The Cimic Group Ltd (ASX: CIM) share price has remained relatively flat despite two positive updates, one announced on Friday and the other today.
At the time of writing, the Cimic share price is 0.78% up at $19.45. This compares to the S&P/ASX 200 Index (ASX: XJO) which is 0.1% higher at 5,968 points.
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What does Cimic do?
The Cimic Group provides a range of services to the infrastructure, resources and property markets. These include construction, mining, mineral processing, engineering, concessions, and operation and maintenance services.
The company operates in more than 20 countries throughout Asia Pacific, the Middle East, North and South America, and Sub-Saharan Africa.
Ventia contract extension
Cimic Group's 50% owned associate, Ventia, has been awarded a contract extension. The 18-month extension will provide asset maintenance services to the New South Wales Land and Housing Corporation (LAHC).
Ventia will earn $124 million in base contract revenue, with a further $160 million should it provide additional programs. It will deliver maintenance, project and program services in Sydney, Newcastle and the Hunter Valley.
Ventia Group defence and social infrastructure executive Derek Osborn said:
The award of this extension is testament to the exceptional service delivered by our team throughout our 18-year relationship with NSW Land and Housing Corporation, and from the outset of this contract.
I'm pleased that this extension provides the opportunity to continually innovate and improve our service for the benefit of LAHC, its tenants and the wider communities.
The original contract was awarded to Ventia in April 2016, with the new extension taking the term up to December 2022.
Thiess contract extension
The group's global mining services provider, Thiess, was awarded a contract extension by Glencore on Friday. The 18-month extension will provide mining services at Mount Owen in the Hunter Valley, Australia.
It is projected the commitment will generate A$340 million revenue for Thiess, which will strengthen its balance sheet.
The deal sees Thiess provide mine planning, design and execution, drill and blast, overburden removal and coal mining services.
Thiess managing director Douglas Thompson was pleased with the company's effort, saying:
For more than 25 years we have delivered industry-leading, specialised mining techniques at Mt Owen, leading to higher resource recovery, increased plant efficiency and reliable material movement for our client.
Our team looks forward to continuing our long association with Glencore and the Hunter Valley community.
Cimic advised that the contract extension would start in July 2021.
Cimic share price summary
The Cimic share price fell to a multi-year low $11.87 in the March bear market. Since then Cimic has pushed higher following the overall rebound of ASX shares. However, as investor confidence wears thin, the Cimic share price is 40% down from the beginning of the calendar year.
