Leading national mining and civil contractor NRW Holdings (ASX: NWH) has advised that its subsidiary Primero Group Limited and Wärtsilä Australia Pty Ltd have agreed a confidential out-of-court settlement of the civil proceedings related to the Barker Inlet Power Station (the Project).
Wärtsilä was engaged by AGL to engineer, procure and construct the Project. Primero was engaged by Wärtsilä to perform civil, mechanical and electrical installation works and supply tanks pursuant to a subcontract dated 18 April 2018. Facility completion in respect of the Project was certified in June 2020.
NRW acquired Primero in February 2021 and made full provision against the receivable that Primero carried in its books in relation to the dispute.
While the detailed terms of the settlement are confidential, Primero is required to make a payment to Wärtsilä of $25 million, which will be reflected in NRW’s FY24 statutory earnings.
NRW’s normalised FY24 EBITA guidance, excluding the once-off impact of the settlement payment, remains unchanged at $175 million to $185 million.
“This matter is historical and predates NRW’s 2021 takeover of Primero. It in no way reflects on Primero’s new executive team and current employees. Primero and indeed the wider METs group has never been in a stronger position with $1.4 billion of secured orders and over $1 billion of active tenders,” NRW managing director Jules Pemberton said.
“Further, as outlined in the Group’s FY23 results announcement, with the migration to more balanced risk-sharing contract structures in the current project portfolio, I am confident in Primero’s ability to deliver far better financial performance in FY24, driven by the very strong demand for the business’s services. The Primero team is fully focused on the delivery of their FY24 order book.”
