The Downer EDI Limited (ASX: DOW) share price is lifting today on news it has been awarded a new Telstra Corporation Ltd (ASX: TLS) contract.
The post Here’s why the Downer (ASX:DOW) share price is edging higher today appeared first on The Motley Fool Australia. –
At the time of writing, the Downer share price is up 2.2% to $5.48.
New contract win
In today’s release, Downer revealed that it has won a field services contract by Telstra for infrastructure works. The deal, worth approximately $330 million, will run over a 4-year period, with a possible one-year extension.
Under the agreement, Downer will carry out a number of services, which include:
- Network asset relocations;
- Wideband business services;
- Facilities design and construction activities including Telepower and building upgrades; and
- Continuation of the 5G mobile rollout;
The works are scheduled to commence this month across New South Wales, Victoria, Tasmania, South Australia and the Northern Territory.
Quick take on Downer
Downer is an integrated services company that operates primarily in Australia and New Zealand.
The multi-functional company has three divisions: infrastructure, mining and rail. These industries move into market sectors such as minerals and metals, oil and gas, power, transport, telecommunications, water and property.
Most notably, Downer is a leading provider of fixed and wireless network services and one of the largest constructors of telecommunications carrier networks.
What did the CEO say?
CEO Grant Fenn welcomed the extended partnership, saying:
Downer has been working closely with Telstra for over a decade and we have earned a reputation as a high-quality contractor trusted for our delivery excellence.
Downer is proud of our involvement in the Field Optimisation initiative assisting Telstra as it simplifies its business. We look forward to continuing our partnership with Telstra and transitioning into the new Field Services contract.
Downer share price snapshot
The Downer share price has been trekking higher over the last 9 months, since its steep fall from COVID-19. Reaching as low as $2.58 in March, the company’s shares stand at a 112% increase over the period since.
Based on its current share price, Downer commands a market capitalisation of $3.3 billion.
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Motley Fool contributor Aaron Teboneras owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.