NRW soars despite mixed full-year results

NRW Holdings expects to earn as much as $155 million from operations in the current financial year, while announcing a fully franked final dividend of 5 cents per share.

It comes despite NRW posting a $14.6 million drop in net profit after tax (NPAT), to $75.1 million for the year ended June 30.

Today, the contractor said it had about $2 billion in work secured for the 2022 financial year, from which it expects to generate between $145 million and $155 million in operating earnings.

Investors welcomed the news, with NRW's share price closing 17.4 per cent higher to $1.96.

That's despite the company posting mixed full-year results, with the decline in NPAT a result of cost increases associated with NRW's projects in the Pilbara.

The company said border closures, labour rate increases, and skill shortages had a major impact on operations, affecting staff retention and recruitment.

Its operating earnings, as a result, were down 14 per cent to $120.6 million in FY21.

Managing director Jules Pemberton said the challenges had impacted project completion costs and schedules.

“Both these issues were attributed to COVID-19 measures including border closures which limited the available workforce,” he said.

“Most of those projects however were complete at 30 June 2021, other than resolution of claims and contract variations.

“Whilst these projects have had the most impact on our financial performance it is important to note that large parts of our business have performed to expectations.”

NRW posted a 6.7 per cent increase in underlying earnings to record $266.7 million in FY21, leading to an 11.5 per cent increase in revenue to $2.3 billion, in line with guidance.

The board has declared a fully franked final dividend of 5 cents per share, to be paid on October 13.

That brings the total dividends paid in FY21 to $40.4 million.

More to come.