NRW Holdings (ASX:NWH) share price soars 13% on FY21 earnings

Here’s how NRW performed during the financial year just been.
The post NRW Holdings (ASX:NWH) share price soars 13% on FY21 earnings appeared first on The Motley Fool Australia. –

The NRW Holdings Limited (ASX: NWH) share price is soaring after the company released its results for the financial year 2021 (FY21).

Right now, the NRW Holdings share price is trading at $1.88, 13.3% higher than its closing price yesterday.

NRW share price jumps on $2.3 billion revenue

Here’s how the diversified contracting service provider performed during FY21:

$2.3 billion in revenue – 11.5% more than in FY20

Earnings before interest, tax, depreciation, and amortisation (EBITDA) of $266.7 million. That’s 6.7% higher than the prior comparable period
5-cent fully franked final dividend.

Of the company’s approximately $2.3 billion of revenue, its civil works segment brought in $726.5 million, mining brought in around $1.177 billion, and minerals, energy, and technologies earned $426.9 million.

NRW’s operating earnings before interest and tax came in at $120.6 million. That’s lower than it was in FY20, mainly due to high staff turnover, labour rate increases, and skill shortages in Western Australia’s Pilbara region.

NRW ended the period with $163.9 million of cash and $196.7 million of debt.

What happened in FY21 for NRW Holdings?

It was a busy financial year for NRW Holdings and its share price.

The company acquired Primero Group Ltd in March.

It also developed and installed pit crushing and conveying solutions to reduce its carbon emissions by at least 75% when compared to traditional mining and haul solutions.

Unfortunately, COVID-19 impacted the company’s staff retention, with staff turnover reaching record highs.  

Border restrictions still mean interstate worker numbers are far below pre-pandemic levels. NRW historically sees 30% of its workforce coming from Australia’s east coast.

What did management say?

NRW Holdings’ managing director and CEO Jules Pemberton commented on the results, saying:

The COVID-19 pandemic has had a significant impact on the business throughout the financial year…

Resource availability and labour cost pressures impacted WA Pilbara project completion costs and schedules. Both these issues were attributed to COVID-19 measures including border closures which limited the available workforce.

Most of those projects however were complete at 30 June 2021, other than resolution of claims and contract variations. Whilst these projects have had the most impact on our financial performance, it is important to note that large parts of our business have performed to expectations.

What’s next for NRW Holdings?

Here’s what may drive the NRW Holdings share price in FY22.

The company is forecasting its revenue for FY22 will be between $2.4 billion and $2.5 billion. $2 billion of its expected revenue is already either in NRW’s order book, supported by a letter of intent, or is expected to be reoccurring.

NRW anticipates its operating EBIT for FY22 will be between $145 million and $155 million.

Additionally, the company’s order book is expected to grow by $1 billion to $4.4 billion in FY22 after NRW received a letter of intent for the extension of mining services at Curragh.

Additionally, NRW is preparing its first sustainability report. It will be published in September.

NRW Holdings share price snapshot

The NRW share price has slipped 37% year to date. It is also 9% lower than it was this time last year.

The post NRW Holdings (ASX:NWH) share price soars 13% on FY21 earnings appeared first on The Motley Fool Australia.

Should you invest $1,000 in NRW Holdings right now?

Before you consider NRW Holdings, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and NRW Holdings wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

Afterpay (ASX:APT) share price edges higher as ‘Afterpay Day’ kicks off
Origin (ASX:ORG) share price slides 5% after revenue decline
Why the IGO (ASX:IGO) share price is sliding 8% today
Perpetual (ASX:PPT) share price falters after reporting 9% profit fall
South32 (ASX:S32) share price drops on US$195 million net loss after tax

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!