No sign of mining services slowdown

PERTH-BASED engineering and construction contractors have released a spate of record earnings reports, while bulging order books suggest there’s plenty of life in the resources boom.

NRW Holdings, GR Engineering, Decmil Group, and MACA became the latest engineering and construction outfits to report record financial performance for the year ended June 30, joining prominent resources players Monadelphous and Macmahon Holdings.

NRW announced net profit of $97.1 million for financial year 2012, with revenue rising by 82 per cent to a record $1.358 billion.

The company paid a final dividend of 10 cents per share, taking its total full-year dividend to 18 cents.

NRW managing director Jules Pemberton said all of the company’s divisions recorded revenue growth and increased profitability during the financial year.

Mr Pemberton said the company’s Action Mining Services division also recorded impressive revenue growth, up 65 per cent on FY2011 at $46.6 million.

He said NRW was targeting growth in both revenue and earnings of at least 15 to 20 per cent in FY13.

Meanwhile, Decmil Group reported a net profit of $39.1 million, an increase of 66 per cent on the previous year, on the back of a 41 per cent jump in revenue to $555.6 million.

Decmil paid a final dividend of 7.5 cents per share, taking the total dividend paid over FY12 to 10 cents per share.

Chief executive Scott Criddle said the past 12 months had been a record period of growth and profitability for the company, and he was similarly confident that the good fortune would continue for at least another year.

“We have also worked hard to increase our exposure to the oil and gas sector, which is a major strategic focus for the company as we look to build on these results in 2013 and beyond,” Mr Criddle said.

“With many of the nation’s largest LNG projects coming on stream from 2014, our exposure to the sector will be a significant contributor to future revenues.”

At GR Engineering, sales revenue hit a record $152.8 million, though net profit slumped to $13.1 million.

The company paid a fully franked final dividend of 4 cents per share, taking its full-year dividend to 8 cents per share.

Managing director Joe Ricciardo said the company was expecting revenue and net profit growth in FY13 to be similar to that just reported.

Another Perth-based engineering group to post a record profit was MACA with a 34 per cent jump in revenue to $334.9 million, which drove a net profit spike of 39.1 per cent, to $37.7 million.

MACA paid a final dividend of 4.5 cents per share, while its order book stood at $1.3 billion as of June 30.

The contractor joined Macmahon Holdings and Monadelphous, which both reported record financial performances last week.

Monadelphous managing director Rob Velletri said earlier this week there was a strong pipeline of engineering and construction opportunities in WA that would continue to keep workshops busy.

The company secured around $2 billion of work in 2011-12.

“While there has been some recent market commentary about potential delays and uncertainty of commitments to future new projects, the current crop of approved projects, particularly in the LNG sector, will drive strong demand for the next few years,” Mr Velletri said.

Macmahon was similarly bullish about the state of its order books after lodging a record net profit of $56.1 million, on the back of $1.9 billion in revenue.

Macmahon boss Nick Bowen said the company’s order book stood at $3.1 billion at June 30.