Contractor Leighton Holdings has been hit by a surge in debtor levels, with clients slow to pay their bills as the mining boom fades, sending Leighton's shares down.
It suffered a $600 million blow out, which it is struggling to return to more normal levels. The total level of trade and other receivables on its balance sheet stood at $4.4 billion when it ruled off its books on June 30, up from $3.8 billion.
It described as "unacceptable" the blow-out in the level of trade receivables, with around half of the total owed by oil and gas companies.
Leighton shares dropped as much as 7 per cent after the result, and last traded at $16.26.
"They booked the revenue but they are not getting the cash flow. Clients have not paid them yet," said Shane Delphine, an investment manager at Karara Capital.
The increase in receivables is due partly to larger contract sizes coupled with project delays. The decline in the value of the Australian dollar also pushed the total figure up, it said.
The second largest is coal mining, which is partly due to the downturn in coal prices which has hurt the ability of clients to pay their debts.
There has also been a further extension in the anticipated repayment of probllem accounts in the Middle East and north Africa, with 59 per cent of the amount due here not expected to be repaid for longer than 2 years, up from 51 per cent six months ago.
"Detailed plans are in place to drive the recovery of receivables," the chief executive, Mr Hamish Tyrwhitt said.
Leighton also today lifted its interim dividend following a profit rebound, which was underpinned by gains from the sale of a telecommunications subsidiary.
In the June half, it posted a net profit of $360.2 million, up from $105.9 billion on revenue of $11.5 billion up from $11.1 billion.
As a result, it has lifted the interim dividend to 45 cents from 20 cents paid previously.
Earnings benefited from a $215 million gain from the sale of its 70 per cent stake in a telecommunications subsidiary.
Underlying earnings were $255 million, up from $115 million which was in lilne with analyst forecasts.
Earnings a share rebounded to $1.08 from 34 cents, it said.
Leighton reiterated its full-year guidance of $520 million to $600 million net profit as it seeks to rebuild cashflow and margins.
Its key Middle East joint venture with Habtoor broke even in the half, it said.
Anticipated progress in the repayment of a shareholder loan did not occur, due to a Qatari client calling in performance bonds on legacy contracts, it said.
It remains on track to sell down its Habtoor venture equity via a public float in 2016, it said.