Decmil boosts order book to $590m

Contractor Decmil Group has secured new work, including with Main Roads Western Australia, totalling $47 million.

Main Roads has tasked the company with completing roadworks on Great Eastern Highway, specifically the realignment of a two-kilometre section, the reconstruction of two intersections, and the removal of redundant surfacing.

Decmil has also won a contract from Shell’s QGC business to design and build a modular accommodation village in Queensland.

Work under both contracts is expected to begin and complete within the next financial year.

The new work has boosted Decmil’s order book to $590 million.

The company, which suffered a significant blow last year when it lost a major contract with New Zealand’s prisons department, is targeting lower-risk projects with blue-chip clients in the resources and infrastructure sectors.

Chief executive Dickie Dique said the new contracts aligned with this strategy.

“Each of the contracts with customers we’ve previously delivered work for, highlighting Decmil’s operational excellence,” he said.

“Our order book is expanding as we start to see the award of some contracts that were previously delayed due to COVID-19.

“This primes the company for a significant FY22, with circa $400 million [contracted and preferred] work in hand already booked in for the next fiscal year.”

Osborne Park-based Decmil had revealed delays in the awarding of contracts and project starts earlier this month, which led it to lower its full-year earnings guidance to the $300 million to $320 million range (down from $360 million).

However, Mr Dique says Decmil is poised for growth next financial year, following a phase of consolidation in FY21.

Its shares were up 3.3 per cent at 12:48pm on Wednesday to trade at 47 cents.