth.”
Financial performance
Across Fulton Hogan’s New Zealand and Australian businesses, the group’s profit increased 4.1 per cent to $301 million in the 12 months ended June 30, up from $289 million the year before. Revenue rose 10 per cent to $5.2 billion, up from $4.78 billion.
Board chair Dean Hamilton says all businesses contributed well, with its Australian Infrastructure Services and Land Development business in New Zealand both reporting increased profits compared to the 2021 financial year.
Covid-19 related shutdowns continued to disrupt, with particular impacts on the upper North Island business in New Zealand in the earlier months of the financial year, and in its Australian Utilities business, with the deferral of a number of projects by clients.
Fulton Hogan has a number of speakers appearing at next month's Future Roads conference.
View the full programme here