AusGroup, the energy and resources specialist, says group net profit attributable to equity holders for 2Q FY2010 decreased 33% to A$3.4 million ($4.2 million).

Revenue for 2Q FY2010 decreased 34% to A$85.8 million mainly due to lower activity levels in the group’s Australian manufacturing, fabrication and construction segments which experienced the delayed impact from the global financial crisis.

The acquisition of Modern Access Services (MAS) was completed in Q4 FY2009 and MAS recorded revenue of A$14 million for 2Q FY2010 compared with that of A$9.9 million for 1Q FY2010.

The group’s gross profit declined by 9% in 2Q FY2010 to A$14 million, however gross profit margin improved from 11.8% to 16.3%. Margin increase was mainly due to finalisation of certain variation claims related to work undertaken within the Major Projects Construction division.

The other operating income increased by 62% to A$2.4 million in 2Q FY2010 mainly due to increase in interest income and supplier rebates.

Expenses for 2Q FY2010 increased by 7.2% to A$10 million due mainly to the additional expenses associated with recently acquired MAS. Excluding MAS related expenses, the expenses were stable compared to the corresponding quarter.

The net cash generated from operating activities for 2Q FY2010 was A$13.7 million. The group’s cash and cash equivalents stood at A$20.0 million as at Dec 31 2009 with a low net gearing of 5.1%.

With bright LNG outlook in Western Australia, the group is confident that demand for its Australian based services will improve over the next 12 months. For the Singapore side, the group expects the next half of FY2010 to be similar to the first half and does not expect over 12 months a significant improvement in the activity levels.

The group also notices a gradual but slower than anticipated recovery in the Australian mineral resources sector. This slower pace of recovery is due to the residual effects of the GFC and the group foresees margin pressures in the next 2 quarters. However, over a 12 month horizon, the group expects an improving outlook in activity levels in this sector.

Overall, the group has an order book of A$467 million as at end of January 2010 and is well positioned to continue to secure opportunities in the sectors it operates in for the next reporting period and the 12-month outlook.