Engineering and construction group Wilson Bayly Holmes-Ovcon (WBHO) has warned that it expects to impair its Mozambique-based steel business Capital Star Steel (CSS), following insufficient production and aggressive competition in the international project pipe market.
CSS is a subsidiary of Capital Africa Steel (CAS), the company through which WBHO operates its construction materials businesses. Despite CAS providing R120-million to support recovery plans, CSS profitability was “severely affected” by various production stoppages.
WBHO noted that the impairment would affect earnings a share, but would not impact on headline earnings a share.
By: Natalie Greve