Thank you for standing by, and welcome to the GenusPlus Group Limited H1FY 2025 results presentation. All participants are in the listen-only mode. There will be a presentation followed by a question-and-answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. David Riches, Managing Director. Please go ahead.
Thanks very much. Good afternoon, everyone. Welcome to the GenusPlus half-year presentation results. We'll just go over to the segment slide, please. One more slide. If we look at the segment group snapshot, obviously three segments. Everyone will be getting to know Genus a fair bit more these days as we've been listed for four or five years. But our infrastructure area is our founding business, industrial services, our renewable arm, and communications is our services business. We've certainly seen a good half-year from infrastructure up on revenue, an amazing half-year for industrial services, and a true turnaround for our communications business. The group's delivered AUD 333 million worth of revenue, and you can see by the revenue by state that we're still moving on our national footprint, but WA is still a strong contributor for us. TRIFR rate at 2.6.
We're only as good as our last project, and safety's at the forefront. Employees are staying steady at 1,200-odd, plus subcontractors. Obviously, resourcing is a challenge across Australia at the moment, but we're doing everything we can to continue that. Some highlights in that first half. Truly, the group has done an exceptional effort. Next page, please. We really knuckled down over the last couple of years, but we're really seeing the group now deliver what we say we're going to do. The results were very good on my behalf for everybody. We've done a Comtel acquisition, which truly is going to diversify our comms business, not just from NBN and Telstra and the likes. Comtel is a partner with some of the utility power providers and really allows us to step into the comms on the back of the renewable world as well.
We welcome Partum and Geographe Trees into the group in the latest acquisitions, two very different acquisitions. Partum to take full control of our engineering from our EPC capability across industrial services and infrastructure, and Geographe Trees, which comes with a long-standing utility relationship in cutting and pruning trees around the power lines. This has certainly been in our strategy for a long time. We did do some tree work back in 2017, 2018, where we had a crack at doing some tree work as a subcontractor, and since then, it's been in my mind to go back and circle back to all the distribution networks where we have so many people working every day while we're trimming the trees in between the poles as well. So it's very early days for this, but stay tuned and see how our long journey in the tree pruning.
Multiple landmark infrastructure projects were awarded in that six months in which we had been indicating to the market that there were several big projects out there. It's a true testament to the infrastructure pre-contracts team as they worked tirelessly on those opportunities, and now we've converted them to real-life projects. The organic growth across the areas was good too, and expanding our national footprint. HumeLink and Melbourne Renewables Hub, both HumeLink approaches, now the construction, and MREH in Melbourne is well underway and moving through its construction period. I take the time to thank our two JV partners, Acciona and Samsung, as we work through those projects together.
It's easy to lose sight and think about these big projects that Genus gets involved in, but it's fair to say that last six months we saw rapid growth from PFA, one of our main services arms, with a number of projects awarded, so it proves that we're not losing sight of services work over the projects. Next page, please. Some highlights on the numbers: AUD 333 million of revenue for the half, AUD 27.4 million of normalized EBITDA, and statutory NPAT of just under AUD 14 million shows that the business is continuing to grow. These numbers were in line with our expectation and in line to where we thought we'd be on the guidance we've given for the 12 months. Nothing seems out of the ordinary for us at this point in time.
We've obviously won a lot of work in that last six months and now got to perform the early works agreements to get them to full construction. If we look at the cash balance, obviously cash was down a little bit, but we funded some acquisitions and some CapEx, but still a very strong position for cash, and the order book has really gone gangbusters, which we'll talk about on the next slide. Next slide, please. If we look at the strong momentum. Next slide. Thank you. Strong momentum generating that part. I'm happy to take some questions on this at the right time after the meeting, but you can clearly see here that our order book has completely changed as Genus takes the next step in its construction life, and we move into a far different world than we've been in before.
I reiterate our 20% growth that we've told the market earlier this year, but the main standout here is the tender pipeline has upheld through us converting a heap of work back to order book. So a tremendous effort on pre-contracts business development to maintain that, and it really shows the depth of the current situation out there and the current future for Genus. Budgets and opportunities. These are all types of opportunities, and I think it's quite conservative look at it that there would be more than that out there, but at AUD 4 billion allows us to continue refreshing that tender pipeline and then obviously pushing it into order book as the life cycle of the project.
Without forgetting the recurring works, our recurring works continues to grow organically and through acquisition, and we will continue to offset the project work with service work and long-term contracts as the future of Genus. Next slide, please. We thought we'd put this slide in here. It certainly shows you some fantastic brands that we're working with across the country and really reiterating that fact that we're not just a project business. We don't just go after big projects. Most of the energy I don't say it like that. We put a lot of energy into everything here at Genus, but we put a lot of energy into service recurring type work. Normally, we'll try and aim for the projects to be somewhere where we can get ongoing works on long-term contracts after, and I think we continue to prove to the market that we are a two-horse race.
Next slide, please. Next slide, please. Safety, Health, and Environment, and Quality. Obviously, the back office needs to continue to build. When we first listed, we were a lot smaller than we are today. We've continued to invest in back office in supporting safety, health, environment, and quality. All of our management systems and our ISO certified. We have federal safety across the group. In that period, our LTI was nil, and the TRIFR rate in how we rate ourselves from a safety point of view shows an outstanding performance over the last years. We should really take the moment to thank the teams that worked tirelessly in the background on this.
Obviously, we want every single individual to go home the way they came to work in the morning, and starting with a streamlined safety system that actually works and gets to the blue collar and actually gives them a say in how we manage risks in the field. So I couldn't be happier at the moment on how we're rating ourselves. Next slide, please. People and Culture. Next slide, please. People and Culture. Over the past couple of months, we've now expanded our executive management team. So the board and the executive team and myself have come to a landing with Mr. Dave Fyfe, who will be joining the business as a Chief Operating Officer.
The time has come now to get some help in the executive team, and Dave brings a wide extensive experience in operation and managing of larger projects in the space we're in, and we really welcome Dave in April to start with the business and help build that bench strength for the future. Our diversity, inclusion, and RAP plans are well underway, and health and wellbeing is obviously a massive thing for us. Most of our people work away on remote sites, on rosters, away from home, and health and wellbeing, keeping everyone mentally fit and sane whilst on those sites is important. Headcount has increased by 200 odd, and we continue to grow and continue to use a wide range of tools for resourcing our projects and service work. Next slide, please. Historical performance. I'll give everyone a chance to read those charts.
But clearly, you can see our recurring work continues to grow, and we're looking very good for this year on last year. Next slide, please. Next slide, please. Record revenue of AUD 330 million for the group for the half, and that's up 33%, and record normalized EBITDA of AUD 27.4 million, up 25%, statutory NPAT AUD 13.7 million, up 51%. So we're very, very happy with the numbers at Genus, and we're certainly well on track to what we said we're going to deliver this year. Some of the normalizations is acquisition and legal costs and the ECM claims that we're finishing off on behalf of ECM and the acquisition we did, in which we're expecting they will come to a close by June or in the very near future.
So that will be the end of that acquisition for ECM and finished off the claims that were on the table when we did the acquisition. The amortization relates to Tandem and Pole Foundations, but yeah, it's a truly good result, we believe. Up 25% on normalized EBITDA, up 36% on normalized EBITDA, and up 42% on NPATA. So very happy with the results and, as I said, well on our way. Financial position, I'll hand over to Damian Wright. Take us through that.
Thanks, Dave. Yeah, just next page, please. So two and a half, completed that with close to AUD 90 million of cash, so still a strong cash position. Just want to point out that the acquisitions that happened close to the end of the half for Comtel and Partum have been provisionally accounted, so there's no P&L impact in the first half year.
So still working through what the opening positions will be on those. Strong franking account balance to enable us to continue to pay fully franked dividends. Our bank guarantee and surety bond facility increased during the half from AUD 210 million to AUD 230 million, and we've got roughly half of that available for new work as it starts to cycle through the project cycle. Our CapEx forecast for the year is expecting to be around AUD 35 million, which is mainly attributable to some rapid growth in PFA. The HumeLink CapEx that we've already discussed in previous years is still flowing through, and some additional CapEx from TasNetworks and Western Power contract that was announced in January. Next page, please. Again, just on strong cash position, generated AUD 35.5 million of free cash flow from operations, which is a conversion rate of 136%.
We've cash funded Comtel and Partum acquisitions to AUD 16 million, close to AUD 16 million during the year. CapEx for the half of AUD 16.7 million. Some of that has been cash funded due to the timing of deposits and other things before we can get the finance funded through the banking, and we expect that financing to come through in the second half, and I'll hand back to Dave to keep going on the segments from here.
Thanks, Damian. Next page, please. Next page. That's it. Thank you, so infrastructure revenue was up 22%. Infrastructure continues to grow. Margin was steady.
We've got a lot of building for the future currently in infrastructure, so we've undertaken a wide range of traineeship type incentive programs where we've brought a heap of new people in, and we've also got our visa or overseas recruitment drive underway, which is probably showing some costs in there and why the margin steadied. We're envisioning that will come back up to that sort of 10% or 11% mark in which the founding business listed out, and we've obviously had this business for a very long time, so we understand the intricacies of it, but yeah, that was not surprising, and we sort of knew that's where we would be.
But certainly good to see over the last couple of years some of the oxygen's come out of the transmission and distribution world as these bigger projects start to come on the horizon and people want to spend the money in the right areas. So certainly the work is in front of us now, as you can see from our announcements, but mainly it's very good to see a business continuing to grow through that period as well. So some of the standouts, the joint venture received notice to proceed with Transgrid, so we'll start construction in HumeLink shortly, which is a milestone. The TasNetworks project is truly amazing. If we just pause there for one second and realize what TasNetworks means for Genus. I've been here obviously all my life.
We've been working for nearly 15 years to get to this point, and I think it's a truly amazing, and not only that, there were two other projects either side of it that were announced that are truly amazing projects as well, but they got a little bit pushed down with the size of the TasNetworks opportunity. I really appreciate TasNetworks working with us over the last period to get to this point with the project, and we look forward to moving it to its next points. Awarded Ausgrid. Ausgrid was our first sort of utility client in the state of New South Wales. We did a small acquisition of Connects. I don't know if people can remember that, but a few years back, Connects was a fairly customer-funded type underground business.
We converted it to a more balanced project and utility service business now, and through that came the Ausgrid relationship, and for us to convert a new relationship doing maintenance type work into an AUD 130 million-AUD 140 million type announcement is truly an amazing effort for the GenusPlus Group, both from a project point of view and from our services, because we wouldn't get the opportunity to price those projects without doing a good job in the services, so all in all, very steady with infrastructure and ready to grow. We've been pushing the resources into infrastructure to get ready for tomorrow, and most of the CapEx is spent in infrastructure as well.
Take the point to understand that the size of these projects come, we obviously have a full fleet of gear, and we're not expecting that the AUD 100 or the circa AUD 100 million-120 million worth of transmission work we're currently doing is going to disappear to just roll over into another one. The work we're winning in those announcements will come as extra work is what our belief is, so that's why we need circa more gear. And there's always a way of us going and hiring some of the specialized equipment we were unable to hire, but hiring equipment on projects that are going to last several years or 10 years is not smart business in my world. So initially, we need to buy some CapEx to get some more gear into this business, and then it will settle back down and go through its life cycles of the projects.
We look to the future. Next page, please. If we look to the future in infrastructure, there's still a raft of projects out there. We're Rewiring the Nation 10,000 kilometers. All these things we read every day. It's all still there. I think it's more live and real now with us converting things into different stages of projects, and whether it be an opportunity through to a tender, through to an order book, through to an ECI, through to build. This is a very exciting time now for infrastructure over the next 12 months as we get ready for all of these projects to start in construction.
But it's also good to see that there's a number of substations that need to be upgraded across the grids, so that brings a whole level of work for infrastructure that's a bit easier to resource and a bit easier to manage than a big transmission line from a—we've got to build a transmission line 200 kilometers through hills and stuff, substations all in one footprint. So there's a raft of projects we're seeing, but we are also seeing an increase in the distribution component, which is obviously the oldest part of infrastructure and a real exciting part because obviously that comes with a very old history and a very old workforce who can deliver. And we're seeing a raft of distribution opportunities alongside our transmission and substation opportunities now. Next slide. Next slide, please. Industrial services. This has been an amazing journey.
If we take ourselves back three or four years ago, we bought ECM out of administration as an electrical E&I contractor. We are still doing E&I work, so we haven't completely changed it, but we certainly got into some new markets, and this speaks for itself at AUD 93 million worth of revenue. We paid, I think, about AUD 1.7 million for ECM out of administration some years back, so real true value here and a real standout to Kevin Arnold, our EGM, and his team. They've done an amazing job as we work through the 200 megawatt battery in KBESS. We also work through a large 275 substation in Queensland. We've got a JV happening with Samsung and a raft of opportunities that we see going forward with industrial services.
Obviously, the bench strength coming in with our new COO, Dave Fyfe, who's had a lot of experience in this side. But AUD 93 million of revenue, EBIT of AUD 5.5 million in line with the way we're tendering work. And I think we've had a number of discussions over the last couple of years that we thought this business would be that 5% or 6% EBIT is where we wanted to get to and certainly hit that mark in that six months. Next slide, please. From a strategy point of view. Next slide, please. Yep. So from a strategy point of view, obviously, we started as E&I and put that business back into the business that we've sort of done over a long, long period of time, but moved into the best projects.
We've now done a couple of large solar projects in which the last one went very well for us and now starting to also look at wind opportunities and pretty much anything in that energy remit and the renewable market. So we're really widening out the industrial services renewable feeling now. While we're still doing some great small services work in the background, which continues to deliver good margins, I think we still need to stay tuned to industrial services. Obviously, there's a long way to go. On that page there, you can see a number of opportunities in BESS, which is across the country. And we need to use our experience from being some of the first contractors to do grid-scale batteries. We need to now leverage that experience, our teams, leverage our national footprint, and make sure we win a number of these projects. Next slide, please.
And now to our communication segment. So a lot of talk about this over the last couple of years, and people sort of thought, "What are we doing here? And where are we going?" But Damian and I always understood we had a plan for this business, and I think Stuart, our EGM of Comms, and his team have really put that on the page this time too. We sort of gave some indication. We thought the business was turning its circle. Sometime in the last quarter of last financial year, we still had some right sizing to do and came into the financial year this year with a fresh lease of life, and we've certainly delivered that. This is obviously a lot of work for NBN and Telstra, which are fantastic clients, and we continue to want to work for them for the rest of Genus's life.
But we had to right size and calm the business down, get it to a point where it's profitable, and we certainly have done that. Now, it may have taken us a little bit longer than first thought when we took over Tandem and rolled it into our Diamonds business that we had doing communication work, but that integration is fully done now, and people are happy and moving forward with the work. So we couldn't be happier with this now. And then out of sort of surprise, the Comtel comes up and runs itself into a little bit of trouble financially, and we've now worked with the Comtel owners to bring it out of administration and sit alongside our Comms business, which is more oriented around power and rail and mining, etc., and alongside our Telstra and NBN customers.
So we certainly have got a diversified Comms business between this offering and the Comtel offering, and we're really excited about now seeing how we scale this business and work to the future. Next slide, please. The communication market. Next slide, please. The communication market is a beast of a market, as you can see by the chart there. But let's not get ahead of ourselves. We are where we are tonight in our Comms business, and we're going to continue to grow it as we see fit. But I think just talking back to that Comtel acquisition and diversifying that customer base and putting two very, very strong Comms pieces together is truly an amazing thing through that six months that offer that we got. And GenusPlus now offers mission-critical infrastructure for Tier 1 customers through power, utilities, mining, oil and gas, transport, and defense.
So we're well underway here. Comtel had a circa sort of AUD 70 million run rate. Our business is circa 90, 100 million off that last slide. So we've really got quite a sizable Comms business now that we can work together to how we scale into the future. Next slide, please. That wraps up the presentation for today, and happy to move to questions. Thank you.
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. Your first question comes from Gavin Allen from Euroz Hartleys. Please go ahead.
Hi, I'm Gavin. Good afternoon. Thanks for that. Just a couple for me quickly.
So maybe you've got a slide there called on the FY25 outlook, and you quite rightly point out a very large increase in your order book from AUD 519 at the end of 2024 through to sort of near enough to AUD 1.5 billion now. Could you maybe just give us a little bit of flavor on just to put everything together on where it is that you've added your order book? I mean, I'm sure all of us have got a sense of it, but just for clarity.
Yep. Yeah. Thanks, Gav. Slide six, if we can go back to slide six, would be helpful. Yeah. So mostly it's balanced.
If we pull out a couple of the big opportunities, Gav, which is Hunter and Tasmania, the rest of it would be typically on a sort of 70% infrastructure, 30% industrial services, sometimes 25%-75% we see between those businesses going on their size as well. It sort of works sort of in line with those, but yeah, it's certainly a big improvement from the 519. We still, some of them we're working through, for Hunter and Tasmania, we're working through ECIs with our customer, and we'll get to the final number, so we've just put in there the estimates of those numbers for the moment, but I don't think they'll be far away from where they stand.
So I suppose now Genus has taken a next step that it's not about we once upon a time would win an AUD 8 million job, and then you're down, you sign the contract, and you're off and racing. Now there's a life cycle to these projects through the early works, and that's what I've been trying to sort of get to is to get on that round robin so that they start rolling through. But it's exactly the way we've sort of set it over the last couple of years. We've got our organic transmission business, which does AUD 10, 20, 30, 50 million-dollar type pieces of work, which we've been doing for many years. We then see an influx in major, major projects from the JV point of view, and we'll choose to JV when it suits and obviously around the risk thresholds and things.
And then there's a number of projects that sit in the middle being Hunter, Tasmania, Western Power, which are major projects that we haven't seen before in infrastructure, and that's the step change for Genus. So most of it would be coming from infrastructure this year. I think last year it probably would have been industrial services would have come out of the blocks and started to win some big batteries, which were materially changing that business, but now we're swinging back around to seeing that Rewiring the Nation here and now.
Yeah. That makes sense. And you touched on it just talking about infrastructure. You touched on margin briefly during the call and a target, an objective to head back to sort of 10%-11%.
Is that something we can sort of think of into 2026 or longer than that, or how do I kind of think about that journey?
Yeah. I'd like to say we're just finalizing those CapEx expenditures now, which you'll look at either way. You can probably work off that 10 or 11. We've owned this business for a long time, Gav, so we know. I think last year I did tell I did think margin was quite hot last year. I think we're running at about 11.6%-11.8% last year, which was a touch hot for that business. I think we settled back down. I can see that business has swallowed some costs in around this resourcing that we're doing, and we don't have the time to go into the detail today.
But certainly, we launched a year ago and go, and whoever's got the people's probably going to get the best chance at the work. So we launched, and we've chosen to invest in the industry. I'm not sure what our peers are doing, but we've launched. It's probably 0.5%-1% of margin at the moment, but we'll get that back when the volume of work starts to come through, and we can push these resources onto several jobs, not three, if that makes sense.
Yeah. No, it does. Just one last one for me, which is really big picture, and just whether there's any rules of thumb you can sort of help us out with in terms of construction cost per kV of transmission, for instance, as we look to 10,000 kV of transmission over a long period of time.
Yeah.
I've been asked this question a couple of times. They are all a little bit different, but when we look at a HumeLink, which is a massive feeder that's coming out of Snowy Hydro up into Sydney region, that's a 500 kV line and 225 kilometers of line for us and one substation, AUD 1.4 billion. So I think that's around AUD 5 million or AUD 6 million a kilometer for that really top end of town. Down to we may see some mining type solutions that are a lot smaller power line. It's not some it is smaller in height, smaller in size. They might be AUD 1 million a kilometer, and then down into distribution from there, which is your street stuff, which changes again.
But if we just look at the transmission, the stuff that you're seeing in the media is probably not commenting too much about hooking up one gold mine in the middle of nowhere. So a lot of the stuff you're seeing is that bigger stuff, which is sort of 275 or 330 kV or 500, which generates multiple wires per phase, and it generates a large project. I do think we'll see the utilities release some like HumeLink, which is a massive job, and I think we'll see some smaller bite-sized pieces as they look to sort of rejig the network as well as build some of these massive feeders.
That allows a real opportunity for our more business-as-usual type work that we've run for many years to jump into action there on maybe a AUD 1 million or AUD 200 million dollar job and really run that a bit old school compared to what happened to go into a HumeLink that's got just so much that we have to get done. Horses for courses, Gav, but anywhere between AUD 1 million and AUD 5 million a kilometer.
Beautiful. Makes sense. That's plenty for me, guys. Thanks very much.
Thank you. The next question is from Matthew Chen from Moellis. Please go ahead.
Hi, David. Hi, Damian. Just wanted to ask you, Comms business was a good result. Have you got the business to where you want it now?
This is the rate we should be kind of expecting going forward, or how are you thinking about the next kind of 12 months for that one? Thanks.
Thanks, Matt. I knew that question would come, so I was well prepared for that one. Less than 7%, I think it's 7.5%, but it's a fantastic result. We're really wrapped. We let it run its course, and it's well managed and well played. I think depending on scalability is how I'd answer this question. So there's obviously some other listed players that are very heavily involved in this space, so there's plenty of information out there for people to have a bit of a look at. But we sort of said 5%-7% for this business, five being percent EBIT, being more on the scale side, and 5%-7% is what we were trying to get it back.
So we've hit the top numbers of that. And is there more to go? We'll certainly have a look at that. But the real focus on now is how do we scale? How do we build a beautiful Comms services business, repeatable long type contracts to really offset our projects? And we don't mean offset. It's just well balanced is what we want to be. So I suppose we need to take into consideration how we scale that business and what's an acceptable margin based upon that revenue. But the one thing I think we all can agree on is it's meaningful, and it's now adding value.
Thanks, David. Appreciate your time and comments.
Thank you. There are no further questions at this time. I'll now hand back to Mr. Riches for closing remarks.
Thanks very much for listening today, everyone.
Happy to take meetings and that if we need them after that or contact Damian and I. But yeah, appreciate everyone's time today. Appreciate putting the half year in front of everyone. Obviously, we've got a lot to do here at Genus, so we'll get back to our daily jobs. Thanks very much, everyone.
Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.