Leading national mining and civil contractor NRW Holdings Limited (ASX: NWH) has announced its financial results for the six-month period to 31 December 2022, reporting strong revenue growth, an increase in interim dividend and confirmation of its full-year EBITDA guidance.
Half-year results highlights:
- Revenue $1.3 billion, up 15% on pcp – in line with guidance.
- EBITA $80.1 million, up 7.4% on pcp – in line with guidance.
- EBITA for FY23 full year guidance maintained at $162 million to $172 million.
- NPATN $50.4 million, up 3.9% on pcp.
- Cash balance at 31 December $154.8 million – expected reduction from FY22 year-end as part of normal operations.
- Final FY22 dividend paid during the half of $31.4 million, increased from pcp of $22.5 million.
- Net debt increased to $172 million to fund new fleets on Karara and Kogan Creek mining projects forecast in FY22 but incurred in this period when delivered. Gearing remains prudent at 28.5%.
- Strong order book of $4.9 billion.
- Pipeline remains robust at $19.3 billion, with $4.1 billion of submitted tenders.
- Interim dividend increased to 8.5c per share unfranked, up from 5.5c franked pcp.
Commenting on the results, NRW managing director Jules Pemberton said:
“These strong results reflect the consistent and steady delivery of our strategy. The diversification of the group’s business model over recent years has allowed us to rapidly respond to the variable and challenging market conditions resulting from the continued tight labour market conditions, inflationary pressure environment and the La Niña weather patterns in Queensland.
“I am very proud of the way in which our workforce has managed through these constantly changing conditions and has remained focused on profitably growing our business over the past six months, safely and sustainably.
“Over the period we have extended a number of our long-term contracts, extracting additional value from the secured order book, and secured a number of new strategic contracts. We have maintained a very disciplined approach to bidding for new work, which has meant that we have at times not won projects that we were well positioned to secure. Whilst disappointing to come second to a competitor, our people know the criticality of pricing our bids responsibly in line with current market conditions.
“Revenue and profits have increased relative to the prior comparative period, however margins have been impacted by the La Niña weather pattern, higher levels of overheads due to the delayed commencement of new work, longer tender cycles and investment in building capacity in Primero’s North American delivery capability to support growing client demand in Canada and the USA.
“The group’s cash balance decreased in the six months, which was expected, resulting from the unwinding of project advances received in prior periods, and the investment in working capital for the new long-term mining contract awards and extensions. This is expected to recover over the remainder of the year as these contracts mature.”