NRW Holdings profit slumps

NRW Holdings has reported a 54 per cent fall in its first-half net profit as a challenging market and slow ramp-up in projects slashed its earnings.

In the six months to December 2013, the mining contractor posted a $22.4 million net profit compared with $48.6 million in the previous corresponding period.

It also experienced a 36 per cent fall in revenue to $520.9 million.

Despite the profit slump, NRW increased its order book by $300 million to $1.3 billion over the period.

Its tender pipeline currently sits at about $3.3 billion.

NRW chief executive Jules Pemberton said the company was forecasting a more positive immediate future on the back of new projects and a stronger balance sheet.

“The business was awarded a number of new contracts and extensions during the half, collectively valued at $820 million,” he said.

“Securing these contracts has helped maintain the group’s order book stability over the medium term.”

The company was awarded a $620 million earthworks and construction contract at the Roy Hill iron ore project in September, and has also recently secured work with mining giants Fortescue Metals Group and BHP Billiton.

NRW has reaffirmed its full-year revenue guidance at between $1 billion and $1.2 billion.

It has also announced a fully-franked interim dividend of 4 cents per share, a 50 per cent payout ratio on half-year net earnings.

NRW shares closed the day’s trade 9 per cent lower at $1.30.