Perenti has delivered interim financial results in-line with our internal expectations, positioning the Company to meet full year guidance in FY25. The strength of existing work in hand was demonstrated by revenue for the first half exceeding the prior half and establishing a new record.
As guided to the market after the full year results in August 2024, the first half result for FY25 was expected to deliver a lower percentage of operating cash flow and lower EBIT(A) than the second half. This skew was further exacerbated by the late receipt of $42.4 million of debtors subsequently paid in early January 2025.
The Board and Management remain confident in the strong free cash flow of the underlying business and improving outlook across all divisions. This enabled the declaration of a 3.0c per share interim dividend, compared to 2.0c per share paid at the end of the previous corresponding period.
Mark Norwell, Managing Director & CEO of Perenti, said: “At Perenti we continue to demonstrate the strength and resilience of our business model to generate consistent cash-backed returns through fluctuations in commodity and market cycles.
“This resilience comes from establishing a global and diversified portfolio of mining services and our scale, particularly in underground mining and drilling. The strong free cash flow generated by Contract Mining and Drilling Services has allowed the reduction of gross debt during the period, ongoing share buybacks and the declaration of an increased interim dividend.
“The Drilling Services division, formed in FY24 from the combination of Ausdrill and the four DDH1 businesses, is now showing clear cost synergies, in addition to the cash tax synergies. The increased scale of the division is evident when in December 2024, Perenti Drilling Services was reported to be the second-largest global drilling group when measured by total metres drilled3. The division is operating well and is positioned to capitalise on increasing exploration activity expected in the coming months.
“Another example of the advantages of the portfolio approach was seen in Contract Mining, which once again delivered strong performance despite financial underperformance from the Zone 5 underground project in Botswana and the closure of three underground Australian nickel operations during the last 12 months. This reiterates the benefits of both our scale and the commodity agnostic nature of our underground operations. We are not dependant on any single project and the scale of our operations allows reallocation of people and equipment between projects, retaining key employees and reducing capital expenditure requirements.
“Our performance is due to our people, and I am immensely proud of our dedicated teams worldwide who consistently deliver exceptional services to our clients. We prioritise and value the safe and sustainable delivery of our services because we want our people to return safely at the end of every shift. On behalf of the Board and Group Executive, I sincerely thank them for their ongoing contributions.
“Perenti will continue to focus on delivery of value and certainty for all stakeholders. To clearly demonstrate this commitment, we reaffirm our guidance for FY25. We expect to deliver revenue of between $3.4 billion and $3.6 billion; EBIT(A) of $325 million to $345 million; leverage of between 0.6x to 0.7x; net capital expenditure of ~$330 million; and free cash flow greater than $150 million.”
To read our full 1H25 results visit Investor Centre.
