Macmahon (MAH) H2 2024 earnings summary

Executive summary

• Achieved record FY24 revenue of $2.0bn, up 7% year-over-year, with record underlying EBITDA of $351.7m (up 13.9%) and underlying EBIT(A) of $140.3m (up 20.3%), despite labor shortages and commodity price volatility.

• Underlying NPAT(A) rose 36% to $91.9m; statutory NPAT was $53.2m, impacted by a $31.8m impairment of a receivable from Calidus Resources.

• Successfully executed strategic priorities, including the $104m acquisition of Decmil, accelerating civil infrastructure growth, diversifying revenue streams, and expanding workforce to nearly 10,000.

• Maintained a robust order book of $4.6bn and a tender pipeline exceeding $21bn, with $2.0bn of FY25 revenue already secured.

• FY24 marked the eighth consecutive year of meeting or exceeding market guidance.

Financial highlights

• Revenue increased 7% to $2.0bn; underlying EBITDA margin at 17.3% and EBIT(A) margin at 6.9%.

• Underlying NPAT(A) margin at 4.5%; free cash flow more than doubled to $74.5m; underlying operating cash flow was $301.0m.

• Net debt reduced by 27% to $146.6m; gearing at 18.8% and Net Debt/EBITDA at 0.42x.

• Total dividend increased 40% to 1.05cps, payout ratio of 24% on underlying EPS.

• Capital expenditure was $207m in FY24.

Outlook and guidance

• FY25 revenue guidance: $2.4bn–$2.5bn, with $2.0bn already secured; underlying EBIT(A) guidance: $160m–$175m.

• Capex for FY25 targeted at $233m, including $200m sustaining and $33m growth capital.

• Strong order book and high level of secured work support positive outlook; focus on growth in lower capital intensity segments and Decmil integration.