Strong first half for Monadelphous

Monadelphous Group expects its full year revenue to rise by 10 per cent, on the back of strong first half results for the 2024 financial year. 

The engineering company's revenue hit more than $1 billion during H1, FY24, which was up 5.8 per cent, or $953 million, from the prior corresponding period - stemming from the acquisition of $1.8 billion worth of contract extensions and new work. 

Up until December 31 2023, Monadelphous' maintenance and industrial services arm generated $708 million, which rose by 4.6 per cent from H1, FY23, while the company's engineering and construction division generated $303.1 million.

"With labour and supply chain capacity constrained, the company will continue to leverage its strong position and take a strategic and targeted approach to new work, engaging and collaborating early with its customers, focusing on earnings quality and maintaining an appropriate approach to the allocation of risk," Monadelphous said.

"Supported by a strong balance sheet, Monadelphous will continue to assess potential acquisition opportunities to facilitate service expansion, market diversification and long-term sustainable growth."

The Victoria Park-based company also recorded a net profit after tax of $30.1 million, up 3.2 per cent from $29.1 million during H1, FY23 - while its earnings before tax, interest, depreciation and amortisation reached $61.3 million, adding 5.3 per cent, or $58.2 million, from the prior corresponding period.

Additionally, the company's cash balance soared to a record $263.3 million, which was also aided by contracted work gains.

In December last year, the company secured $215 million worth of contracted work from Albemarle, Chevron and BHP, while it also benefited from a three-year contract extension to its maintenance and shutdown services agreement with Woodside Energy. 

On January 17 2024, Albemarle told the market it was scaling back plans to expand its Kemerton lithium refinery in Western Australia's South West, instead focussing on construction of a third production train, and deferring a planned fourth.

Monadelphous' $200 million deal with Albemarle relates to providing work for the company's initial two trains - from a front-end pyromet structural, mechanical, piping, and electrical and instrumentation works perspective. 

The engineering company's Board of directors have also confirmed an interim dividend of 25 cents per share, which will be fully franked.