GR delivers in tough market

GR Engineering Services wrapped up the 2016 financial year with record revenue and increased profit, but says competition for design and construction opportunities remains high.

Perth-based GR posted net profit of $19.3 million for FY16, up from its $12.9 million result last year, with revenue up from $216.9 million to $255.3 million.

Earnings before interest, tax, depreciation and amortisation increased by $5.8 million to $26.1 million.

The company declared a final dividend of 5 cents per share fully franked, for a full-year payout of 10 cents per share.

“Having commenced FY16 with a healthy order book, GR has maintained its focus on performance and delivery, which supported the achievement of strong financial results,” managing director Geoff Jones said.

“The company has been able to maintain steady earnings growth and incremental improvement in returns over the past four financial years, amongst a backdrop of volatility in commodity prices and resources related capital expenditure over this period.

“Strong leadership throughout our business and the retention of a loyal, committed workforce has resulted in the group maintaining industry leading operational capability and the ability to service clients in a safe manner to make important contributions to their projects.

“Importantly, GR Engineering enters FY17 with adequate work in hand and opportunities for further engagement on projects that we are well placed to undertake both in Australia and overseas.”

GR expects pressure on the limited number of design and construction opportunities to remain competitively high.

The company enters FY17 with $115 million in contracted revenue for the year, and expects revenue to be broadly in line with its FY16 result if it maintains conversion rates.

GR shares were 0.9 per cent lower to $1.49 each at 11am.