Downer EDI Ltd Extension of maintenance contract

Extension of maintenance contract:Downer EDI Ltd (ASX: DOW) reported a 1.7% rise in total revenues including other income and joint venture to $3.6 billion for the first half of FY17. EBIT was higher by 6.7% to $120.8 million while profit from ordinary activities after tax was higher by 8.5% to $78.2 million. The company reported a 13.2% rise in diluted EPS to 17.1 cents and announced an interim dividend of 12 cents. Downer reported return on funds employed of 13% up from 12.5% and work in hand of $21.1 billion up from $18.6 billion at June 2016. Meanwhile, the group reported that Sydney Trains had exercised its options to extend Downer’s maintenance of the Millennium passenger trains for a further 10 years. The ten-year contract extension begins in June 2017 and is valued at approx. $225 million. Addition to Millennium maintenance, the company would maintain the Waratah trains for another 26 years and in near future will maintain, the new Sydney Growth trains for 25 years and Victoria’s High Capacity Metro Trains for 30 years. In addition, the Downer Bombardier join venture would continue to maintain the Western Australian Public Transport Authority’s A and B fleets until 2026.    

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