Good morning, everyone, and welcome to Mader Group's full-year results presentation for FY 2025. Also, today with me is our Chief Financial Officer, Paul Hegarty. To get started, I'm proud to announce that we have exceeded our revenue and impact guidance targets of $870 million and $57 million, respectively, having successfully navigated several unexpected headwinds throughout the financial year. With record annual results of $872.2 million in revenue and $57.1 million in impact, this achievement marks a significant milestone for our business as we enter the final year of our five-year strategic plan. We do so with growth momentum and encouraging market conditions. This year marks 20 years of operation for Mader, a milestone that speaks to the hard work, grit, and determination of our people. These qualities were on display throughout our global operations in FY 2025.
Our team's commitment to getting the job done wherever and whenever it's needed is what drives our success. I'd like to extend my sincere thanks to our entire team. With all that said, let's jump into it. For those who are unfamiliar with our story, Mader was founded back in 2005 by our Executive Chairman, Luke Mader. Identifying an underserviced niche in the industry, Luke started providing flexible maintenance solutions to our customers with no more than a ute or a truck for our North American investors, some tools, and a vision. Twenty years on, that vision has certainly come to life. Today, Mader is a truly global business, delivering technical services across multiple industries in nine countries. Backed by a team of close to 4,000 technicians with diverse skill sets, we proudly supported over 490 customers in more than 640 locations across the globe in FY 2025.
As you can see, over the past 20 years of operation, we have successfully evolved into a truly global, diversified business, with our unique business model replicated across multiple industries across the globe. By launching fully organic startups in new markets, expanding geographically, and broadening our suite of trades, we have been able to achieve an average compound annual growth rate of around 30% over the last 10 years. This growth is significant and, importantly, all organically derived. Our ability to tackle new markets and geographies successfully is a testament to the unique business model that Luke established back in 2005. We also acknowledge that none of this would have been remotely possible without our passionate and hardworking team, which leads me to our next slide, our specialized workforce.
Touching briefly back on Luke's vision, he had a dream to build a workforce where people not only had pride in what they do, but they got to get the job done working alongside their best mates. That camaraderie echoes loudly to this day, and we're proud to lead the market when it comes to investing in our people and our culture. As you can see, 66% of our workforce are under the age of 35. While we're an equal opportunity employer that provides options for those at any stage of life, our adventurous career pathways typically attract a demographic that is looking for more than just a job. From tailored rosters, site variety, wide equipment exposure, international secondments, and more, we invest heavily in our people to provide opportunities that are unparalleled across the industries in which we operate.
At the core of this are our two culture-led programs: Global Pathways and Three Years, which have both been continuously refined to provide the best employee experience possible. We'll touch a little bit more on these later. Last but not least, our commitment to safety remains at the center of everything we do. With a trigger of 3.71 recordable injuries per million hours worked at June 2025, we acknowledge that safety is a continuous journey, and the work here is never done. Ongoing education, innovation, and investment in our geared-for-safety programs and culture are key to driving further improvement. Coupled with our investment in technology-based tools, Mader remains at the leading edge of safety across the industries in which we operate. Before heading to the financial review, I'd like to provide a quick snapshot of our FY 2025 highlights.
We delivered yet another record annual revenue of $872.2 million, an increase of 13% on the prior corresponding period. This was coupled with a solid net earnings of $57.1 million, up 13% on the PCP. Further, our balance sheet was strengthened, with net debt down an impressive 73% to finish the financial year at $8.3 million. Amongst current competitive conditions and a decent diverse talent pool throughout Western Australia, particularly in the first half, we continue to deploy our multidimensional recruitment and retention programs to deliver net headcount growth of circa 600 throughout the year. Demand remains strong across most regions, with our core mechanical and other industry verticals consistently meeting our customers' demands. Pleasingly, North America returned to growth in the second half, expanding its revenue base by 8% half on half.
Positive customer sentiment and new customer acquisitions are continuing, and we remain extremely optimistic around what the future holds throughout the U.S. and Canada. We're more focused than ever to achieve our five-year strategic plan, which I'll touch a little later on. Flicking over to slide five, we'll drill down into each segment's highlights for the financial year. In Australia, revenue increased by 17% versus the PCP, delivering $686.2 million. Our core mechanical services remain strong nationally, growing by 14% despite a softer customer demand profile, particularly in the first half. Importantly, that customer demand profile has corrected and is now on an upward trajectory with very strong momentum. In addition to this, our key growth platforms continue to perform.
Our infrastructure maintenance division increased its revenue profile by 30% versus the PCP, and our road transport team, while still small, expanded their revenue profile by an impressive 64% versus the PCP. In North America, revenue increased by 8% on a half-on-half basis. This is a really important data point as this segment returned to growth in both revenue and headcount in the second half. Operating in 25 states across the U.S. and eight provinces and territories in Canada, we significantly broadened our reach during the financial year. New customer acquisition remains at the heart of our growth strategy, with the number of active customers in this segment increasing by circa 20% versus the PCP. Jumping over to our rest of the world operations, we provided specialist services and technical support for customers in nine countries across Asia, Africa, and Oceania.
This segment has returned to pre-pandemic activity levels with positive growth opportunities ahead. While it's still a small portion of our revenue base, it remains a strategically important career pathway for some of our most talented technicians. I'll now pass you over to our CFO, Paul Hegarty, to run through the financials in some more detail. Over to you, Paul.
Thanks, Justin. Thanks to everyone who has taken the time to join us on the call this morning in what is a very busy results week. I'll be going over the full-year financial performance for the group. Justin has pretty much stolen my thunder on most of these points, but there is some additional color I'd like to add. As mentioned, we delivered $872.2 million in revenue, an increase of 13% versus the PCP. Importantly, this revenue growth has been delivered with a consistent margin profile year after year. In fact, at the four-year mark of our five-year strategic plan, having expanded the business's revenue profile by an average of 30% over the last four years, our impact margins have remained steady, varying by not more than 60 basis points from the highest to the lowest financial year.
Whilst this stability is impressive, it gets more exciting when you consider our North American segment returning to growth, up 8% half on half. With North American EBITDA margins close to double that of our Australian segment, as this business continues to scale, it represents real margin leverage for the future earnings profile of the group. From a shareholder perspective, EPS increased to $0.2835 per share, an increase of 12% versus the PCP. Total dividends relating to FY 2025 were paid or declared, totaling $0.088 per share, fully franked, of course. This represents an impact payout ratio of 31%, in line with the PCP. Now moving on to our financial position on slide seven. As you can see, our asset base primarily comprises cash on hand, trade receivables, and PPE. We don't have contract positions or any intangibles to be concerned about.
Therefore, we think we have a relatively simple balance sheet. Property, plant, and equipment increased over the year as we invested in growth. We added around 450 service vehicles to our fleet, taking our global fleet to over 850 service vehicles deployed across multiple continents. Our trade receivables position is largely with tier-one principals and large mining contractors. Due to this, we don't generally need to manage poor credit risk profiles in the data book. Pleasingly, average DSO for FY 2025 came in at 69 days, an 8% improvement versus the PCP. This improvement in collection activity, coupled with an increase in free cash flow, which I'll talk a little bit more about on the next slide, enabled the group to report a net debt reduction of 73% versus the PCP, closing out FY 2025 with net debt of just $8.3 million.
With forecast CAPEX in FY 2026 expected to be in the range of $35 million- $40 million, we expect the business to transition into a net cash position during FY 2026. This reduced leverage will allow greater flexibility and freedom to make strategic decisions around future growth. We remain well supported by our lenders, in particular by our primary lender, NAB, here in Australia. In addition to this, we have strong working relationships established across all regions in which we operate, in particular with UMB in the U.S. and JPMorgan in Canada. The flexibility that has been established within our finance facilities will allow us to respond quickly as opportunities present themselves. Now on to every CFO's favorite slide, the cash flow. Our net cash flow from operations was $76.8 million, an increase of 12% versus PCP. Our intense focus on EBITDA conversion was maintained throughout FY 2025.
Operating cash flows before interest and tax, as compared to EBITDA, was 101%. This reflects the quality of our client base and trade receivables ledger, as I mentioned earlier. Now, this next data point is perhaps my favorite for FY 2025. Free cash flow generated during the year was $42.7 million, a 52% increase versus the PCP. This is the second full financial year in which Mader has generated positive free cash flow, or fifth consecutive half-year period. As the group continues to scale its revenue profile into non-vehicle-based services, the Mader business model is transitioning into an even more CapEx-light setting. This means we can continue to grow top-line revenue without purchasing a service vehicle for every new employee. The result of this is twofold. The business can pay down its debt facilities, reducing our interest burden, which in turn leads to improved net margins.
Perhaps more importantly, it positions the group in such a way that we can build a war chest to tackle new growth opportunities in the future. As I mentioned on the previous slide, this will allow greater flexibility and freedom to make tactical decisions around future growth. Now everyone can wake back up as I hand it back to Justin to talk about the strategic plan.
I love it when you get excited, Paul. Right, you know, let's move on to the next slide, our strategic plan. Four years ago, the board laid the foundation for our future by setting out some key areas of focus in our first strategic plan as a publicly listed business. Since then, it has served as a blueprint to guide our growth. The strategic plan set out growth targets and operational goals in four key areas: geographical diversification, service line diversification, expansion of industry verticals, and of course, to continue scaling the existing business. Further, impact targets were set, as you can see detailed on the slide. With that said, we identified the need to establish a series of core building blocks to create a solid foundation for future growth. This leads us into slides 10 and 11, our building blocks.
Over the years, we built a strong foundation for growth and one that goes beyond just financial metrics. At the heart of it all is our culture, which remains the driving force behind everything we do. Programs like Global Pathways and Three Years bring this to life, offering our people incredible opportunities to travel the world while working, then spend their R&R with our internal adventure division, Three Years. This kind of experience is currently unmatched anywhere in the industries we work. We've worked diligently to expand both programs, so opportunities are bigger and better than ever before. This has seen more than 380 employees take on both short and long-term overseas secondments, as well as an extensive array of adventures to learn. Culture is just one piece of this puzzle. Another key driver of our growth is how we apply our proven business model across different industries.
By expanding into new markets, we're creating a compounding effect, diversifying revenue streams while tapping into large addressable markets, for example, in resources and infrastructure maintenance. The best part about it is we're only just getting started. Moving over to slide 11, we see two more large addressable markets: energy and transport logistics. In the energy market, we initially focused on delivering maintenance in the natural gas compressor stations in the United States. However, this industry represents a large untapped potential for future global growth. In the transport and logistics industry, we've expanded our efforts to provide maintenance for rail and road transport maintenance, now operating across most of Australia. Given the critical role of transport and logistics in Australia's resources industry, there is significant growth potential that aligns well with our existing operations. Finally, a building block that is key to future growth involves deliberate entry into emerging markets.
As always, we'll conduct thorough market research into new industries and assess the suitability for the Mader business model to be deployed. We have a proven track record of organically replicating our business model across multiple industry verticals. Exploring opportunities outside of our core services will allow us to capitalize by extending across further industries and geographies. This is effectively creating more opportunities for our people and diversifying revenue streams for sustainable growth. In addition to enhancing our service offerings, geographical expansion remains central to our growth strategy. We have multiple geographical beachheads and are always looking to enter new locations and diversify our exposure. The Australian business continues to generate the largest portion of revenue for the group at 79%. We are confident in the stability of this segment and know we'll continue to deliver strong results in this area.
Pleasingly, our North American segment returned to a growth setting, increasing revenue and headcount in the second half of FY 2025. Today, it represents 19% of group revenue, with significant runway ahead in this region. Established in 2018, this segment has expanded significantly over time. With this solid foundation laid, the outlook is positive for the mid to long term. Our rest of the world segment contributed 2% to revenue across the business. While this is still a modest number, the annualized revenue exit rate for the rest of the world is now at pre-COVID levels. As a business, we continually seek to improve the diversity of our revenue profile. This is a pivotal step towards achieving our FY 2026 guidance of $1 billion in revenue. Throughout the strategic enhancement of our service offerings, we can tap into new markets that allow us to expand the group's revenue streams.
We are constantly scoping addressable markets where we can apply our culture-led business model. This is key to driving future growth and ensuring long-term sustainability of our business. Our diversified operations will continue creating compounding returns for our shareholders with strong growth rates into FY 2026 and beyond. If you cast your mind back to slide nine, where we first touched on our strategic plan, this slide here shows our progress against those impact targets set. As you can see, for the first four years of our strategic plan, we have not only achieved but exceeded our impact targets. We're pleased with the FY 2025 result, all things considered. Now we have set our sights on closing out FY 2026 in line with the strategic plan set four years ago by the board.
With low capital intensity, a unique culture-led business model, and opportunities identified to accelerate growth, Mader has the confidence to set FY 2026 guidance to at least $1 billion in revenue, an impact of at least $65 million. We have delivered a 10-year compound annual growth rate of circa 30%. As the business continues to mature, we are excited to continue to deliver the compounding effect of the Mader business model to existing and new markets. In doing so, not only will we deliver continued growth into FY 2026, but we'll continue to build a solid foundation for future growth well beyond that. With the FY 2025 wrapped up, I'm filled with nothing but confidence as we enter a new financial year. For current and prospective investors, Mader represents a very robust investment opportunity with many exciting prospects ahead.
Backed by a nimble, adaptable business model, we have grown to have a market cap of close to $1.7 billion delivered over the last 20 years on an entirely organic growth platform. These consistent results should also see us considered for the ASX 300 in the near term. The resilience and hard work of our team shines through in many areas. With them behind us, we'll continue to deliver a superior service for our customers and value to our shareholders. That concludes our presentation today. I'd like to thank everybody for joining us, as Paul said, in such a busy results period. We'd be pleased to take some questions at this time.
Thank you. If you wish to ask a question, please type it in the Ask a Question box in the bottom right-hand corner of your screen. Please proceed, sir.
Thanks, Rocket.
OK, into questions. Jonathon Higgins from Unified Capital Partners, over to you for this one, Justin. North America, well played, back to growth. Can you give us an idea of the interplay of the recovery, V-shaped as we've spoken about previously? Noting headcount at a record, must be some better utilization to come also.
Yeah, thanks, Jono. Yeah, look, it's been certainly a pretty exciting time in North America the last little while. I guess, you know, getting that election behind us, I think the whole market has really settled and everyone's sort of head down and back to business, which has been a great thing for us. As we've spoken about in previous results periods, the business development efforts targeting some of those key markets are really starting to come to fruition now. We're seeing that growth happen. We're seeing a really exciting, particularly gold and copper over there. You know, starting to see that business development really, really come alive. Looking forward to a big FY 2026 and beyond. Canada as well, continuing to expand into new regions and new areas. Remembering we're only three years old in that space, it's a pretty exciting growth profile moving forward for that region as well.
Thanks, Jan. Another one from Jono at Unified. Australian verticals continuing to grow, big business. How should we think about growth moving forwards?
Yeah, good question. Thanks, Jono. Yeah, appreciate your questions there. Look, the verticals, you know, we've been talking about the verticals for quite some time now. I guess the exciting news about that is those things are starting to become of substantial size and really tipping in to move the needle on the group numbers. You know, things like infrastructure, we've set up both sides of the country in Australia to really take advantage of those opportunities. Essentially, the same customer base is what we deal with in the mobile space. Yeah, we see that as a huge growth platform. Infrastructure on its own could be somewhere near the size of the core business in Australia. When you think about that, it's a really exciting sort of runway ahead of us. We feel like we've got some really strong teams in place to deliver those results.
Road transport's another one, still far smaller. You know, again, we're pretty excited about the results we've seen so far. We know it's a huge industry. We know our business model can really relate and reflect on it. Yeah, good things to come.
Thanks, Justin. A question here from Anish Trivedi online. Will the rest of the world region be a focus in the next five-year plan, or will the focus continue to be North America?
Oh, look, the focus will definitely be both, you know, to be able to scale that as we did last year. It sort of went up about 80% in FY 2025. We still look for great opportunities. You know, tier-one clients in safe regions is where we want our people to be working. It's still, you know, as I said in the call there, it really remains a strategic focus for some of our really talented tradespeople that want to go and work in those areas and support local workforces. Definitely a focus for us, you know, as is North America. We see that as a huge growth platform, and you know, we'll continue to put the horsepower into growing that.
Thanks, Justin. A question here from Gavin Allen from Euroz Hartleys. How might we think of the next five years? Are you in the midst of generating a new strategic plan by any chance? I can say that question's been asked about three different ways by about five different people. Justin, the next five-year plan?
Yeah, thanks, Gavin. Good morning. Most definitely, we're well and truly in the midst of creating that next five-year plan. Not to be disclosed just yet, but yeah, putting some finishing touches on that. Needless to say, we're pretty excited about releasing that and delivering that in due course.
Good stuff. Thanks, Justin. A question here from John Ferguson from the Australian Shareholders Association. Good morning, John. Given our global operations, how are you managing currency fluctuations? The first question there, Jonathan, relates to currency FX. The way that we manage that is we create a natural hedge in country. Our operations are funded through working capital, which are established in the local currency, so Canadian dollars in Canada, U.S. dollars in the U.S. The revenue from those operations pays down the leverage in each corresponding region. It creates a natural hedge. Another one here from Joey House from Bell Potter. Good morning, Joe. Provide some color on the rest of the world margins in the second half. How has that played out? What are we thinking for the rest of the world in FY 2026? I'll take that one, Joe.
Essentially, we started a new contract in the late first half of FY 2025, which meant that contract was in full force for the second half. It's a contract of scale with a tier-one principal in Africa. It's good work for our people, and that's what's driving that margin expansion. Into FY 2026, we expect that contract to continue, so those margins are expected to hold at around those levels. A question from Matt Joass from Maven Funds. Free cash flow growth was huge. Tell me about it, Matt. Can you talk more about what the main drivers were? There are two key factors there, Matt. As I talked about, the business is transitioning to an even more CapEx-light setting. Some of our new verticals, like infrastructure maintenance, road transport maintenance, rail services, etc., these are service lines that are almost CapEx free.
Other than some tooling containers and some light vehicles, there's not a one-to-one ratio of new employees to service vehicles. We're getting top-line revenue growth without having to invest in the capital. That's the main contributor to where free cash flow landed for the full year, which we're pretty happy about. Obviously, as we scale those new verticals in FY 2026, we're expecting that to continue. A question from Steven Mabb from the Australian Shareholders Association. Thanks, guys, and well done on another good year. Just read your comment about potential ASX 300 inclusion. What are we thinking about that? How do we get to the 300, Justin?
Steven, how are you, mate? Good to see you online. Certainly, as our market cap's growing, free float is there or thereabouts. We continue to grow into FY 2026. I think those numbers will take care of themselves over time. Certainly seems that we are close to consideration. Obviously, not a massive focus for running the business. We'll just continue delivering the numbers. That'll happen in due course.
Thanks, Justin. A question from Melinda White from Longwave Capital. To win work in Australia, infrastructure or road transport, who are you typically winning work from? What differentiates your offering versus competitors?
Yeah, thanks, Melinda. Appreciate your question there. Look, infrastructure and road transport initially are really off the back of the customers that we're doing the mobile equipment work for. Most companies that are running sort of large mining equipment are also running some sort of process plant, and many of them are also running road transport-style trucks for long haul of ore, whether it be to plants or to port facilities. Definitely leveraging the vendor numbers and customer base that we have. Also, as we build that capability, we can also start to roll that out to others within the transport and logistics industry, as we have done in the rail space.
Thanks, Justin. A question from Matt Chen from [Marlis]. Good morning, Matt. Thanks for joining the call. Any parameters we can talk about about inorganic opportunities moving forward, Justin?
Oh, look, Matt, as always, they're certainly on the radar. We take everything that comes across our desk into consideration. Certainly sort of sitting on the verge of net cash, that probably becomes more of a reality as we go forward. As we said before, we're still formulating or finalizing that next five-year plan. That is certainly a consideration there as well.
Thanks, Justin. A question from Frank Volante online. Good morning, Frank. Thanks for joining the call. Can we comment on what losses in FY 2025 were generated on acorns or startup initiatives? I'll take that one, Justin. It wasn't too much. Frank was fairly consistent with FY 2024, circa $1.5 million- $2 million for acorn investments here, as you say. Another one from Frank around North America. Maybe talk to the splits in Canada and USA more broadly because there's a couple of questions, one from Frank on that, as well as another one from Tony Shields. Good morning, Tony. Around, I guess, customer numbers, staff numbers, and location. Staff numbers increased by 21%. Locations up from 540 at December 2024 to 640 now. Maybe just some color on that, Justin, around the USA and Canada.
Yeah, no problem. I guess as far as headcount numbers in the North American region, I think we're sitting circa we'd be close to sort of 400 odd in Canada now, probably 350, 370 at the end of the financial and the remainder in the USA. We'll be our splits there, you know, coming close to 100 odd for the rest of the world.
Thanks. That's good. A question from Joey House from Bell Potter. How is the sales cycle going in the U.S.A. now compared to the first half, perhaps? Is it shorter and easier to win new work?
Yeah, thanks, Joe. I wouldn't say it's ever shorter or easier to win work in the U.S., but certainly, I think we're reaping the rewards of a really heavy BD cycle that we were doing through that whole election period. Turning that into tangible work was pretty difficult at the time. I think once that election happened and the market sort of freed up and everyone sort of knew what was happening business-wise, we've really seen it return back to a business as usual there in the U.S. would probably be the easiest way to put it.
Good stuff. Another question from Anish Trivedi online. As we expand in the U.S. and into other modalities like rail and road transport, will we see gross margin strengthen over the next few years, or will it be more of the same?
Yeah, I guess we're very early days into other industries in the U.S. and Canada. We still see some huge growth opportunity that we're putting all of our focus on at the moment. Look, we would expect so. We've seen that typically in the markets that we do work. We would be looking for similar markets or similar returns on sort of, you know, new business ventures over there, for sure.
Good stuff. Question from Indy from Bell Potter. Two-part question. I'll take the first one. You can take the second one. We talked about current capital intensity of the business. CapEx FY 2026, we're guiding $35 million- $40 million, Indy. The second question here is around capital management. With the balance sheet returning to net cash in 2026, Justin, will we be exploring inorganic growth or looking at increasing payout ratios?
Yeah, thanks, Indy. Certainly with the balance sheet returning to that net or getting to net cash, I guess it gives us a lot of opportunity to explore both, Indy, to be honest. We will do both. We're definitely looking at some inorganic growth opportunities. You know, we always have. We're just not very good at actually executing. We sort of typically get back to that organic model because it's sort of what we do well. No, it's definitely something that we'll be considering going forward. Increased payout opportunities, I guess that's probably more of a broad question at the time.
Good stuff. A question here from Simon Crichton online. Well done on improving your receivable management. I'm curious as to how far you can take this or to the standard payment terms you offer your clients. I'll take that one, Justin. I guess, Simon, it's sort of a 30- 60 days is typical end of month. So DSO sitting at 69 days is pretty much where I think we'll land. We might be able to squeeze that three or four more days lower. Where we sit today is pretty optimal, to be honest. A question here from, where is it, Joey House from Bell Potter. Maybe some general commentary, Justin, around the various service lines, excluding heavy mobile equipment, and how they're contributing to the Australian segment. Are these service lines at critical mass and contributing meaningfully compared to, I guess, the core business?
Yeah, good question, Joe. I don't have the exact percentage numbers there in front of us. Certainly with our electrical divisions, and particularly with, I suppose, the focus from mining and other companies on electrification of things, on green energy and the like, we see that as a huge continued runway ahead of us. Welding and fabrication, light voltage or low voltage electrical, and then as well as things like the heavy road transport, rail, and the like, they have all got massive runways ahead. That would be + 20% of our revenue, for sure. I'll double-check that number and get you a more accurate one. Yes, they are definitely tipping in in a meaningful way. We see those with huge runways ahead.
That's fun. A couple of questions here from Melinda White from Longwave. As you expand into new verticals, is the nature of the type of skills in your workforce changing?
Yeah, good question, Melinda. It probably just gets back to that last comment around sort of electrification of many things, like companies going to battery-operated mobile equipment, renewables on site, and all the rest of it. Certainly, that electrical scope of work has been continuing to grow. It definitely doesn't change the need for the heavy-duty diesel mechanics. I mean, that is, you know, things with tires and wear parts and suspension and, you know, final drives, all that sort of stuff is still very, very relevant. It's probably just an additional upskilling of those trades and a bigger opportunity for the electrical trades as we move into the sort of new world, I guess.
Good stuff. A follow-up question to that. How difficult is it to recruit skilled technicians? Maybe talk to that between Australia and North America.
Yeah, I don't think that's really changed too much over the years. I mean, it's always been, you know, a bunch of trades that are typically very hard to get hold of. I don't think there's anywhere in our business that we're not recruitment constrained. That is the way we like it. Our opportunity is to create those great opportunities for employees. As we spoke about with our Global Pathways and our Three Years, we pay our people very well. We look after our people. We give them huge opportunities. It's probably really accentuating that point of difference that our business has to attract employees to come and work with us.
Another question, a follow-up question on that. How do we see wage inflation that we're facing versus prices you can charge to the end customer for work? I'll take that one. Look, wage inflation has been steady, Melinda, for the last five to ten years, to be honest with you. It's sat in that sort of 3%- 5% range. Over the last 12 months, we've seen that moderate slightly in Australia and be consistent in North America. In terms of how we pass that on to our customer, we've been able to secure price increases at least in line with inflation over the last two or three years, in particular, where we have seen wage inflation at that sort of 3%- 5% range. We're keeping up, I guess, with how wage inflation is coming through to us.
I guess that's confirmed by the margin of stability that I talked about earlier. A question here online from Tony Shields. I'm looking for a bit more detail on the increase in staff. Total staff increased over the year by 21% and revenue increased by 13%. What's the difference there? Tony, it really comes back to the ramp in headcount growth. First half was a little bit softer from a demand perspective, particularly in Australia. We saw that return in the second half. A lot of the headcount growth comes through in the second half, but you only get, you know, six or less than six months' worth of revenue out of that headcount. That's the difference there between revenue growth and headcount growth. That's where that headcount growth landed in the cycle. Another question from Indy from Bell Potter.
The verticals you mentioned, they are currently offered in Australia, right? Is it something that you can take to services outside Australia as well in due course?
Yeah, no, good question, Indy. Yes, it definitely is. I guess we try and build our capability, particularly in new verticals, on home soil and then take it away. I think with the U.S. and Canada in particular, it's really how much leadership horsepower you have to point at certain things at any particular time. At the moment, we just see a huge runway ahead of us in the core business, which is where our focus is. As we build that capability and leadership capability across the globe, then we'll point it at the next verticals as we see fit.
Good stuff. A question online from Alex Chang for you, Justin. How is the localization of the teams in the U.S. and Canada progressing? Is skill availability a constraint on growth at all?
Yeah, thanks, Alex. With localization of the team definitely happening across various parts of North America, I think largely received well. I think we've sort of seen the benefits of a lot of that through the back end of 2025, and we'll continue to see that in 2026. It's definitely not a silver bullet, but it's something that we'll continue to sort of apply in markets where we see it suitable. Sorry, what was the second part of that question?
Expanding them into the outside of Australia.
Oh, that was Indy, sorry. The other one, sorry. A constraint on growth. Constraint on growth.
Yeah.
No, look, it's probably more having so many things on the table at one time. Really around us, we want to pick the markets that we want to belong in. We want to give those our time and effort to make sure that our customers are getting a great experience, our people are getting a great experience, and sort of grow responsibly and sustainably and make sure it sticks is the real priority for us, Alex.
Good stuff. Question from Justin [Nuich] online. Just curious about the stated dividend policy. What is the logic of the targeted payout ratios? Justin, I guess the way that we structure our payout ratio is one-third is approximately one-third is returned to shareholders and two-thirds is reinvested in growth. I guess that's a metric that we've held true for the last 20 years. We're a high-growth business. We're a growth-focused business. That two-thirds of NPAT reinvested in growth is sort of the benchmark that we think we need to be at in order to keep the growth rates up as a business. It's always under review, obviously, but that's where it sits currently. Question from Marcus Burns from Spheria. We're probably going to have to wrap it up very shortly. The question was, how is skilled recruitment going in North America?
Yeah, go, Marcus. Yeah, look, it's going well. I guess when we talk about North America, we've got sort of two streams there. One is the Global Pathways of our Australian expats that go and spend their secondment time over in the U.S. or Canada. That continues to be a really strong stream inputting into those markets. Even more so now into the U.S., given we're back into a nice sort of growth profile there, we'll look at expanding that Global Pathways opportunity to those over there. Local recruitment is still very good.
I think as we're building a brand over there and becoming more well-known, it's becoming an exciting opportunity for Canadians and Americans that want to sort of work outside a region and do the things that I guess the Mader model allows them to do, which is sort of travel around their own country and see lots of different things and work in different regions, different commodities, on different rosters. As that's becoming more and more well-known, it's definitely an attraction piece for employees wanting to work with us.
Good stuff. Last question, because we do have to get on to another couple of calls in just a minute. Last question from Marcus. Can you make any call-outs in terms of the mineral exposure and the growth in various areas in North America? Gold versus coal versus nickel, etc.?
Yeah, thanks, Marcus. Look, definitely seeing a lot more buoyancy in gold and copper in the U.S. in particular. Coal, you know, showing some signs, but early days. We thought it may switch on a little earlier. You know, definitely making the right noises, but probably just yet to see that sort of transform into any real sort of headcount growth in those areas. A little bit of met coal over on the East Coast, but the rest of the aggregates are still going really strong. Those are probably the main ones.
Agreed. All right. There are still a few unanswered questions. I can get back to those individuals in writing throughout the course of the day just to make sure we close them out. We do have to end it there at 15 minutes to because we do have to jump onto another call. I'll hand it back to you, Rocco, to close the call.