GR Engineering Services’ shares were up 10 per cent this morning when the company posted a significant jump in revenue and earnings.
GR Engineering Services’ shares were up 10 per cent this morning when the company posted a significant jump in revenue and earnings.
Ascot-based GR Engineering’s revenue grew 76 per cent in the year to June 30 to $392.4 million, while its underlying earnings more than doubled to $37.2 million.
The company attributed the result to strong contracting activity and a solid operational performance amid challenging conditions, as a result of COVID-19 and a tightened labour market.
GR Engineering is now out of the red, having posted a net profit of $23.2 million, up from a $7.2 million loss in FY20.
The company was trading 10.5 per cent higher on the news at 1:05pm AEST to $1.61 per share.
Managing director Geoff Jones said the engineering and construction contractor had been able to complete projects on time and within budget.
That includes work at Northern Star Resources' Thunderbox and Carosue Dam operations, and at Salt Lake Potash's Lake Way development.
“The safe and successful delivery of these projects reinforces GR Engineering’s reputation as a proven process engineering design and construction contractor,” Mr Jones said.
“GR Engineering continues to meet the challenges associated with COVID-19 and the tightening of the Australian labour market, and importantly has been able to generate strong operational cashflows, earnings growth and returns to its shareholders.”
He said GR Engineering’s oil and gas business, Upstream Production Solutions, won significant contracts in FY21 including from clients operating in the Perth Basin and the Northern Territory.
In December, Upstream secured a $130 million contract from the federal government to provide operations and maintenance services to the floating Norther Endeavour vessel in Timor Sea.
Earlier this year, GR Engineering acquired global firm Mipac for $21 million in cash and scrip, a move intended to bolster Upstream’s service offering.
“The post-merger integration process has been seamless to date,” Mr Jones said today.
“The strategic acquisition of Mipac during the year provides GR Engineering with an opportunity to offer advanced standalone control systems engineering, automation and technology solutions to its clients.”
GR Engineering ended the year with $69 million in cash, up from $37.5 million in FY20.
The board has declared a final, fully franked dividend of 7 cents per share, to be paid on September 22. It brings the total dividends in FY21 to 12cps.
