AUSTRALIAN INFRASTRUCTURE METRIC June Quarter 217 The IPA/BIS Oxford Economics Australian Infrastructure Metric (the Metric) is the leading indicator of real investment in Australia s civil infrastructure. The June quarter of the Australian Infrastructure Metric produced by Infrastructure Partnerships Australia and BIS Oxford Economics - shows civil construction work won increase compared to the previous quarter, but remain below the long-run average. While mining infrastructure investment continues to be subdued, there was significant work won for non-mining infrastructure (economic infrastructure) with large contracts for transport projects signed during the quarter. The June 217 quarter saw the Australian Infrastructure Metric headline result rise sharply off the back of major railway projects. Total civil construction activity continues the fluctuating trend since December 215, largely reflecting non-mining work won activity. June quarter highlights: The total construction work won index has risen to 81.9, only 5.3 per cent below the long-run average an increase on the weak result in the March 217 quarter Figure 1 June Quarter Work Won Trends March 217 Quarter Index Value June 217 Quarter Index Value Per cent change (four quarter rolling average) June quarter vs long-run average TOTAL CIVIL 23. 81.9 2.3% 5.3% Non-Mining 29.9 114.3 3.1% 26.3% Transport 17.6 165.3 1.% 62.9% Utilities 48.4 33.6 14.9% 46.% Mining 6.9 6.3 22.9% 91.9% Non-mining work done is estimated to have risen by $222 million over FY216/17, and is forecast to rise by $7.3 billion over FY217/18 and $2 billion over FY218/19 Non-mining infrastructure investment rose significantly to an index reading of 114.3, reflecting contracts signed for large-scale railway projects 1 Australian Infrastructure Metric June Quarter 217
AGGREGATE TRENDS Figure 2 Total Civil Work Won Index March 217 Quarter Index Value June 217 Quarter Index Value Per cent change (quarter on quarter) Per cent change (four quarter rolling average) June quarter vs long-run average TOTAL CIVIL 23. 81.9 255.5% 2.3% 5.3% The total work won index rose sharply to 81.9 compared to 23 in the March quarter; Work won in the quarter was 5.3 per cent below the longrun trend (see Figure 2); Work done is projected to increase by $646 million over FY217/18 and fall by $1.6 billion over FY218/19; and Transport infrastructure has the highest share of work won at 86 per cent, while mining infrastructure has the lowest share at two per cent. The June quarter shows a recovery in civil work won with a headline index reading (March 21 = 1) of 81.9 which is just 5.3 per cent below the long-run trend (see Figure 3). This is primarily the result of very high levels of transport infrastructure investment offsetting weaker results in utilities. While still low compared to historical trends, mining infrastructure also recorded positive levels of work won during the quarter to bring its average four quarter work won index (21 = 1) for FY216/17 up to 7.3 from 4.8 in FY215/16. FY215/16 and FY216/17 continue the trend of falling mining infrastructure work won and modest growth in nonmining infrastructure investment. There were several major roads & bridges and railway projects won during FY215/16, such as Capital Metro and works for the Northern Connector, a 15.5 kilometre motorway linking the Northern Expressway and South Road Superway in SA. However, the lumpy nature of investment in non-mining infrastructure has increased the volatility in the total civil work won index as they replace mining infrastructure as the key driver of civil construction (see Figure 3). FY216/17 also saw significant railway infrastructure investment including level crossing removals and works for the Sydney Metro project. Total civil construction continues to show an overall declining trend since 21, with the growth in non-mining infrastructure work won not fully offsetting the fall in mining infrastructure investment. The four quarter index (21 = 1) for total civil work won in FY216/17 fell to 43.7 from 56.4 in FY215/16 (see Figure 4). The total work won reading indicates that the June 217 quarter civil commencements will be between $12.5 billion and $18.5 billion (see Figure 3). The recent fall in work done is set to moderate as it approaches the current level of commencements with BIS Oxford Economics forecasting work done to increase by $646 million for FY217/18, before falling by $1.6 billion in FY218/19. 2 Australian Infrastructure Metric June Quarter 217
Figure 3 All Civil Work Won, Commencements and Work Done $ BILLION 65 INDEX 3 55 25 45 2 35 15 25 1 15 5 5 Jun 4 Dec 4 Jun 5 Dec 5 Jun 6 Dec 6 Jun 7 Dec 7 Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18 Jun 19 Dec 19 Jun 2 IPA/BIS Oxford Economics Work Won Metric All Civil (RHS) Total Work Done by Quarter (ABS Data) (LHS) Total Commencements by Quarter (ABS Data) (LHS) IPA/BIS Oxford Economics Work Done Forecast - All Civil (LHS) Figure 4 Four Quarter Average Work Won Index, FY21/11 to FY216/17 INDEX 18 16 Total Civil Mining Non-Mining 14 12 1 8 Total Civil Average (68.1) Mining Average (69.8) Non-Mining Average (67.5) 6 4 2 94.7 121.8 85.4 1.9 162.7 79.9 55.3 61.7 53.1 73.2 125.4 55.5 52.4 4.5 68.8 56.4 4.8 73.9 43.7 7.3 56. FY21/11 FY211/12 FY212/13 FY213/14 FY214/15 FY215/16 FY 216/17 3 Australian Infrastructure Metric June Quarter 217
NON-MINING (ECONOMIC INFRASTRUCTURE) 1 Figure 5 Non-Mining Work Won Index March 217 Quarter Index Value June 217 Quarter Index Value Per cent change (quarter on quarter) Per cent change (four quarter rolling average) June quarter vs long-run average Non-Mining 29.9 114.3 281.8% 3.1% 26.3% Transport 17.6 165.3 838.2% 1.% 62.9% Utilities 48.4 33.6 3.5% 14.9% 46.% The June 217 quarter saw the non-mining work won index rise to 114.3, following the low of 29.9 in the March quarter (Figure 5); Non-mining work in the June quarter is 26.3 per cent above the long-run trend; and Non-mining work done is forecast to increase by $7.3 billion in FY217/18 and $2 billion in FY218/19. The non-mining work won index (March 21 = 1) rose to 114.3 for the June quarter, up significantly from 29.9 in the previous quarter. This is 26.3 per cent above the long-run average and reflects the spike in transport infrastructure investment this quarter which has offset the fall in utilities work won. Figure 4 shows that while the four quarter non-mining work won index (21 = 1) has experienced a modest upward trend since FY212/13, this has been overshadowed by the collapse in mining infrastructure investment in FY214/15. As a result, total civil work won has fallen, and now closely tracks non-mining investment activity as it becomes the main driver of construction activity over the past three financial years (see Figure 4). While the non-mining work won index of 114.3 (March 21 = 1) for the quarter is a strong result, the very low levels of investment in the September 216 and March 217 quarters have brought the four quarter average index for FY216/17 down to 56 from 73.9 in FY215/16 (see Figure 4). Total non-mining work won indicates that commencements are expected to reach between $1 billion and $14.5 billion for June 217 (see Figure 6). Figure 6 shows that non-mining work done is forecast to increase in the near term, growing by $7.3 billion in FY217/18 and $2 billion in FY218/19. 1. Non-mining and heavy industry construction includes the development of transport (roads, bridges, railways and ports), utilities (electricity, water and sewerage, gas and telecommunications) and other work (including recreation and site clearing). While not including the direct construction of mines and heavy industry facilities, this category of work still includes the development of mining-related infrastructure, such as railways, ports and gas pipelines. 4 Australian Infrastructure Metric June Quarter 217
Figure 6 Non-Mining Work Won, Commencements and Work Done $ BILLION 2 18 16 14 12 1 8 INDEX 2 18 16 14 12 1 8 6 4 2 Jun 4 Dec 4 Jun 5 Dec 5 Jun 6 Dec 6 Jun 7 Dec 7 Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18 Jun 19 Dec 19 Jun 2 IPA/BIS Oxford Economics Work Won Metric Non-Mining (RHS) IPA/BIS Oxford Economics Work Done Forecast - Non-Mining (LHS) Non-Mining Work Done by Quarter (ABS Data) (LHS) Non-Mining Commencements by Quarter (ABS Data) (LHS) 5 Australian Infrastructure Metric June Quarter 217
TRANSPORT The transport work won index for the June quarter rose to its fourth highest reading since March 21 to 165.3, up from 17.6 in the previous quarter; Transport work won is 62.9 per cent above the longrun average; All subcategories of transport infrastructure saw increased work won on the previous quarter, with railway investment reaching its highest level since the Metric began; and Transport work done is projected to increase by $4.3 billion in FY217/18 and $2.2 billion in FY218/19. The transport work won index (March 21 = 1) rose to 165.3 for the June quarter, the fourth highest recording since the Metric began, driven by high levels of railway infrastructure investment. This result is a significant improvement on the reading in the previous quarter of 17.6 and continues the fluctuating trend in transport work won since December 215. As shown in Figure 8, investment in harbours has generally declined since FY21/11 from a four quarter index (21 = 1) of 132.2 to 2.4 in FY216/17. It has become a negligible component of the transport work won index while railway infrastructure investment has seen steady growth, with the four quarter index reading peaking at 181.4 for FY216/17. Roads & bridges investment continues to account for a major share of transport infrastructure work won, despite its four quarter index falling to 29.9 this financial year, down from 79.4 in FY215/16. More recently, the June 217 quarter saw the highest level of railway infrastructure work won, with contracts signed for major works associated with Sydney Metro and level crossing removals projects. For the roads & bridges and harbours infrastructure, major contracts signed during FY216/17 included works for the new Richmond River Bridge and upgrades to Swanson Dock. Despite volatility in work won, the several quarters of very high transport investment are expected to result in an increase in work done levels in transport infrastructure over the forecast period as shown in Figure 7. The recent movements in the work won index for transport suggest that commencements will be in the $5 billion to $8.5 billion range for the June 217 quarter (see Figure 7). Figure 7 also shows that transport work done is projected to increase in the near term, growing by $4.3 billion over FY217/18 and $2.2 billion over FY218/19. 6 Australian Infrastructure Metric June Quarter 217
Figure 7 Transport Work Won, Commencements and Work Done $ BILLION 12 11 1 9 8 7 6 5 4 INDEX 25 2 15 1 5 3 2 Jun 4 Dec 4 Jun 5 Dec 5 Jun 6 Dec 6 Jun 7 Dec 7 Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18 Jun 19 Dec 19 Jun 2 IPA/BIS Oxford Economics Work Won Metric Transport (RHS) IPA/BIS Oxford Economics Work Done Forecast - Transport (LHS) Transport Work Done by Quarter (ABS Data) (LHS) Transport Commencements by Quarter (ABS Data) (LHS) Figure 8 Transport Sub-Groups, FY21/11 to FY216/17 (Four Quarter Average Index) 2 Roads Rail Harbours 18 16 14 12 1 8 6 4 2 79.6 11.7 132.2 39.7 93.1 163.2 25.9 95.3 55.2 48.6 65.8 78.4 67.2 129.2 19.3 79.4 7.3 28.9 29.9 181.4 2.4 FY21/11 FY211/12 FY212/13 FY213/14 FY214/15 FY215/16 FY216/17 7 Australian Infrastructure Metric June Quarter 217
UTILITIES 2 The work won index fell in the June 217 quarter to a reading of 33.6 down from 48.4 in the previous quarter; This is significantly below the long-run average of 62.2; High levels of work won in gas pipelines and sewerage infrastructure have been offset by the fall in telecommunications investment; and Work done is forecast to increase by $3.6 billion in FY217/18. The June quarter depicts an overall weak performance in utilities. While the four quarter rolling average increased by 14.9 per cent, this is an indication of the poor performance of utilities infrastructure over the past five quarters, rather than a strong performance this quarter. The work won index is still well below the long-run average of 62.2. As the largest subcategory, telecommunications is the key driver of the work won index. Utilities work won since FY215/16 has largely reflected the highly volatile patterns of NBN-related investment with the spike in the December 216 quarter a result of the deployment of Fibreto-the-Curb technology. This quarter, telecommunications recorded no investment for the second quarter in a row. As shown in Figure 1, this has resulted in the four quarter telecommunications index for FY216/17 falling to its lowest level since the Metric began, although it is still the strongest utilities subcategory. FY216/17 investment has decreased by 65.7 per cent on last financial year. Although investment in gas pipelines was strong this quarter with a nine-fold increase compared to the March 21 quarter, FY216/17 saw an overall drop of 81.5 per cent on last financial year s investment. Figure 1 shows the four quarter average index decline to 13.6 from 73.4. Sewerage similarly had a strong index this quarter at 13.6 even though overall performance this financial year has also been poor falling to a four quarter index reading of 43.3 from 162.2 in FY215/16. In contrast, both the water and electricity sub-sectors have rallied this financial year. Electricity has jumped to 39.3 from 9.9 in FY215/16 and 13.3 in FY214/15. Likewise, the water sub-sector has had its second best performance since the Metric began, recording a four quarter index of 73.4 this financial year. The level of utilities work won indicates that commencements for this sector for the June 217 quarter will be between $5 billion and $6 billion. Figure 11 shows that work done in utilities infrastructure is expected to increase by $3.6 billion over FY217/18 and before falling slightly over FY218/19 by $252 million. 2. Utilities includes electricity, water, sewerage, telecommunications and gas pipelines, servicing both the mining and non-mining sectors of the economy. 8 Australian Infrastructure Metric June Quarter 217
Figure 9 Utilities Work Won, Commencements and Work Done $ BILLION 12 11 1 9 8 7 6 5 4 3 2 INDEX 18 16 14 12 1 8 6 4 2 Jun 4 Dec 4 Jun 5 Dec 5 Jun 6 Dec 6 Jun 7 Dec 7 Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18 Jun 19 Dec 19 Jun 2 IPA/BIS Oxford Economics Work Won Metric Utilities (RHS) IPA/BIS Oxford Economics Work Done Forecast - Utilities (LHS) Utilities Work Done by Quarter (ABS Data) (LHS) Utilities Commencements by Quarter (ABS Data) (LHS) Figure 1 Utilities Sub-Groups Work Won, FY21/11 to FY216/17 (Four Quarter Average Index) INDEX 6 Electricity Water Sewerage Telecomms Gas Pipelines 5 4 3 2 1 76.3 41.8 14.5 176.2 1.4 28.6 13.1 11.5 356.3 18.5 53.7 3.7 343.9 552.8 7.5 53. 15.4 229.4 25.5 13.3 32.7 34.3 FY21/11 FY211/12 FY212/13 FY213/14 FY214/15 FY215/16 FY216/17 46.2 31.7 9.9 9. 162.2 382.8 73.4 39.3 73.4 44.3 131.2 13.6 9 Australian Infrastructure Metric June Quarter 217
MINING 3 Figure 11 Mining Work Won Index March 217 Quarter Index Value June 217 Quarter Index Value Per cent change (quarter on quarter) Per cent change four quarter rolling average) June quarter vs long-run average Mining 6.9 6.3 9.6% 22.9% 91.9% The mining work won index remains low at 6.3, falling slightly from 6.9 in the previous quarter; Work won in the quarter is 91.9 per cent below the long-run average; and Work done is projected to fall $6.6 billion over FY217/18 and $3.6 billion in FY218/19 The mining work won index (March 21 = 1) recorded a reading of 6.3 for the June quarter, down slightly from 6.9 in the previous quarter. This is 91.9 per cent below the long-term average reading, but FY216/17 represents the first financial year since FY213/14 where the sector had positive levels of investment in all four quarters. This has lifted mining infrastructure s four quarter average work won index (21 = 1) to 7.3 from 4.8 in FY215/16 (see Figure 4). This is largely a result of the work won to support LNG projects. Overall, the sector continues to be subdued as a result of the collapse of the mining boom, which will see work done in the sector fall in the near term as shown in Figure 12. The work won reading for mining indicates commencements will be in the $2.5 billion to $4 billion range for the June 217 quarter (see Figure 12). Figure 12 also indicates that mining work done is expected to continue declining, with a fall of $6.6 billion over FY217/18 and $3.6 billion over FY218/19. 3. This includes the construction of mines, refineries, smelters, chemical processing plants, materials handling and storage facilities, oil refineries and platforms, blast furnaces, steel mills and other heavy industrial facilities. 1 Australian Infrastructure Metric June Quarter 217
Figure 12 Mining Work Won, Commencements and Work Done $ BILLION 5 45 4 35 3 25 2 15 1 5 INDEX 3 25 2 15 1 5 Jun 4 Dec 4 Jun 5 Dec 5 Jun 6 Dec 6 Jun 7 Dec 7 Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18 Jun 19 Dec 19 Jun 2 IPA/BIS Oxford Economics Work Won Metric Mining (RHS) IPA/BIS Oxford Economics Work Done Forecast - Mining & Heavy Industry (LHS) Mining & Heavy Industry Work Done by Quarter (ABS Data) (LHS) Mining & Heavy Industry Commencements by Quarter (ABS Data) (LHS) 11 Australian Infrastructure Metric June Quarter 217
WORK DONE FORECASTS Measuring the work won by civil contractors provides an important indicator of future trends in civil work done (activity) as measured by the Australian Bureau of Statistics (ABS). 4 BIS Oxford Economics forecasts: Total civil work done is expected to increase by $646 million over FY217/18. This is the first increase since FY212/13, turning around a four year contraction totalling over $4 billion Non-mining work done is expected to have increased by $222 million over FY216/17 and to increase by $7.3 billion in FY217/18 The headline forecast for FY217/18 predicts an increase in construction activity by $646 million compared to that of FY216/17. This brings the forecast back into positive territory following a steep decline in FY216/17 compared to FY215/16 (see Figure 13). The FY217/18 result signifies the continued move away from mining investments, with non-mining infrastructure, particularly transport, seeing large contracts signed in the last few years. However, these gains in non-mining have been too modest to completely offset mining infrastructure s decline. In FY216/17, a $222 million increase is predicted in non-mining work done compared with a decrease in mining work done of $15.9 billion. The same can be said for FY218/19, where an increase in non-mining work done by $2 billion is overshadowed by a contraction of $3.6 billion in mining work done. The majority of the non-mining work done stems from strong performance in the transport sector (see Figure 13). Transport is expected to expand by $2 billion in FY216/17, $4.2 billion in FY217/18 and a further $2.2 billion in FY218/19. In contrast utilities will see a decline of $1.85 billion in FY216/17 before a significant increase of $3.59 billion in FY217/18. Utilities will then contract again in FY218/19 by $252 million. The positive headline forecast for FY217/18 is reflected in Figure 14, which shows that the downward trend in work done, evident since the end of the mining boom in FY212/13, has started to moderate. Commencements have also seen a slow increase, resulting in the gap between commencements and work done narrowing as the effect of the mining boom dissipates. Similarly, Figure 15 shows that mining infrastructure s share of total civil work done is expected to decline from about 5 per cent during FY213/14 to 25 per cent in FY219/2. In contrast, the share of utilities and transport work done is expected to continue growing to a combined 7 per cent by FY219/2. Transport work won is projected to increase by $4.3 billion in FY217/18, and $2 billion in FY218/19 Mining infrastructure is expected to see the biggest retreat of any sector, with work done estimated to have fallen $15.9 billion in FY216/17. 4. Note Due to a range of factors, such as the time between a contract being signed and work commencing, direct comparisons of work won, as measured by the Metric, and work done, as measured by the Australian Bureau of Statistics (ABS), should be avoided. Rather, trends in work won, as well as trends in work commenced (as measured by the ABS) provide a guide as to future work done levels. 12 Australian Infrastructure Metric June Quarter 217
Figure 13 Forecast ABS Work Done, Change from FY216/17 to FY218/19 ($ Million) Total Civil 215/16 to 216/17 216/17 to 217/18 217/18 to 218/19 (Source: BIS Oxford Economics/ABS data) Mining Non-Mining Utilities Transport -2, -15, -1, -5, 5, 1, Figure 14 ABS Work Done and ABS Civil Commencements ($ Million) 6, 5, 4, Work done and civil commencements begin to de-couple Gap begins to widen Gap begins to narrow 3, 2, 1, Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec18 Jun 19 Dec 19 Jun 2 Total Civil Work Done (Source: BIS Oxford Economics/ABS data) Total Civil Construction Commencements Total Civil Work Done Forecast Figure 15 ABS Work Done by Sector ($ Million) 4, 35, 3, Transport Utilities Other Mining and Heavy industry 25, 2, 15, 1, 5, Jun 4 Dec 4 Jun 5 Dec 5 Jun 6 Dec 6 Jun 7 Dec 7 Jun 8 Dec 8 Jun 9 Dec 9 Jun 1 Dec 1 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18 Jun 19 Dec 19 Jun 2 13 Australian Infrastructure Metric June Quarter 217
PROCUREMENT TRENDS Circa 85-95 per cent of civil construction work won in transport, utilities and across all sectors are in the form of construct-only or design and construct contracts (see Figure 16); Design and construct contracts account for 68.1 per cent of total civil work won in terms of value, despite making up just 34.5 per cent of the number of contracts (see Figure 17); and Work won in utilities show greater diversity in contract types, in terms of the number of contracts and total value with Alliance and Other contracts together accounting for 11.7 per cent of the number of contracts and 3.8 per cent of value. Figure 16 Procurement Type: Four Quarter by Volume 1% 8% 6% 4% 2% Design and Construct (D&C) Construct only (lump sum/fixed price) Alliance PPP Other Sector wide Transport Utilities Figure 17 Procurement Type: Four Quarter by Value 1% 8% 6% 2.3% 2.% 61.2% 34.5% 6.2% 5.2% 2.5% 1.% 1.5% 68.4% 29.1%.9% 5.% 18.8% 6.7% 5.% 36.7% 51.7% 24.% 6.8% 12.% 4% 68.1% 75.3% 57.2% 2% Sector wide Transport Utilities Design and Construct (D&C) Construct only (lump sum/fixed price) Alliance PPP Other 14 Australian Infrastructure Metric June Quarter 217
15 Australian Infrastructure Metric June Quarter 217
Work Won Survey (METRIC) - Quarter Mar-1 Jun-1 Sep-1 Dec-1 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Roads and Bridges 1. 139.6 191.7 311. 6.6 27.6 43.7 12.4 54.1 94.3 46.2 47.7 31.2 67.2 136.2 Railways 1. 196.5 23. 349.2 23.1 288. 1.4 48.7 12.5 23.7 133.8 158.6 168.9 372.9 375.3 Harbours 1. 2.4 8.2 75.5 11.2 174.9 32.2 159.1 96.3 45.2 4. 5.8 17.4 4.6. Total Transport 1. 12.7 155.4 262.8 43.8 99.5 49.4 16.3 7.9 99.2 57.7 64.7 48.2 97.8 14.2 Electricity 1. 23.8 72.9 78.9 13.7 44.7 6.9 8.9 5. 12.8 33.3 27.4 1.6 76.8 6.1 Water 1. 14.4 37. 26.6 24.2 24.2 91.3 53.9 58.9 72.2 25.3 24.8 17.5 14.7 2.4 Sewerage 1. 567.2. 59.4. 719.7.. 432.4 761.6 2.9 2,353.4 1,37.6 634.1 1,92.1 Telecommunications 1... 235.9 9. 347. 161.9 52.3 419.7 113.1 189.8 75.7 519.2 1,72.3 69.2 Gas Pipelines 1. 11.3 6,746.9 721.4 77.4 64.9 5,154.9. 211.4 2,855.8.. 566.. 181.1 Total Utilities 1. 6.9 138.8 79.5 18.5 62.7 12. 61.2 84.3 88.2 4. 49.3 64.1 121.8 96.1 Electricity and Gas Pipelines 1. 23.5 246.2 95.6 15.3 45.3 14.6 8.7 54.2 86.7 32.5 26.6 25. 74.8 63.2 Total Mining 1. 56.4 127.7 142.8 224.7 24.9 16.3 15.6 222.3 161.3 59.7 145. 41.9 16.9 198.1 Total Civil Construction 1. 85.1 142.5 176.8 91.2 67. 121.2 144.2 122.3 121.1 54.1 85.3 58.1 81.5 148.1 Total Non-Mining 1. 97.4 148.9 191.3 34. 85.1 14.5 141.5 79.5 13.9 51.7 59.7 65.1 19.2 126.6 Work Won Survey (METRIC) - 4 Quarter Average - 21=1 Mar-1 Jun-1 Sep-1 Dec-1 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Roads and Bridges n/a n/a n/a 1. 94.7 79.6 59.7 31.6 3.7 39.7 4. 32.6 29.6 25.9 38. Railways n/a n/a n/a 1. 91.2 11.7 86.9 93.7 12.7 93.1 96.9 68.4 75.9 95.3 122.8 Harbours n/a n/a n/a 1. 56.5 132.2 144. 185. 226.7 163.2 167. 113.9 75.2 55.2 35.6 Total Transport n/a n/a n/a 1. 91.2 87.9 71.3 55.2 59.5 59.4 6.7 45.8 42.2 42. 54.9 Electricity n/a n/a n/a 1. 68.7 76.3 52.3 26.9 4.1 28.6 38.1 44.8 3.5 53.7 63.4 Water n/a n/a n/a 1. 71.7 41.8 62.1 72.3 85.2 13.1 78.5 67.6 52.2 3.7 22.2 Sewerage n/a n/a n/a 1. 91.5 14.5 14.5 61.2 97.9 11.5 13.2 33.3 354.7 343.9 55.3 Telecommunications n/a n/a n/a 1. 72.9 176.2 224.4 33.7 426. 356.3 364.6 237.6 267.3 552.8 71.8 Gas Pipelines n/a n/a n/a 1. 99.7 1.4 79.4 69.9 71.7 18.5 4.5 4.5 45.1 7.5 9.9 Total Utilities n/a n/a n/a 1. 78.5 79. 74. 69.2 86.5 93.3 72.2 69. 63.7 72.6 87.4 Electricity and Gas Pipelines n/a n/a n/a 1. 81.8 86.5 63.8 45.1 53.5 62.4 39.1 43. 36.7 34.2 4.8 Total Mining n/a n/a n/a 1. 129.2 121.8 129.5 131.3 13.8 162.7 139.2 137.9 95.6 61.7 94.2 Total Civil Construction n/a n/a n/a 1. 98.3 94.7 9.5 84. 9.2 1.9 87.6 75.9 63.2 55.3 74. Total Non-Mining n/a n/a n/a 1. 87.7 85.4 77.2 67.9 76.4 79.9 7. 54.8 52.1 53.1 67.1 16 Australian Infrastructure Metric June Quarter 217
Work Won Survey (METRIC) - Quarter Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Roads and Bridges 33.2 141.1 49.9 67. 23.7 115.2 293.2 181.7 224.6 51.6 131.6 47.8 123.3 16. 35. Railways 175.8 18.6 6.3 693.1 343.8 36.9 57.5 26.3 12.2 37.3 539.6 15.7 416.2 51.9 969.5 Harbours 15.6 15.1 39.3 14.8. 2.9 21.5 1.8 3.1 1.7 34.4... 5. Total Transport 5.1 114.9 41.1 147. 65.3 78.1 196.5 119.9 142.9 4.2 169.3 52. 138.1 17.6 165.3 Electricity 21.5 12.4 51.9 9.2.. 27.5. 11.7 13.9 1.6. 45.1 28.6 34.7 Water 4.4 17.9 16.5 22.8 5.5 3.4 55.9 2.3 7. 3.1 11.6 8.1 1.2 79.5 8.8 Sewerage 55.9 74.5 649.1 139.2 27.8 11. 126.4 657.5 362.2 71.7 186.6 51.5 249.3 89.4 13.6 Telecommunications... 22.5 13. 13.1 1,315.8 1,251... 35. 7.3 37.5.. Gas Pipelines 595.8 775.8 358.6 222.8 1,669.1 229.9 28.1 1,64.5 3,592. 366.9.. 115.4. 912.2 Total Utilities 2.6 24.3 42.6 19.8 25.1 6.3 131. 112.3 58.5 18.9 9.7 8.6 93.2 48.4 33.6 Electricity and Gas Pipelines 36.4 32.2 59.9 14.8 43.3 6. 34. 41.7 14.7 23. 1.6. 46.9 27.9 57.4 Total Mining 196.5 18.9 31.8 19.....3. 19.9.4 13.2 5. 6.9 6.3 Total Civil Construction 88.7 88.4 44.2 74.2 34.9 35.1 12.3 86.1 82.7 28.5 87. 28.7 86.7 23. 81.9 Total Non-Mining 42.5 79.6 49.5 97.9 49.9 5.1 171.8 122.9 118.2 32.2 124. 35.3 121.7 29.9 114.3 Work Won Survey (METRIC) - 4 Quarter Average - 21=1 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Roads and Bridges 36.1 5.9 48.6 39.2 38. 34.5 67.2 82.7 19.8 11.2 79.4 61.4 47.7 42.9 29.9 Railways 124.8 17.6 65.8 12.1 121.2 123.3 129.2 53. 15.2 15.2 7.3 84.5 13.6 132.3 181.4 Harbours 18.4 61.3 78.4 85.7 78. 28. 19.3 17.3 18.8 22.6 28.9 23.6 22.1 16.9 2.4 Total Transport 52.6 63.1 54.2 55.3 57.6 51.9 76.2 72. 84.1 78.2 73.9 63.3 62.5 59. 58.4 Electricity 61.3 62. 53. 34.5 26.7 22.2 13.3 1. 14.2 19.2 9.9 9.9 22. 27.3 39.3 Water 14.6 14.7 15.4 23. 23.4 18. 32.7 25. 25.6 25.5 9. 11.1 45.9 74.4 73.4 Sewerage 31. 228.2 229.4 78.1 75.7 78.7 34.3 78.3 16.8 157.1 162.2 11.7 11.1 49. 44.3 Telecommunications 679.3 524.7 25.5 6.7 1.6 14.5 46.2 771.9 768. 764.1 382.8 31.3 141.6 141.6 131.2 Gas Pipelines 17.7 2.5 25.2 25.8 39.9 32.7 31.7 49.9 75.3 77.1 73.4 52.2 6.4 1.5 13.6 Total Utilities 79.8 69.3 48.4 28.3 29.5 24.7 48. 72.5 81.2 84.6 52.6 25.2 34.4 42.2 48.5 Electricity and Gas Pipelines 42.9 44.4 41.2 3.8 32.3 26.6 21.1 26.9 4.1 43.7 36.7 27.8 15.4 16.4 28.4 Total Mining 16.2 121.9 125.4 83.5 37.4 11.9 4.5.1.1 4.7 4.8 7.8 9. 6. 7.3 Total Civil Construction 74.6 8.6 73.2 58.6 47.9 37.4 52.4 54.8 64.3 63. 56.4 45. 45.8 44.7 43.7 Total Non-Mining 63.9 66.6 55.5 5.1 51.5 46. 68.8 73.4 86.1 82.8 73.9 57.6 58.3 57.9 56. 17 Australian Infrastructure Metric June Quarter 217
ABOUT The IPA/BIS Oxford Economics Australian Infrastructure Metric (the Metric) is a major research initiative produced by Infrastructure Partnerships Australia (IPA), in collaboration with business research and forecasting firm, BIS Oxford Economics and Australia s major civil contractors. The Metric captures circa 3 per cent of private construction activity each quarter, using this data to model the work won (contracts signed) each quarter and forecasting construction activity levels across the coming years. The Metric provides a robust leading indicator of the strength and direction of the civil construction sector in Australia, increasing community, investor and sponsor certainty about the progress in addressing Australia s infrastructure deficit. Close to 2 of Australia s largest civil construction companies participate in this quarterly study. By capturing a substantial sample of the work won by these companies each quarter, the Metric provides a timely indicator of civil construction activity across: Total civil infrastructure investment; Civil infrastructure excluding direct mining and heavy industry construction; Transport infrastructure; and Utilities infrastructure. The Metric also captures the contracting arrangements that are being employed to deliver Australia s infrastructure, allowing for an objective measurement of procurement trends over time. This Metric edition covers the June 217 quarter; with the September 217 quarter due to be published in November 217. MARKET SHARE The Metric is presently capturing around 25 per cent of total civil engineering construction work commenced each quarter, and an average of 3 per cent of total private contract engineering construction (see Figure 18). The sample size varies considerably between sectors and sub-sectors, with the sample size for the transport and mining sectors far outweighing the utilities sector. Figure 18 Data Set Market Share Sector Total Civil Commencements Total Private Contract Civil Commencements Transport 31 43 Utilities 17 26 Mining 3 27 All sectors 25 29 CONTACTS Media: For all media enquiries please contact Sarah Dagg from Infrastructure Partnerships Australia on (2) 9152 616 or sarah.dagg@infrastructure.org.au Research: For further information on the research methodology please contact Gavin Chan from Infrastructure Partnerships Australia at gavin.chan@infrastructure.org.au Other: BIS Oxford Economics forecasts for civil construction work done appearing in this report are sourced from: Engineering Construction in Australia 216-23; Mining and Heavy Industry Construction in Australia 214 to 228; Road Construction in Australia 213 to 228 For more information on BIS Oxford Economics civil construction forecasts please contact Adrian Hart on (2) 8458 42 or ahart@bis.com.au