Thanks very much, Steven Boland here, and thanks to people who have taken their time this morning to, in a very busy period of the year, obviously, to go through the Acrow FY25 Results. I'm joined by Andrew Crowther, our CFO, and Matt Caporella, our COO, who will assist me today with the presentation. I'm going to walk through the investor presentation that was released to the ASX last night, and we'll be happy to answer questions at the conclusion of the presentation. Firstly, just the overview of the business. Competitive advantages remain as they have been for a number of years now around engineering expertise, general quality of our people, our product range, and geographic footprint. A few things that I'll point out here that I think have significantly changed with our greater impact now of our industrial access business.
Seventeen depots in the country in the business now across six states. An average of 921 FTEs, which is obviously significantly up with the penetration we've had in the industrial business. The sectors that we service, we've got a growing emphasis now in areas of utilities, defence, and marine. We'll talk quite a bit about that as we go through the presentation as it refers to the industrial sector. Obviously, two acquisitions last year, actually three, sorry, if we include the training business ATEC that we purchased. Since we listed in April 2018, the business has now made six acquisitions, and we've made four industrial acquisitions in the last 18 months, plus the training business. We're in a very busy period for us in that particular area.
The strategic sort of direction and principles for the business, I don't think they've ever played out stronger than they have in the years just past, and also, as I think, going forward. The strategy of the business to diversify our revenue streams across a range of areas and placing an equal importance on our formwork and industrial access business has significantly paid off for us in the last 12 months. It's fair to say now that we service two specific sectors across the broad Acrow business. We service the construction sector via our formwork business, including our screens and jumpforms offerings, and then the smaller commercial scaffold business. We service the broader industrial sectors and across a range of different areas through our industrial access business.
I think those on the call who would be looking at construction service-oriented businesses over the last 12 months would see that most have had a modest but reasonable decline in earnings over that period. I think for Acrow, that would have probably also been the case if we hadn't diversified as strongly as we have into the industrial sectors. We're maintaining a disciplined approach to return on investment, both on CapEx and M&A. We're still maintaining a 40% hurdle rate for capital.
In terms of the acquisitions over the last, well, certainly over the whole journey, but these last four acquisitions in industrial that we've undertaken, including all of the costs, upfront costs of due diligence and advisor fees, et cetera, and then the costs, significant costs that we do incur integrating those businesses into Acrow, if you fully load all of those costs into those businesses, the average return multiple on EBITDA that we're getting is about 3.7. Our hurdle rate for acquisitions is about a 4x multiple. We're doing better than that if you fully load in also costs for upfront for advisor legals, et cetera, and also for integration costs. The Acrow way of operating, we've spoken about this a fair bit. It's around safety, people development, engineering, internal product development, customer service, and having a best-in-breed approach. That's certainly still the case.
Moving to what the last year has really been about for us, it's been a year of positioning ourselves for what we know is ahead of us. There is significant growth going to happen in the core business of formwork certainly over the next five years, and probably in the next 12- 18 months, we'll start to see strong evidence of that. We've earned the right through how we've been able to develop that business to invest in other areas that have just made us a stronger overall business over the last 12- 18 months. Firstly, in our capital program, we spent a total of $32.7 million on growth CapEx last year. $25.2 million of that was spent on growing our industrial business, our jump form business, and our screens business, which are all currently growth engines of the business.
As we move into the new year, we expect to spend around $22 million on growth capital in the new year, and $21 million of that will again be in those core areas. It can be seen that in the existing, if you like, core formwork business has undertaken significant growth over the last six to seven years to get us to a position of being the market leader in this country in the higher-end silo formwork. We're actually not investing much money in capital in that area at the moment. We anticipate in the next few years, as activity levels significantly lift, there may be a requirement to change that profile. At the moment, we've taken the opportunity to significantly grow industrial jump forms and screens and maintain a 40% hurdle rate.
The industrial business has been really the story of the last couple of years and the story of this year. It can be seen on page seven of the Prezo, how the revenue for that business has grown from $40 million in FY23 to $132 million in FY25. It's both via acquisition and organic. It's a business that we now really, you know, we think it's a significant still growth path in front of it. It provides annuity earnings, provides stability of earnings, long-term blue chip contracts. It is less capital intensive when it's in growth mode than formwork is when formwork is in growth mode. As I said, it's both by acquisition and organic. We acquired Above Scaffolding and BRAND in May. Very exciting opportunities off both those businesses opening up new sectors for us, especially in the areas of defence and asset maintenance.
I'll talk a bit about that as we go through the presentation further. We've taken the opportunity to grow this business primarily via debt. In the four acquisitions that we've made over the last 18 months, around about $70 million of those acquisitions, the cost of those acquisitions has been funded via debt. That's been a specific choice of Acrow to do that rather than go to the market and raise capital and dilute shareholders. This business this year is pushing towards $200 million in revenue. It has around about $130 million basically secured in contract work as we go into the start of the year. Of course, one of the major impacts this year or last year for us that flows into the next few years was the Perdaman contract in Western Australia, which was the first major contract we've won in the industrial space in WA.
That's about a $45 million contract over about a 30-month period. The other two major growth channels for the business are jump forms and screens, and they work together here, and they are working every day more and more together. The jump forms we started from scratch in 2022. We're now up to $10.5 million or $10.4 million worth of revenue in this area in 2025, up to $3.6 million last year. You can see now the spread across the country of work, and you can see primarily there, a lot of work in Western Australia. I'll get to that, the relevance of that as it now applies to the screens business.
In the screens business, while you do see a $1 million reduction in revenue year- on- year, you can see that there's an $11 million uplift in work secured in the screens business that will flow through into 2026. In the screens business, the dynamics are we're getting significant market share gains in New South Wales. We're always strong. We're now by far the market leader in New South Wales, and we've now a national business. Now, WA , I think, is the burgeoning story as it relates to screens, and it's off the back of our penetration in jump forms. Just last month, we won a $900,000 screens job in WA , the biggest job we've had in that particular area that also has jump forms and traditional formwork included in the package. It's about a $2.3 million job overall.
I think we expect to see a significant uplift in revenue coming out of a screens business in Western Australia. I'll hand over to Matt and Andrew now to talk about the sort of the workforce issues, training, development, supply chain, and back office growth issues. Matt, over to you for the first points.
Thanks, Steve. As Steve said, we're positioning for growth so far. The four of these categories are the workforce, our training, development, supply chain, and the ERP. With the workforce, we currently now have over 500 staffholders, skilled laborers consistently working across the country. We've got the ability now to draw on this pool of labor and provide confidence in delivering on the larger scale projects. A prime example of this was probably the WA Perdaman project, which now has 75 staffholders rotating on site. We were able to scale this up within six months, starting effectively from zero in WA. We had no staffholders in WA in December. Another key differentiator in the labor force is our engineering team. We're up to 63 engineers now across the country.
This is probably the single largest formwork and industrial access design team in the country, which allows us to turn around projects quickly and on short notice as well. Training and development. Our cadet program and grad program now is in its third year of official infancy. High retention rates and success rates in this program too. We had over 80% last year. We're getting two to three cadets transitioning from cadets into grads each year. This is across engineering, HR, and finance. One of the biggest achievements last year really was the acquisition of ATEC in Southeast Queensland. That's a registered training organization. ATEC's well regarded in the industry as providing high quality, real-life scaffold training. It's not just a tick and flick business. We now have expanded on this into Mackay in July.
We opened a new facility on the back of our MI premises dedicated to training scaffolders. This is allowing us now to build our lab pool by upskilling scaffolders, but also providing realistic real-world training on the complex and skilled work we do in the industrial access space. It's not just standard scaffolding, it's quite complex. On the product supply chain front, we've now developed a pretty flexible and well-developed supply chain. This is on the back of pushing into developing our own product and owning the IP. The same thing here with the Perdaman project. We're able to deliver 1,000 ton of our Uni-Ring onto that project in a short timeframe, within a few months from contract award, by maintaining price competitiveness and high quality. I'll pass over to Andrew to talk about the ERP.
Thanks, Matt. One of the things that we've identified pretty quickly is we've secured our labor and supply chains, and we've got pretty outstanding training and development. We haven't spent a huge amount of money on our back office system. Our main enterprise resource management system is over 20 years old. It's fair to say it needs an upgrade. The board made the decision that we need to start doing an end-to-end review of our business systems. This is basically end-to-end. We've kicked off a business-wide business process project, which includes the ERP system and other ancillary systems. Our objective here is basically to digitize, have a system that's scalable, and basically provide us efficiency and looking into the future.
At the moment, when we get an acquisition, and we have had a few acquisitions, as you know, there's a lot of work, and it is a little bit inefficient to get them onto our current system. We're going to be investing between $1.5 million- $2 million to put these systems in. This will see us into the foreseeable future and have us really positioned for growth. Thanks, Steve.
Okay. Thanks, Matt and Andrew. You see in those categories that there's an upfront capital spend. There's a real drive in doing industrial. There's a real drive in the jump forms and screens, and then the support to that in terms of people, systems, and product. In terms of the FY25 highlights, I've spoken a fair bit about this stuff already, so quickly, obviously, 50% of the group revenue now comes from industrial, significant growth. The Perdaman contract, renewing the BMA contract from Mackay was a major achievement, underpins the profitability of that business going forward. The Above and BRAND acquisitions in May, jump forms and screens. We've had some real success now on winning work on the Gold Coast with Meriton in screens, and we've now won a significant jump form contract that is significant in terms of both the size, but the complexity of the job.
Matt, I might just hand back to you now quickly on that particular jump form because it is potentially industry changing when it gets up and running.
Yeah. In this market, this is a 77-story tower that we're working on in the Gold Coast called Cypress. With these larger towers, the differentiator is they have what's called mega columns around the external. There are 16 columns that on this project, we're actually forming all at once and climbing every single column at the same time with our screens below them. Effectively, you push a button and the whole system will climb in one operation. It's going to provide safety, efficiency on site, and speed. We're using a lot of our own standard kit that we've already developed in the jump form system with a few new products that we've had to develop. This is a fully acquirable, reusable system. We've developed this that could basically be replicated on any future large-scale multi-story tower.
Okay, thank you. I mean, it's probably fair to say that once this is proven, it's got massive applications across a range of other jobs that currently don't have that kind of system in place. We also had another good, strong year and higher contract secured of 27% up. I'll talk a bit more about that in a second because the dynamic of that in terms of where we've won that work has changed quite significantly over the last couple of years. In terms of safety, very strong results again, especially when you consider the increased activity in the industrial access labor area. The financial metrics, 23% up in revenue, EBITDA 8%. Look, I'm not going to sugarcoat it.
It's actually an absolute testament to the diversification strategy of the business that in an environment when the core construction sector was actually relatively soft, we were still able to improve our profitability by 8% via the growth in industrial and also jump forms and screens. 4% up in net PAT underlying. I will say on the NPAT stat that is down, $6 million of that reduction relates to an earn-out payment for MI that we had to expense in the first half and also a range of costs that we incurred for both the upfront advisor fees and due diligence, et cetera, for the acquisitions, including about $750,000 for an acquisition that we didn't then go ahead with.
I talked about in the first half, we made a decision that culturally it was wrong and it was wrong to go forward, even though we did spend a lot of money on the process. It was better to pull out when we did. You can see that if without the acquisition style expenses, the NPAT would have actually significantly, the stature of the NPAT would have significantly increased year- on- year. EPS was relatively flat for the year, down 3%, and we're declaring a dividend for the full year of $0.0585, exactly the same as what it was last year. It's now really important for our stakeholders and shareholders to understand the differences in margins generated by formwork and industrial and how they will influence the overall result for Acrow.
As our industrial revenue becomes a greater proportion of our mix, you can see that the industrial margins are around 36%- 37% at a sales contribution level, where the formwork are in the 70s. This is purely because there's so much higher in formwork. It's 100% pass-through. There is a lot of labor, obviously, in the industrial business. Now, I think the thing that I want to point out, I've been pointing that out for some time, but I hope it's understood. We're making a 25% margin on the labor in our industrial access business. I would challenge anybody to show me a business that is a labor business that makes a 25% uplift on its labor. That business, life for life, is performing incredibly well. There is this mix between those two businesses that changes that contribution margin from 62% down to 54% year- on- year.
The actual margins in both of the divisions are basically flat. We're not cutting prices, reducing margins in either formwork or industrial. In terms of the financial track record of the business, again, you can see good growth in revenue and EBITDA CAGR. The return on equity reduced year- on- year. It's off the back of the reduced profitability that came out of the core business this year versus the previous year that we know will return itself to the other way in the next couple of years going forward. It's been pointed out before, but I'll just point it out one more time for the sake of it. The EPS between 2023 and 2024 had a significant impact with tax of about $8 million. It is flat year- on- year this year, which is basically off the back of some additional shares being issued.
The big change was that we paid about $8 million more in tax than we used to pay between 2023 and 2024. Dividends were flat year- on- year. Secured higher contracts were up 27%, which was in total about $21 million. Now, $14 million of that growth were in jump forms and screens. This is to understand that dynamic change between what we've always seen is you win at one year, you get the higher revenue the next. When you're predominantly winning work in screens and jump forms, there is a far longer gestation period for that work than general formwork. You win a screens job, the job I mentioned in WA that we won last month, that won't start from May next year.
You get about six to nine months traditionally with jump forms and screens from winning a job to it starting, whereas with traditional formwork, you win a job, you start it within four weeks. That will return itself as the formwork market starts to pick up, as it will over the next 12 months. We've got a number here now for the labor hire forward order book. We've got $230 million of secured labor hire in our industrial business going forward. This year, that number is in excess of $100 million just for this year. You can see the pipeline at $217 million continues to be strong. In terms of the divisional breakdown and operational update, Andrew will go through more of this.
The things that I will point out primarily on page eight under the Prezo is that you can see clearly, we did get a $6 million reduction in our formwork contribution with a $20 million increase in our industrial access contribution. We did a fantastic job of maintaining the costs in our yards. Despite increased activity in industrial, the reduced activity in formwork meant we were able to keep our yard expenses reasonably flat. The labor increase in overheads is just, we're positioning this business for the next surge. You will go through years when you're going to need to invest more in safety. You're going to need to invest more in accounting. You need to invest more in engineering. That's what Acrow has been doing over the last 12 months. That won't replicate itself this year.
We did also have quite a significant reduction in bad debt expenses year- on- year last year of about $1.2 million. You can see in the sales contribution bridge again, the growth in industrial to offset the softer conditions in the core business. In the formwork division, so I've called this out and I'll call it out again, it was a soft year. Primarily in Southeast Queensland, although WA and SA were also soft in that year and are now turning around as we go into FY26. The margins are consistent in this business. Across the states, Queensland, whilst it shows a small increase from 2024 to 2025, that's in the jump form business. If you take the jump form revenue out of that in Queensland, the core Queensland formwork business reduced by about $4 million- $5 million.
Victoria, those again who are following our story know we've done significant work on a couple of the major infrastructure projects. Was that big uplift from 2023 that went from $7 million to $28 million? To hold it at 2024 last year, we're actually very, very happy with that result. We are transitioning in Victoria from West Gate and CYP Metro Rail onto North East Link and Suburban Rail, and we'll talk a little bit about those in a second. New South Wales continues to do well, going from over a three-year period, basically doubling its formwork revenue. You can see the reductions in SA and WA . Both of those markets are turning around this year. In the case of SA , primarily off the back of the T2D Project, so the Torrens to Darlington motorway project, where significant revenues are now kicking in.
In WA , it's off the back of now cross-selling jump form, screens, and formwork, where we'll see the majority of our growth in the next 12- 18 months. In terms of the marquee projects, just to give this, this was across the journey over the last few years. Metro Tunnel's finished. West Gate Tunnel's finished. Cross River Rail is finished. North East Link is going. Sydney Metro is going. Snowy Hydro is going. Coomera Connector Stage 1 is finished. Stage two and three are yet to commence. Kidston is ongoing. As we go forward, we'll talk about the new projects that are going to kick in in this space. Industrial access. I mean, one of the great things for me here is the labor margin is 24.6% this year versus 23.5% last year.
The reduction in contribution margin is just a function of the mix between labor and hire and sales in the revenue. Great to see that it's not all acquisition-related growth in the revenue. There is $25 million of organic growth in here, which incorporates Perdaman. Obviously, we've called out that the BMA contract for the Bowen Basin renewal and just recently now the Origin Energy contract, Surat Basin renewal. Marquee contracts in this space are all ongoing. Snowy, Kidston, Perdaman, Ampol, Visy Tumut, Origin, Hay Point, Sun Metals, they are all ongoing contracts. All of them have probably a minimum of two to three years to run. Some of them are a lot longer than that. This group of six contracts is generating circa $100 million in baseline revenue in this year. Commercial scaffold, I don't want to be rude, but it's a rounding error, to be honest.
It's a commodity business. We talk about it all the time that, you know, there's a baseline revenue. It can be up from that and down from that. I would call it at the moment about par. It will probably go up again, probably not this financial year, but next financial year. As we start leading towards that Brisbane Olympic Games area, where there'll be a shortage of gear, rates will start to go back up again. I would encourage people not to look at this number and expect it to be, I mean, I think that sort of the $12 million contribution is about a par number. Some years it'll be lower than that. Some years it'll be higher than that, but that's about par. Over to Andrew.
Hi, Steve. Thanks very much. Over to slide 27, the P&L.
Steve's already gone through the EBITDA increasing from $74.6 million to $80.2 million, and the EBITDA margin slightly reducing from 34.7% to 30.3%, which was purely about sector mix rather than actually losing margins itself. Getting down to pre-tax profit, depreciation was up 15% from $20.7 million to $23.9 million. That was just basically a function of last year's total full-year PP&E depreciation of $30.4 million and this year's CapEx plus the acquisition. Our average PP&E went from $154 million last year to $188 million this year. The actual average depreciation's actually come up a little bit, but it's pretty standard to the past. Net interest up 34%, $7.8 million to $10.4 million. In general, that's because of the acquisition and the increase in debt from the CapEx and acquisition. Our average bank debt went up from $60.2 million to $95.6 million.
The actual weighted average interest rate was up a little bit, but it's relatively flat. Pre-tax profit $46 million up to, pretty flat at $46 million to $46 million. Tax expense, as a tax expense as a percentage of stat pre-tax profit, is about 33%, and that was pretty flat for both years. The reason that's above 30% is because of the share-based payments and some other black hole acquisition expenses that are of a capital nature. The tax expense was pretty flat. We get down to an NPAT underlying $33 million last year up to $34.3 million this year. From an earnings per share, it fell from $0.1154 down to $0.1117. The reason for that fall was actually the denominator, the weighted average shares increased from 295 million up to 313 million. That was a function of last year's equity issues.
When we acquired MI, we issued 18 million odd shares, plus we did the DRP underwrite last year. That was the full year impact of that, plus around 5 million of LTVR shares this year that were transferred into shares. It was actually a denominator impact of the EPS this year. When we then get from underlying down to stat, it's pretty obvious you can see there was a lot of significant items this year, and I'll start below. Steve has already mentioned the MI contingent consideration. When you make an acquisition, you have to make a call on these contingent earnouts about what payout you're going to do. We did some analysis on this that ended up being wrong in a good way. We assumed the earnout would be paid out at about 50%, and it ended up being paid out at the full amount.
Because of that, we had to expense the difference. That's the $2.6 million expense there in significant items. Also, amortization of intangibles went up from $0.9 million to $1.9 million. That increase is because of the year's amortization of non-goodwill intangibles in Benchmark and MI , plus the two months of BRAND and Above . The intangible assets have gone up from $16 million to $22 million. That gets amortized at roughly around over 10 years. We had share-based payments expense, $3.3 million down to $1.1 million. We did a reversal of $1.5 million during the year because of the earnings per share. Our LTVRs are split between a TSR outcome and an EPS outcome. Obviously, because of the EPS, the EPS part did not fulfill the requirements, and that was written back. We had other significant items of $5.4 million.
Almost most of these related to acquisition and integration. As they've said, we acquired Above and BRAND . We also acquired ATEC, and there was due diligence and so forth. We also did all the integration of MI and Benchmark . Even though we acquired those in the previous year, there was a lot of integration, yard integrations, system integrations, and this stuff is extremely expensive. Plus, we had the failed acquisition that was roughly $750,000 that's in that number as well. We had existing depot relocations, and this stuff is very expensive, plus the ERP. This was a year of a whole lot of consolidation acquisitions that came along with significant items. From a dividend point of view, $0.0585, so still a dividend yield of 6%. Moving over to the balance sheet, slide 28.
As before, this year, the balance sheet and cash flow is a result of a lot of movement in the year from acquisitions of BRAND and Above , and in particular, funding these things from debt. The balance sheet was moved. We had CapEx of $40 million. We had acquisitions of Above and BRAND of about $34 million from an asset point of view, and these were all funded from debt. We didn't raise any equity in the year for this. That's where you see our assets going up from $312 million to $405 million, but our net debt increased from $68.6 million to $123.3 million. That increase, we chose to do this. It meant that our net debt to EBITDA went from 1.1 to 1.8. That was a choice.
We could have raised capital, but we didn't feel at this point in time that that was necessary given where the business was. Where we see it from a forecast point of view, without any acquisitions and with just normal cash flow, we believe that net debt to EBITDA will head down towards 1.4 at the end of the year. From a cash flow conversion rate, we had around a 71% conversion rate compared to 76% last year. Also, working capital to sales was around 26.7%- 27% to last year's 23.5%. It's very important to point out we had a bit of a timing issue on this. We had two of the biggest sales or revenue months of Acrow's history in May, the two biggest.
Sorry, the two biggest of Acrow's history. If you had a look at it, the average, what we had, the average sales of May and June was $31.3 million. If you look at the previous 10 months, it was $20.2 million. It was around $22.3 million of extra revenue in those last two months. When you adjust both the EBITDA and you adjust the working capital for the impact of that, we had actually had receivables go up for $20 million. If you actually adjust for the impact of that, our working capital to sales would have been closer to 20%, and our cash conversion would have been around just below the 80% mark. It was heavily impacted by those last two months. When you get down to the net debt bridge, we've obviously gone from $68 million up to $123 million.
If you look at the third column, that's the working capital impact. That $20 million was very heavily impacted by those last two months. That was about a $20 million increase in receivables. When you move over to the right, you can see that we've had growth of CapEx, acquisitions, net of cash, and the deferred payments and earnouts. That's about $58.2 million. Of that increase from $68 million to $123 million, you can see there's a $58.2 million impact from growth initiatives, including growth CapEx and acquisitions. That's a choice. Moving over to the debt finance quickly, we did two restructures during the year of our debt, both in October, which we talked about in half year, of $56 million and May of $20 million. The reason we did this was to provide flexibility for any acquisitions we did.
That's why, that's the reason we did these acquisitions of BRAND and Above with debt. Even at the end of June, we still had a $40 million headroom, which we're very comfortable with. The thing about that is that provides a lot of flexibility for our industrial access business and the upfront payment of labor. It did come with a net debt to EBITDA of 1.8. If we take off the trailing EBITDA of BRAND and Above , the pro forma is just under 1.6. It's still probably higher than what we want, but it's still with all of this, it's still within what our expectations are with net debt to EBITDA. With that, I'll hand over to the practice, Steve.
Thanks, Andrew. Just wrapping up with what the growth sort of opportunities are. Firstly, look, activity forecast in the construction area continued to be strong in terms of the four to five-year cycle. I think we still realize there's a lack of housing in the country. There's a lack of medium density housing. Simple infrastructure was booming. There's probably been a pause, and it's about to go again probably in the next 18 months. Clearly, especially in Queensland, activity levels in Southeast Queensland are going to be at an all-time high within the next 24 months, 36 months. In our industrial access business, some really, really exciting opportunities are presenting themselves off the back of the Above and BRAND acquisitions. Above have a significant contract at Garden Island in defense, which I think I can mention.
There is an opportunity to do off the back of that, look at other defense-style contracts across the country. The defense sector, I think we're all following this. The defense sector is going to be one of the biggest growth areas in the Australian economy over the next decade. Getting into that area with maintenance of both the sort of the naval fleets and the submarine fleets and potentially the building of the submarine fleets is a very important area. Off the back of Above, we think we can do that quite well. The other thing that Above brings to the table, working in conjunction with BRAND, is asset maintenance. The Sydney Harbour Bridge is the primary coffer in that space for us in terms of opportunity. Above have a contract there at the moment.
I might just let Matt quickly talk about one particular innovation that has not been signed off yet, but if it comes off, there's a significant opportunity for us to grab further revenues with Above on the bridge. Matt, you want to just cover that, please?
Yeah, the Harbour Bridge is quite a complex project. We're actually scaffolding the top cords of the bridge, which means we're actually working over the live traffic lanes. Now that they've got access to the Acrow kit of products, there's stuff in our kit that we can effectively build, effectively a crash deck over three lanes of the Harbour Bridge. Our current proposal now is to build effectively a 12-meter wide deck over the bridge so we can basically work at any time. We're not limited to lane closures and that sort of side of the bridge, and really improve the efficiency of actually building this stuff because the Harbour Bridge just needs to be basically repainted. This is only one span of what could potentially be 30 spans of bridge.
The existing contract with Above is a $4.5 million grant contract for one very small component of it. This issue with working over live traffic has been a prohibitor in terms of further contracts being awarded and the time it takes to do the work. Coming up with this solution that Above wouldn't have been able to do by themselves, but in combination with Acrow, is a massive opportunity for that business now to improve its revenues on that project. There is a lot of opportunity between BRAND and Above now in terms of kit cross-pollination. It's really becoming clear that, in fact, it's clearer than it was when we were even doing the acquisitions of how all these businesses can work together to open up new opportunities. We're targeting organic growth in WA and SA.
We are pausing on M&A activity for this year unless something absolutely ridiculous presents itself. There have been some opportunities that we've decided to park for the time being. We definitely think we can grab WA and SA organically. Part of our CapEx budget for this year allows for us to do that. -e're spending roughly $3 million- $4 million on our new Uni-Ring product that Matt will just talk about at the beginning in a second, primarily for those two markets. Actually, on that subject, I'll pass over to you, Matt, on product development.
Yeah, as Steve mentioned, the Uni-Ring, that's been the key focus with the Cypress Meriton jump form that I mentioned before. The Uni-Ring, we own a Ringlock product in our fleet that we've basically been buying from someone else for the last couple of years. On the back of Perdaman, we've made the call now. We've got our own product called Uni-Ring, and it's fully compatible with all our existing fleet. Up to date now, we've actually landed over 2,500 tons of this material in six months. We've been working really big on the scalability of this. We have the ability now to land 2,000 tons a month if we do need to with really short lead times. We're working heavily on improving manufacturing facilities and geographies as well, not just focusing on one location.
The other big portion of product development that's really shining at the moment was the Acrow Deck product we brought in in 2023. We've now got 18,000 sq m of Acrow Deck around the country, really highly utilized now in New South Wales and Queensland, especially with a solid order book, especially in New South Wales. We've sold over $3 million worth of this kit now. With this sort of product, that's good. It locks formworkers specifically into a system, and they're continuing now to top up with hire on the back of that. It also brings cross-selling opportunities with jump forms and screens. We're seeing that now in WA with the project Steve mentioned with one in last month.
Okay. In terms of major projects, we are still a civil infrastructure company. We're not only that now, but we're sort of very proud of the position we've got ourselves into over the last five years in civil infrastructure. There is a surge of projects that either have just recently commenced or will kick in in the next 12- 18 months. Suburban Rail Loop, we're on it now. North East Link, we're on it in a big way. T2D, Torrens to Darlington, we're on it. It's just starting, and we're on it. Melbourne Airport Rail has been signed off to go, hasn't commenced. Queensland hospital upgrade is at its infancy. We're on it, but it's got a lot of leeway in front of it.
Brisbane Olympics obviously hasn't commenced, and we won't see anything really out of that probably this financial year, but we think that's a significant, that's going to be the big growth opportunity for Acrow over the next two to three years. Sydney Metro West, we're on it. Coomera Connector, the first stage has been completed. We were doing about $250,000 a month of revenue high on that job. It's been completed. It stops now. Stage two commences around January this year, and in stage three, we expect stage two and stage three to be the same sort of generation of revenue for us. In terms of the observations for this year, the industrial access division will continue to grow. I think we're going to push up towards $200 million of revenue. We could actually still exceed that with some contract wins that we're targeting in SA and WA .
As I mentioned, the acquired businesses give us real cross-selling opportunities and growth in sectors like defense and asset maintenance. We're going to pursue that growth in WA and SA through organic and through contract wins rather than by M&A at the moment. The screens and jump form businesses will continue to expand nationally. We're particularly excited about the opportunities for screens and jumps in WA now. I don't want to pause the investment in those areas. They are high returning, especially screens. Screens is probably our best returning investment, CapEx project product that we have. I think we're going to continue to see a relatively soft general formwork business, especially across the first part. Project delays are still a factor. WA and SA are certainly going in the right direction.
There is a bit of a cycle going through in New South Wales and Victoria of civil projects sort of concluding and new ones starting, as I've mentioned before, around Victoria. The medium-term outlook for this part of the business, I mean, one of our directors yesterday described it as the hockey stick, and I absolutely think that's correct. We're probably at the bottom end of the hockey stick at the moment, and in the next 18 months, it's going to skyrocket. It's gone from where it is at the moment. It will skyrocket in the next 18 months to two years. As I mentioned, we're definitely going to have a pause on M&A. We've got a lot to do to consolidate what we've already done. We're still in the acquisitive business. We'll go back to that at some point.
We just don't think that within this financial year, that's the right thing to do, given we've had, we said, four acquisitions plus the training business in an 18-month period and it's time to settle that down and move on. With that, thank you, and I'm happy to pass forward the form of any questions.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Our first question comes from Philip Pepe with Shaw and Partners.
Hi guys. Congratulations on the results and the conditions. Thanks for taking the question. Look, you've given us a lot of data. I've probably answered most of them, but your increasing exposure to labor hire. I had a few others put out results already who talked about in some cases it's difficult to get labor. They pay overs. In other cases, it's becoming more easier, not easy, but easier in terms of accessing quality labor. How have you found that across the various divisions, please, or various states perhaps?
Look, we're still maintaining like 25% margin on labor. You know, we're doing incredibly well. Perdaman, I mean, that contract, we won that at a lower rate. We purposely did that at a lower rate than we would normally take on. We found 70-odd scaffolders for something in WA that we've never had an opportunity in WA like that before. The whole strategy around developing our own training facilities is about breeding our own for this space. Last month as an example, we did about 100 different training courses through our training businesses for scaffolders in the month of July. It's not easy. No one's going to tell you it's easy, but we're not stressed about having to reduce our labor margins to attract talent.
The fact that we've got scale now, I mean, the BRAND business that we bought as an example is now going to be refining labor into Above for some of the Above contracts that they do. BRAND 's based in the Hunter Valley. Above 's got a few contracts that are sort of Central Coast based, and they will use labor from BRAND . Our ability to shift that around now with scale, it's not making it a, you know, although I'm sure if I ask the guys that run that division, it's not easy for them, but we always manage to do it.
Yep, makes sense. That was all pretty detailed. Thank you very much for taking the question.
Thank you.
Our next question comes from John Hynd with Petra Capital.
Good morning, gents. You can hear me?
Yeah. [crosstalk ]
Great, thanks. Hoping you could help us understand the guidance commentary a little better. Obviously, industrial access is going to have another strong year, and you're approaching $200 million top line there, which is a great outcome. I think more clarity around how you're seeing formwork in the, you know, just in that next 12 months. Are the higher projects still weak? Would you expect the top line to be more in line with the second half 2025 or first half 2025 when we look forward at, you know, first half 2026 and second half 2026?
For the formwork or the target business?
For formwork, please.
Yeah, I still, I think we're going to have similar results in the first half than we had in the second half of last year, probably in formwork. We're not providing specific guidance at the moment because, frankly, there's too many moving parts in that whole space. I think to be fair, we've probably got us sort of caught out by being too upfront with giving forecasts way too early, really, in the past. I think that's not necessarily a sensible thing to do. We'll provide more clarity, I'd suggest, around AGM time or at least half-year result time. Yeah, there's no doubt at the moment that the general formwork business, especially in Queensland, is at probably the lowest level that we've seen it in four to five years. That's being offset by screens and jump form growth.
We're going to go from probably a four to five-year low in that area to an all-time high within probably an 18-month period. It's not just Olympics. It's also civil infrastructure stuff with like Cross River Rail and Coomera Stage 1 finishing, Coomera Stage 2 starting around Christmas time. Bruce Highway was a big contributor. The Rocky Ring Road part of Bruce Highway kicks into the second half of next year. We'll have significant revenues off the back of that. At the moment, I think it's hard for us to predict what our formwork revenue is going to look like across the year, but we've got a high degree of confidence around industrial.
Yeah, that's great. Thanks, Steve. What about when we think about debt at the moment? Obviously, the way you've structured your balance sheet, you've got confidence in the revenue rolling through in 2027. Perhaps what I think Andrew gave guidance of 1.4x net debt to EBITDA on the call. Will that be like a run rate that you hit by the end of 2026, or will that be your reported number in FY 26, Andrew?
That's probably more run-rate. However, look, we're looking at a whole lot of things at the moment. We're actually working with Westpac closely, which is our bank. I think we're very comfortable with where we are now and where we're going to be and how we're going to get there. We're certainly not thinking about issuing any equity or something at this stage. We're comfortable with operating within our means right now.
I think we did some work just as John, just on the debt funding the acquisitions as we have, the contribution that they've made to EBITDA, the contribution they've made to EPS versus what the debt to EBITDA ratio has done. If we hadn't have done any of those acquisitions, the EBITDA for the business would be probably in the mid to high $60 million.
The EPS would be about $0.03 lower than it is, but we'd have this growth debt to EBITDA of 0.75. Right. We've chosen to debt fund this stuff because we don't think it was prudent to raise capital for that. Number one, we don't want to dilute shareholders from what we already think is a soft share cost. Secondly, we've still got a great relationship with our bank and we wanted to capitalize on that. I think we've made a purposeful decision to really significantly grow off by acquisition that division over the last two years using debt.
Yep. No, I completely understand that, Steve. That makes sense. Last question from me. With regards to the Olympic build and the various hospital contracts that are coming up in Queensland, it's obviously going to be a very, very busy couple of years there. I mean, we're sort of thinking you'll have things pick up by sort of second half of 2027, FY 27. Do you have enough inventory as you look through and get comfortable with the potential order books, or do you need to invest a little bit more in the inventory to meet the demand for these projects? How do you see that part of the cycle playing out?
It's a discussion. It's an open discussion in the business now. It's hard to predict. I mean, our gut feeling is there's going to be significant opportunities for selling products as well as for increasing our hire sleep. There's going to be a significant shortfall of both formwork and scaffold equipment. There is no doubt about that. We think we're better positioned than probably our major sort of overseas-based competitors to capitalize on that. It's why we put so much effort into supply chain and product development, you know, because we think that it's a while away yet, but there's going to be a period where getting gear quickly, access to equipment at the right price, is going to give you a real advantage when that significant uptick happens.
Yeah, remind me, what are the margins like on sale versus hire? What happens when the projects are finished? You then get to buy them back as well, don't you, the product? There's opportunity to do that.
If we want to, yeah, there's a handful of those sort of sales arrangements where there's a buyback. It's only a handful. Most of the time you sell the system to the supplier and they keep it, or to the contractor and they keep it. Margins are anywhere between 20% and 35% on new equipment, depending on the category, but it's also supply and demand. If there's a significant requirement for gear and there's not a lot of supply, you're going to get a better sales margin. It doesn't drop below 20%. You might be getting better than that. It's an open discussion. It's why Matt spends so much of his time, frankly, now in China with our Chinese manufacturing partners to make sure that when we're going to press a button and go as quickly as we can.
I'm not sure if you touched on this on the call earlier. The contracts that were delayed, I think in May or June when you announced them, can we think of them as rolling through in first half 2026 or second half 2026? Are they going to be, are they incremental to your earnings, I guess, is what I'm asking in 2026?
Yeah, we've called out about an $8 million delay. I don't think we're going to see all that in 2026.
Right. That's great.
I think, yeah, it's just a lot of that's like the hospital stuff again. It's a watch this space thing. You know, the Queensland government has got so much on its plate, right? If you look at what they're trying to do with hospitals, with infrastructure, and then the Olympics, they've got a massive amount on their plate. Just to give you an indication of that market, short term, the biggest builder in Queensland just made 250 people redundant, right? That's what they're seeing short term, right? Medium to long term, it's going to be crazy town.
Yep. Yep. I understand. Who's that? Was that Hutchies or?
Oh, I shouldn't say.
All right.
That's probably their own information, just the biggest builder in Queensland.
Thanks, Steve. Thanks, Steve. Thanks, Andrew. Well done.
Thanks, guys. Thanks, mate.
Our next question comes from [Alex Liu] with Morgan Financial.
Morning, guys. Hope you're all well. I just got a couple of questions, please. How do you start with industrial access and the revenue in industrial access towards $132 million in FY 25, and you're targeting $200 million or potentially higher in FY 26? I'm just wondering, is the $200 million what you're run rating at the moment with a 12-month, say, assuming a 12-month contribution from Above and BRAND , or are you baking in further organic growth in markets like South Australia and WA ?
It's a combination of both, Alex. If you run the tape on a full year of BRAND and Above versus two months, the $132 million goes to one sort of $170 million. If you're baking in a full 12 months of Perdaman versus seven months of Perdaman, that's probably worth another $10 million. You're up to $180 million, and then you've got to win some work.
Okay. That's helpful. Thank you. Just a question on M&A, please. You said you parked a couple of acquisitions for now, but just wondering, are you still, when you get back to looking at M&A, are you still targeting the industrial access market, I guess, in particular WA ?
Yes, as the answer, we had the opportunities that we're sort of parked at the moment in industrial were actually Queensland based. There's people we know in WA . We sort of parked all those discussions. There's another sort of adjacency area that we're quite interested in that we might revisit, not in the industrial, but it's another adjacency. We might revisit that in the next couple of years. Right today, we had another opportunity in central Queensland that we couldn't have undertaken that we've just parked for the moment because the timing wasn't right.
Okay. That's all I had. Thanks, Steve.
We'll go next to Benjamin Yun with Ord Minnett.
Oh, good day, guys. Hope you're all well. I just have a question on the industrial access opportunities in SA .
Yes, yes, yes.
If you could give us a bit of color on that market and what needs to happen. [I've been working on it.] Thanks.
Sorry, I didn't hear that.
Oh, I didn't hear that.
Okay. Hi, Ben. Can you just repeat that? Sorry, mate, we didn't hear that.
All good, all good. Just on your industrial access opportunity in SA , I'll just look a little bit of color on what you're seeing in that market and what needs to happen to capitalize on that opportunity. Thanks.
The two areas that we like in SA are defense, and we just would like it. There's some opportunities there we might be able to capitalize on off the back of the Above relationships, but that's its infancy. The other one's Olympic Dam. There's an amount of work that's going on in Olympic Dam in that area. We think we can slice a part of that for ourselves, but there's obviously other things. These are two major things that come straight to mind: Olympic Dam and then defense.
Brilliant. Just the last question on integration costs, obviously quite material in FY 25. Should we expect that to continue with Above and BRAND for FY 26, please?
Yeah, not at all, mate. There will be some because we haven't, we're in the process of integrating into the systems Above, but that's, yeah, it won't be anything like that.
Nobody needs at the same level.
Not even close. Nobody needs the same levels.
No. Great, that's it for me. Thanks, guys.
We will go next to Tina Wilson with EME Capital.
Hi, Steve, Andrew, and Matt. Just a couple of questions on industrial access. Firstly, in your contracts, do you have any protection building against cost inflation? Secondly, if you just make some comments on the competitive landscape, that'd be great. Thank you.
Thank you, Tina. Yes, all of our major industrial access contracts are complete pass-throughs. They are basically fixed margins for us. Whatever we pay the employee, there's a margin on top of that. It's passed straight through to whoever our customer is in that space. There is total protection around rate. The competitive landscape, look, for the sort of stuff that we're focusing on, we've now very much made the decision we're specializing in access. We're not trying to compete with the SRGs and [Tasmanias] and others in this world that are doing a lot of other things. All of this stuff is very much relationship-based. If they've had a good experience with you, it carries forward. Our customer in Perdaman is the same customer that we deal with in Snowy.
We wouldn't have got the Perdaman without the relationship that was formed off the back of what we do in Snowy.
Great. Thank you. Just this year coming up, do you have any significant contract renewals that's coming up this year?
Not really. We've just, in that industrial space, no. BMA's been resecured, Origin's been resecured, Visy was resecured last year. They're all now, all the key contracts have got significant tenure. We're still sort of getting our heads around BRAND . There's a couple of contracts in the BRAND business that we've acquired that I think have got probably 12- 18 months to go. We're in actually very, very good space in that area in terms of contract security.
Great. Just going to formwork for the FY 26 outlook. You kind of mentioned that there's going to be a bit of cycle in New South Wales and Victoria. Are you expecting, what, similar levels to FY 25 or actually, like, what are you thinking there?
I think New South Wales will be similar. I think Victoria will probably reduce.
Okay, great. No, that's helpful. Thank you very much.
We'll go next to Colin Ritchie with Ritchie Business Solutions.
Oh, good day. I'm a self-managed super fund investor. Just looking, I've been an investor now for several years. Just looking at the business, you've got revenues growing strongly. You've got debt growing strongly, but acquiring high return on investment assets. I guess logically what you'd expect is NPAT to be growing strongly and earnings per share growing strongly. I guess that's not what we're seeing over the last few years. If you look at NPAT 2023, it was $30.5 million, and that's grown to, what, $34.3 million in 2025. Not surprisingly, in that sort of environment, you therefore are not getting much earnings per share growth. In fact, earnings per share have actually declined slightly. Not surprisingly, following on from that, you would expect a fairly flat share price. Of course, over the last 18 months, that's what we've got.
I guess my interest is, don't get me wrong, I like what you guys are doing, but what I'd like to see is what's the focus going to be on getting that earnings per share growth sort of moving upwards, especially with the fact that there's pretty high return on investment on a lot of the new stuff that you're looking at doing.
Again, I think, Colin, thank you for the question. I don't think we can sugarcoat this. If we hadn't been investing in the growth in industrial or jump forms and screens, both NPAT and EPS would have declined in the core business. It would have declined over the last 18 months to two years. That's the reality. That's when we made a decision at least two years ago now to give us a diverse, to have a diverse expectation strategy so that we weren't a one-trick show. Those formwork results will return, absolutely will return, and will return in a very large way in the next couple of years. You'll then see the NPAT growth. You'll see the EPS growth.
I mean, other than the tax issue of two years ago that has about a $0.03 impact on the EPS from what it used to be, the reality is without the investment in industrial and jump forms and Screens, we would have seen a deterioration in earnings over the last two years.
Yeah, okay. All right. Thank you.
Thanks, Colin.
There are no further questions at this time. I'll now hand it back to Mr. Boland for closing remarks.
Thank you everybody for your participation. Thank you for the questions. Our grade is as usual. Thank you to Andrew and Matt for their input. I look forward to talking to you all again at the half year. Thank you very much.
That does conclude our conference for today. Thank you for participating. You may now disconnect.