The NRW Holdings (ASX:NWH) share price has plunged 16%. Here’s why

The NRW (ASX: NWH) share price is plunging today, down 16% in early afternoon trading. We look at the company’s latest results.
The post The NRW Holdings (ASX:NWH) share price has plunged 16%. Here’s why appeared first on The Motley Fool Australia. –

falling asx share price represented by toy rocket crashed into ground

The NRW Holdings Limited (ASX: NWH) share price is plunging today, down 16% at $2.35 in afternoon trading.

Let’s take a look at the mining and construction services provider’s results for the first half of the 2021 financial year ending 31 December.

What financial results did NRW Holdings report?

In this morning’s release, NRW reported a range of strong results. However, today’s sharp share price fall is possibly due to a sizable drop in profits in the half-year.

The positive results include record first-half revenue of $1.168 billion. That’s an increase of 44% from the previous corresponding period.

Earnings before interest, tax, depreciation and amortisation (EBITDA) also increased, up by 28% to $132.8 million compared to H1 FY20.

Profits, however, were down. The company reported NPATN (which incorporates earnings before amortisation of acquisition intangibles and non-recurring transactions costs at normal 30% tax rate) of $40.3 million. That’s down 12% from the $47.6 million reported in the prior corresponding period.

NRW reported a cash balance of $171.4 million and said it had reduced its net debt by $43.2 million to $96.5 million.

The company also confirmed it was moving to compulsory acquisition to take over Primero Group Ltd (ASX: PGX).

Management comments

Looking ahead, NRW CEO Jules Pemberton said:

Growth is expected to continue as a result of increasing expenditure on infrastructure projects at state and federal level, demand for commodities remaining strong and as a consequence of the recently announced Primero acquisition…

The addition of Primero to the MET business represents a further diversification of our strategic platform to offer clients continuity of services across the whole lifecycle of resource projects – from early planning, design, development, construction to operations and maintenance.

Our exposure and now strengthened capability to participate in the future energy minerals and renewables sectors is also set to grow through Primero’s existing client base…

NRW will pay an interim dividend of 4 cents per share, up 60% from the first half of the 2020 financial year.

NRW share price snapshot

After being savaged during the wider COVID-19 market selloff last year, NRW shares are up 114% from their 19 March 2020 lows. Even with that gain, shares are still down 19% over the past 12 months. By comparison, the All Ordinaries Index (ASX: XAO) is down 1% over that same period.

Year-to-date, the NRW share price is down 21%.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Bernd Struben 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.

The post The NRW Holdings (ASX:NWH) share price has plunged 16%. Here’s why appeared first on The Motley Fool Australia.

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!