Perenti increases work in hand

Perenti has secured the following new work and contract extensions:

• $70 million, six-month contract for the continuation of underground development and production works at the Regis Resources Garden Well and Rosemont underground gold mines. Barminco and Regis continue to progress collaboratively towards further and material contract extensions at these two mines.

• $27 million, 24-month contract for exploration surface drilling services at the BHP Mitsubishi Alliance in Queensland.

• $14 million, 24-month contract award for underground diamond drilling works at Catalyst Metal’s Plutonic underground gold mine in Western Australia, subject to finalisation of contract terms.

Furthermore, AUMS (through UMA, a joint venture with Rocksure International) received a Limited Notice to Proceed related to the initial underground development works at the Newmont Akyem underground gold mine located in Ghana. The finalisation of contractual negotiations continues, however, once finalised it is forecast that the contract could represent ~A$32 million (US$21 million) of revenue over an initial term of 11 months, with a capital structure that is likely to be similar to that adopted for Newmont’s Subika project.

Mark Norwell, Managing Director & Chief Executive Officer of Perenti, said “The award of these contracts and the Limited Notice to Proceed across both our underground and surface mining businesses demonstrates the diversity of our service offering and the strength of the relationships we share with our clients. Collectively these three contracts and the Limited Notice to Proceed represent nearly A$150 million of revenue across FY2024 and into FY2025 and come after the recent announcement in which Perenti secured ~A$360 million of revenue at the Sandfire Resources A4 project in Botswana.”

Perenti awarded US$235 million contract expansion at Motheo

Perenti is pleased to announce our surface mining business in Africa, African Mining Services (AMS), has been awarded the contract for open pit mining services at the Sandfire Resources A4 open pit within the larger Motheo Copper Mine in Ghanzi, Botswana. The contract is valued at US$235 million (~A$360 million) over a term of 73 months.

Under the terms of the contract, AMS will deliver all surface mining services associated with development and production activities at the A4 open pit. The A4 open pit is located approximately 8km to the west of the Sandfire’s existing T3 Open Pit, where AMS has successfully progressed from development into production works. Perenti anticipates A4 pre-production and development work to commence in September 2023, with pre-strip mining to start in October 2023.

The T3 and A4 open pits are expected to be operated as a larger, integrated mining operation and therefore will leverage the resulting benefits of scale and the operational synergies to optimise the return on capital aligned with our financial targets. The primary synergies include the optimisation of existing infrastructure, mining equipment, maintenance facilities and both technical and operational management. Perenti’s current FY24 guidance (as released to the ASX on 22 August 2023) already takes these operational synergies and capital efficiencies into account and includes the respective A4 revenue and earnings, although as with every opportunity we will be looking to generate further value for our client and shareholders.

Mark Norwell, Managing Director & Chief Executive Officer of Perenti said: “We are excited about the opportunity to expand our partnership with Sandfire Resources. Motheo is a long-life asset in the Kalahari Copper belt, and the expansion of our role here is in keeping with our strategy of disciplined growth within top-tier mining jurisdictions with high quality partners. Sandfire is now one of our largest clients and over the term of the combined contracts, the T3 and A4 open pits are expected to generate total revenue of over A$1.1 billion, delivering strong returns for Perenti and its shareholders.”

Paul Muller, President of Contract Mining said: “Since Barminco commenced operations in 2019 and AMS later in 2021, Perenti has established itself as the leading international mining contractor in the Kalahari Copper belt. With the award of our third mine in the region, we look forward to playing our part in Sandfire’s expansion of their world class Motheo Copper Mine. Beyond this, I am proud of the contribution Barminco, AMS and Perenti continue to make to the development of Botswana’s mining industry and the community more broadly.”

Perenti delivers record financial performance in FY23

Perenti has delivered record FY23 financial results, headlined by record revenue and record underlying earnings. The sustained improvement in financial and operational performance has placed Perenti in a strong financial position, which enabled the announcement in June 2023 of the value accretive acquisition of Australian-based drilling business DDH1, with final completion expected in October 2023.

Mark Norwell, Managing Director & CEO of Perenti, said: “Perenti continues to go from strength to strength, as the foundations we have laid with our 2025 Strategy allow us to deliver excellent operational performance, strong client relationships and disciplined commercial and capital management.

“Year-on-year we delivered significant revenue and earnings improvement as our growth projects continued to progress through their respective ramp-up phases, as our strategy enabled each of our businesses to capitalise on and take full advantage of the improvement to macro-economic conditions, including the ‘end of COVID’ and as we saw continued strength in markets for the metals and minerals we mine on behalf of our clients. Although I would note that various macro-economic challenges still exist, however we are cautiously optimistic.

“Our ~9,000 people have again demonstrated their commitment to continually doing better, every day, for our clients. On behalf of the Board and Group Executive I sincerely thank them for their contribution to the business.

“Perenti is focused on supporting sustainable mining, with our investment in developing mines for the future, and our focus on reducing our own emissions.

“Perenti has a strong track record of delivering value and certainty for all of its stakeholders. As we look to the future, our proposed acquisition of DDH1 will complement and enhance the Perenti business and further cement our diversified global value proposition.”

You can read more about Perenti’s FY23 Annual Results on our Investor Centre.

Perenti committed to achieve gender balance in signing up to 40:40 Vision

In celebration of International Women’s Day 2023 and the focus on #embracingequity, we are pleased to announce Perenti has signed up to the 40:40 Vision, and in doing so, we have committed to achieve gender balance in our Board and executive leadership by 2030.

Perenti’s commitment to 40:40 is a pledge to have Board and Executive representation of 40 per cent women and 40 per cent men by 2030 with 20 per cent any gender.

Managing Director & CEO Mark Norwell said Perenti had joined other listed companies in signing up its support for industry super fund HESTA’s 40:40 Vision.

“Perenti recognises the business and social importance of achieving gender diversity. Participating in the 40:40 Vision is a way of furthering this commitment and ensuring we hold ourselves accountable to these targets and are transparent about our progress.

“A key finding of our It’s Not OK program, which aims to eliminate harmful behaviour in our workplace, is that in order to build a safe, diverse and inclusive workforce where people are respected for who they are, we must improve female participation across the business at an accelerated rate.

“There is clear evidence that gender balance in leadership is not only fairer, but also very positive for overall business performance.”

Perenti first half FY23 results and business update

Perenti has released its financial and operational results to the market for the first half of FY23.  

Mark Norwell, Managing Director & CEO of Perenti, said: “First and foremost, my thoughts are with the families, friends and workmates of Trevor Davis and Dylan Langridge, our colleagues who tragically lost their lives as a result of the incident at the Dugald River underground mine last week. This is a tragic incident and a devastating loss, with a magnitude that has been and will continue to be felt across our whole organisation. I would like to thank everyone who carried out the search and rescue effort for Trevor and Dylan last week as well as the wider organisation for their support to people directly involved in the incident or more generally, the care provided to each other.

“During the period from 1 July 2022 through to 31 December 2022, Perenti’s ability to deliver for our clients with strong operating performance under a sustainable and disciplined financial framework – while caring for our people and communities – underpins our strong results for this half.

“Our dedicated team of over 9,000 employees have done a fantastic job of developing and executing our 2025 Strategy to the point where we have delivered consecutive periods of earnings and margin expansion. This result is something for everyone at Perenti to be proud of.

“We recognise that the current external market conditions have improved since Covid-19 restrictions started to ease and that our business is in a position to take advantage of these conditions. However, we are also acutely aware of the potential volatility that still exists and we working to manage the controllable aspects of this environment by remaining disciplined in the execution of our strategic objectives.”

You can read more about Perenti’s first half FY23 results and business update here.

Ausdrill secures contract extension at Fimiston

Perenti has announced that its subsidiary Ausdrill, has been awarded a new Australian surface contract at the Northern Star Resources owned Kalgoorlie Consolidated Gold Mines (‘KCGM’) Fimiston open pit gold mine in Kalgoorlie, Western Australia. The new circa $160 million, 60-month contract incorporates activities that commenced 1 March 2022 and will continue to March 2027.

Ausdrill has been contracted to provide up to 14 production blast hole drill rigs to support ongoing operations. Given the scale and quality of its existing Ausdrill fleet, Perenti does not expect any new capital outlay to support this contract.

Mark Norwell, Managing Director & CEO of Perenti said, “We continue to remain focused on supporting the families, friends, and colleagues of Trevor and Dylan following the tragic incident at the MMG owned and Barminco operated, Dugald River mine in Queensland last week. However, over the weekend Ausdrill executed a material contract and in-line with our disclosure obligations, we are providing the market with an update.

“We have secured our largest ever surface contract in Australia, which continues our relationship at one of Ausdrill’s first ever projects. We are very proud to be part of Kalgoorlie’s history and we look forward to continuing to deliver certainty and value for Northern Star, our employees and business partners.”

He added, “Since the release of our operational update on 19 December 2022, we have continued to deliver on our strategic objectives and while we have seen some strengthening of the Australian dollar relative to the US dollar, we have seen overall margin improvement and continued to win or extend existing contracts, positively resolve commercial negotiations and further simplify our business. Market conditions continue to remain favourable into the second half of FY23 in support of further delivery against our 2025 strategy. We look forward to providing additional details when we release our 1H23 results tomorrow.”

Paul Muller, President Contract Mining at Perenti said, “Ausdrill began with two drill rigs in 1987 at the Fimiston mine. Since then, Ausdrill has continued to expand its services to include blast hole and grade control drilling, utilising a fleet of drill rigs specifically designed and manufactured (in-house) to meet the unique specifications required by the Fimiston open pit mine.

“We look forward to continuing to provide our value-add expertise to the KCGM operations while extending our long-standing relationship with our local and regional stakeholders.”

Perenti secures contract extension at the Mako Gold Mine in Senegal

Perenti is pleased to announce that its surface mining business in Africa, African Mining Services (AMS) has been awarded a contract extension for surface mining activities, including load and haul, drill and blast, grade control and crusher feed, at Resolute Mining’s Mako Gold Mine in Senegal. The contract is valued at approximately US$185 million over a period of four years, commencing 1 January 2022.

Through AMS, Perenti has provided surface mining activities at the Mako mine since 2017. This contract extension includes updated commercial conditions and in-line with Perenti’s Capital Management Policy, the Company will optimise the management of existing fleet and equipment at the project, which is forecast to have a low capital expenditure requirement and generate sustainable returns.

The extension of the Mako contract does not have a material impact on Perenti’s FY23 guidance, which remains unchanged and as announced on 19 December 2022.

Mark Norwell, Managing Director & CEO of Perenti said “The Mako project has been a part of the AMS portfolio for several years and we are pleased that our strong operational performance and relationship with Resolute Mining, has allowed us to execute this contract extension, which supports our 2025 Strategy. We are confident that our dedicated, predominantly local workforce will continue to deliver value for our client. We look forward to continuing our relationship with Resolute Mining at the Mako project as we seek to deliver enduring value and certainty for all our stakeholders.”

Perenti announces FY23 guidance upgrade

For the second time this financial year, we are pleased to provide an operational update and deliver an upgrade to our FY23 guidance.

Since the initial guidance revision in November, Perenti has continued positive momentum, securing improvements to commercial conditions across a number of Australian and African projects. In addition, our subsidiary Barminco has been awarded a new contract at Evolution’s Ernest Henry underground gold and copper mine in Queensland as well as secured a variation to expand its work scope at Regis Resources’ Garden Well mine.

As a result of these positive developments, the revised FY23 guidance now puts expected revenue between $2.7 billion and $2.9 billion and EBIT(A) between $230 million and $250 million.

Perenti CEO and Managing Director, Mark Norwell said: “Together, over the last four years, our 9,000 dedicated employees have been unrelenting in delivering on our purpose of creating value and certainty for our stakeholders. Over these four years, by being smarter together and by taking no shortcuts, Perenti has navigated a period of unprecedented uncertainty and, whilst challenges still exist, we are now seeing the significant effort of our people translate into value upside to our shareholders.”

He added, “In addition to generating greater returns in FY23, we are focused on continuing to pursue business and project optimisation initiatives which will facilitate the delivering our 2025 strategy. Our Strategy is designed to drive positive momentum in shareholder value well into the future. Perenti’s outlook is underpinned by our world class Contract Mining Division, and the continued development of our Mining Services and idoba Divisions. Our focus on generating enduring value for our people, clients and communities, will ensure we continue to deliver sustainable returns for our shareholders.”

You can read the full story in our Investor Centre.

Perenti and ABB agree to jointly explore solutions to help mining customers decarbonise operations

Perenti has signed an agreement with leading global technology company ABB to collaborate and explore approaches to support net zero emissions targets for underground and open-pit mines. Experts from the two companies will work together to address electrification in mine hauling operations, power distribution, energy efficiency and power management.

Perenti’s significant mining expertise and technical capability will be complemented by ABB’s technology expertise. Together, the teams plan to explore business models and solutions to provide wider services for pilot, brownfield and greenfield mining customer projects to support the electrification of operations.

ABB has been calling for open collaboration within the mining industry and has taken action on several similar initial non-binding agreements to build commitments with original equipment manufacturers (OEMs), technology innovators and mining companies. Key relationships have subsequently been formalised, with technologies and solutions created as a result of these deals.

“Mining customers are committed to facing environmental, societal and economic challenges head on as they aim to decarbonise mining operations,” said Joachim Braun, Division President, Process Industries, ABB. “With ABB’s sector leading position in electric-mine technology development, and Perenti’s excellence and experience in mine development and mine operations, the scope of this collaboration is a perfect opportunity to make real progress in providing electric solutions that will decarbonise the industry.”

Mark Norwell, Perenti Managing Director & CEO with Joachim Braun, Divisional President, Process Industries, ABB

“ABB and Perenti share a vision to develop energy efficient solutions for the mining industry,” said Mark Norwell, Managing Director & CEO, Perenti. “By combining our experience across mining operations and digital solutions with ABB’s leading technologies we are focused on supporting the decarbonisation of mining through electrification. We look forward to working with ABB on this exciting new venture.”

ABB is committed to creating sustainable progress for today and for future generations by helping mining customers through their energy transition. ABB launched its ABB Ability™ eMine portfolio of technologies and methodologies last year, an approach to make the all-electric mine possible, with fully integrated electrification and digital systems from mine to port.

Perenti is committed to acting on climate change through promoting innovation, developing and deploying low emissions technology and working with its clients to implement projects that improve energy efficiency and reduce emissions. 

You can read the full story in our Investor Centre.

Perenti secures additional ~$520 million of Australian revenue with new Cowal Underground contract

 

Perenti is pleased to announce that its Barminco underground mining business has been awarded the contract for all underground development and production works for Evolution Mining’s Cowal Underground project in New South Wales.

Barminco, a leading global underground mining services business, with operations in Australia, Africa and North America, is currently developing an exploration decline and conducting diamond drilling services at Cowal. The award of this new contract significantly expands Barminco’s scope at the site to include the development of a second portal, all underground development and production works, and associated underground mining services required to support the continued mill feed of underground ore.

Mark Norwell, Managing Director and CEO of Perenti said the award of the Cowal contract aligns with Perenti’s strategy of increasing its earnings in top-tier regions and with top-tier clients.

“The Cowal contract represents one of the largest underground mining projects in Barminco’s history, generating revenue of nearly $520 million with an initial term of four years, from a contract commencement date in early July 2022,” Mr Norwell said.

“This contract award represents not only a significant expansion and continuation of our first underground contract in New South Wales but is also a fantastic opportunity for Perenti to build on our strong working relationship with Evolution, one of Australia’s premier gold mining companies.”

Mining Chief Executive Officer, Paul Muller said, “Our purpose is to create enduring value and certainty for our clients, our people, our shareholders and the communities in which we work. At Cowal we will prioritise local and indigenous training and employment and local procurement opportunities while maintaining a transparent and consistent approach to community and indigenous engagement. We look forward to working with Evolution to develop a safe, sustainable, highly-productive world class operation in New South Wales.”

To read the ASX release visit the ASX announcements section of our website.