Emeco (EHL) H1 2025 earnings summary

Executive summary

• Delivered strong earnings and margin growth in 1H25/HY25, with 11% revenue growth (excluding discontinued contract mining), 6% increase in operating EBITDA to $145.8 million, and 15% rise in operating NPAT to $38.3 million, driven by robust rental demand and cost management.

• Statutory NPAT rose 73% to $33.6 million, reflecting new rental projects and cost savings.

• EBITDA margin expanded by 610bps to 38% and EBIT margin by 360bps to 18%, reflecting operational efficiency.

• Free cash flow increased 22% to $49 million, with cash conversion at 94% and leverage reduced to 0.84x.

• Focused on core equipment rental and maintenance services, exiting lower-margin contract mining activities.

Financial highlights

• Revenue (excluding contract mining) up 11% year-over-year to $387 million; operating EBITDA up 6% to $145.8 million; operating EBIT up 13% to $68.3 million; operating NPAT up 15% to $38.3 million.

• EBITDA and EBIT margins improved to 38% and 18% from 32% and 14% year-over-year.

• Free cash flow of $48.8 million, up 22% year-over-year; cash conversion at 94%.

• Net debt reduced to $242.2 million from $280.5 million at June 2024; leverage at 0.84x.

• Basic EPS increased to 6.53 cents from 3.75 cents year-over-year.

Outlook and guidance

• FY25 operating EBITDA guidance reiterated at $300 million, with similar H1/H2 skew as FY24.

• Sustaining capex for FY25 expected at $160–165 million; no growth capex planned.

• ERP spend for FY25 to be $7 million; focus on digitisation and operational technology.

• Weather events in Queensland and WA may impact utilisation and project timing.