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Government Signs Off on $424m Campbelltown Redevelopment

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A multi-million construction contract has officially been awarded for the second stage of the Campbelltown Hospital Redevelopment, guaranteeing the delivery of another major infrastructure project in Sydney's west.

The NSW Government funded project has been awarded to Australia's biggest contractor, ASX-listed CIMIC Group.

The project will be built by CIMIC's construction company CPB Contractors and will generate the company $424 million in revenue.

The project is the second stage in the redevelopment of the hospital, with the first stage completed in January 2016.

The first stage of the redevelopment, costing $134 million, included a multi-storey acute services building with new inpatient wards and the Macarthur Clinical School, was completed in 2016 and officially opened in 2017.

▲ Stage two of the Campbelltown Hospital redevelopment project at Campbelltown, in Sydney's west.
▲ Stage two of the Campbelltown Hospital redevelopment project at Campbelltown, in Sydney's west.


The second stage of the redevelopment will see further enhancements to the hospital campus and will include a new 12-storey clinical services building with modern wards and patient facilities, a bigger emergency department, and modern centrally-located mental health units.

It will also include new operating theatres and intensive care unit, women’s health services, increased access to cancer, outpatient and ambulatory care services and new nuclear medicine and dental services.

CIMIC chief executive Michael Wright said the group was continuing to demonstrate its outstanding capability to deliver health facilities across Australia.

“We’re committed to providing infrastructure to meet these vital community needs now and for future generations,” Wright said.

The new hospital will be well placed for the estimated population boom of western Sydney, expected to rise from two million to three million people over the next 20 years.

By 2031, greater western Sydney will be home to over half of Sydney's population.

Construction has now commenced and is expected to be complete by mid-2023.

▲ Shares in CIMIC tumbled more than 17 per cent to a two-year low after investors were disappointed by first half results.
▲ Shares in CIMIC tumbled more than 17 per cent to a two-year low after investors were disappointed by first half results.


CIMIC hits two-year low

Last month, CIMIC's stock price tumbled 19 per cent to its lowest level since March 2017.

Revenue from CIMIC’s construction business was down 7 per cent to $3.6 billion and profit slumped by 15 per cent to $268.8 million over the six months to June.

The company revealed that its construction profits and cash flows were weakening and that it had sold almost $2 billion of its receivables to third parties.

CIMIC said it had a robust balance sheet, with net cash of $1.4 billion and a diversified order book with $36.8 billion of work in hand, up eight per cent since June 2018.

Projects within the company's pipeline include the Cross River Rail tunnel in Brisbane, maintenance work on Sydney trains, building an aquatic and indoor recreation centre in Christchurch, work on the Auckland Airports taxiway, Coffs Harbour Hospital expansion work and a number of mining contracts.

The engineering giant is also working on road and rail developments such as WestConnex in Sydney, the West Gate Tunnel project in Victoria and the Logan Motorway project in southeast Queensland.

CIMIC reported a half-year profit of $367 million for the six months to June and reaffirmed guidance for a full-year profit of between $790 million to $840 million.

It said it had strong work in hand of $36.8 billion, equivalent to more than two years' worth of revenue, and was bidding for another $60 billion on offer this year, and $400 billion next year, including $130 billion in public private partnerships.

Over the first six months of this year the group was awarded $8.3 billion in new work.

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Article originally posted at: https://theurbandeveloper.com/articles/government-signs-off-on-424m-campbelltown-redevelopment