Morning, good afternoon, everyone. Also joining me is Peter Bryant, in his first time as NRW CFO, but obviously many times over the years in his capacity as a CFO of a listed company. If we go on to page, we'll sort of start with some opening remarks. There are just many positives in our underlying result. It's been a pretty challenging year. The South Australian government placing OneSteel into administration, of course, had a major impact on the business. Despite efforts ensuring we held a strong security position over the past, as many of you are probably aware, the South Australian government had amended or written new legislation on two separate occasions since the administration to essentially void our security or avoid our security position over those assets in order to simplify the wireless sales process. That's been obviously very disappointing.
Our efforts to recover the impaired balance, of course, are still underway. We've got a number of initiatives happening at the moment. We'll continue to seek the best possible outcome for all shareholders. The second impact to the business isn't so much of a similar one to the first one, but more an act of God, where we experienced probably double the rainfall throughout Queensland, which impacted the Golding business, but particularly the mining part of NRW's Golding business. Also during the second half, it was bad in the first half, but also continued to be higher than average rainfalls in the second half. Having said those, a couple of negative things, we'll move on to the positives for the rest of the presentation.
On page three, the group increased revenue by 12.2%, which was driven by strong growth in both the MET and Civil business, which performed exceptionally well. Our underlying EBITDA also increased with margin expansion in MET and Civil. However, as I just mentioned, the mining margin was significantly impacted by the higher average rainfall. We also had a suspension of the Mount Cattlin contract, which was a lithium project in WA , which finished early, and a bit of de-scoping of fleets at Curragh. Cash holdings remain strong, $265.7 million, and also strong cash conversion, 82.9%, which is sort of around our long-term averages between 80% and 90%. Order book, very strong at $6.1 billion. The near-term tender pipeline has actually grown from the half by a couple of three, which is for tenders that can be bid and commence within the sort of 12-month period.
In that, there's active bids of $5.6 billion, again reinforcing the strong position that the company is in, not only for FY 2026, but 2027 and beyond. If you look at the coverage that we have at the moment on our order book, it translates into about 90% of our FY 2026, $3.4 billion revenue guidance being covered already, which is a very strong position to be in at this time of the year. Finally, the board declared a fully franked final dividend of 9.5% for the end of the financial year. Onto the sustainability overview. We've seen a slight uptick in the TRIFA, which obviously isn't great, but we're working, it's our highest priority in the business, the safety of our people, and we're working hard to ensure we continue to see those trend down over the coming period. People numbers grew pretty strongly.
We're up about 1,000 people from the prior period, reflecting not only the HSE acquisition and the people that came along as part of that transaction, but also growth in the business. We're going to continue to see those numbers trend up. We've strengthened our commitment to psychosocial safety. We're partnering with Supply Nation to support further engagement with the indigenous businesses. Obviously, continued investment in training and development with a significant number of apprentices, graduates, and people in the graduate program as well. On a participation rate, diverse gender diversity, we continue to pick up the female participation rate, which is obviously very encouraging. In terms of our reduction in emissions, we're also continuing to improve those stats. As you can see, we've had a 51% reduction in emissions intensity within our facilities. That's the sort of the first part of my presentation.
I'll pick up again on the segment results, but I'd now like to hand over to Pete to talk about the financial results.
Yeah, thanks, Jules. It's great to be here doing my first NRW results call. I'd like to take this opportunity to welcome everyone to the call. In my three months with the business, I've met face to face with many of our shareholders and analysts. For those who I haven't met, I look forward to catching up with you over the coming weeks, hopefully. From my perspective as a newcomer to NRW, I'm happy to be part of presenting what I see as a very solid set of numbers, particularly against the backdrops of the wet weather in Queensland and distractions and frustrations caused by OneSteel, which Jules touched on. I think it's a testament to the strength and diversity of the group and the quality of the people that make up NRW that we're able to deliver underlying earnings against these headwinds. Slide five reflects the high-level P&L.
Jules has called out the key numbers, and as he said, I'll hand back to him shortly to run through the segment performance. That pretty much leaves me with the highly engaging commentary on interest and tax. That said, I'll also provide a bit of cover around the non-underlying items, which are presented on the next slide. Before I jump into interest and tax, I thought I'd just reiterate the point made around the EBIT margin. EBIT margin for the year was 6.3%, which is a tad down on last year's 6.6%. This reduction was due in part to the underperformance of the mining segment as a consequence of the weather, but on a very positive note, I think it was due to the greater earnings contribution from the lower margin and lower capital-intensive civil and MET businesses. Onto interest and tax.
Our interest expense did increase year on year, driven by three key drivers. We made an increase in our draw equipment finance lines due to the financing of the HSE South Walker Creek fleet that came across as part of the acquisition. We drew around $50 million on our recently upgraded bank debt facility to help fund working capital requirements of HSE and to provide additional working capital to the broader group, largely off the back of the OneSteel non-payment. Finally, we incurred circa $600,000 of interest expense related to the amortization of the establishment of that new bank facility that I just referred to. Tax expense in the P&L, and I stress this is the P&L, not cash tax, was well down due to the excellent work of NRW's relatively new Head of Tax and his team, who secured a prior period tax refund.
The positive outcome, or this positive outcome, was amplified by the accounting impairment of OneSteel and the other non-recurring items, which saw the accounting tax expense being set on a lower statutory earnings base. Moving to slide seven, which provides a summary of the non-underlying items. This balance is bigger than you would have traditionally seen, which won't be a surprise as we previously called out our intention to impair the OneSteel receivable. Running down the list, impairment of trade receivables and contract assets. This balance captures OneSteel, Strandline, which primarily did some work for prior to FY 2024 and who went into administration owing us $6 million in February of this year, and a further allowance booked by the company. Importantly, this amount excludes the movement in our expected credit loss, or ECL, which is reflected in our underlying results.
Next, we have another amount related to Strandline, which reflects a payment to secure the release of the insurance bond under the contract. Business acquisition costs relate primarily to $5.5 million of stamp duty paid on the acquisition of the HSE South Walker Creek assets. Finally, we have a net gain on investments, which is the mark-to-market impact of a small portfolio of investments held by the group. For completeness, the book value of those investments at 30th of June was around $7 million. Importantly, particularly in the context of the material impact of OneSteel, the non-underlying items will deliver a tax benefit to NRW of just shy of $43 million. Moving to slide eight, cash flow. Jules called out the cash flow conversion. Just reiterating it, that is within our group target range. I don't plan to run through all the numbers in the cash flow.
I'll just touch on a couple of the material movements. Cash interest was up year on year for the reasons I ran through going through the interest expense in the P&L. Cash tax was up, which is counter to the reduction we saw in the tax expense in the P&L. Whilst tax always has a degree of complexity, at a high level, the most significant driver for the variance between cash and P&L tax is the timing of the deduction that will be received for OneSteel if the debt is ultimately not recovered. From an accounting perspective, the FY2025 numbers include the impairment. From a tax perspective, no deduction until we formally write off that balance, if that is what occurs.
Aside from the above, the increase related to last year is a result of some benefits received through accelerated capital deductions during the COVID period, resulting in a slightly higher non-deductible depreciation this year. Net capital expenditure notably down year on year, reflecting continued focus on capital management. Payment for business combinations is the HSE acquisition stamp duty, and the bank and other finance movements, I think, are covered in the interest commentary. Moving to slide nine, most of the material movements in the balance sheet have been explained as we ran through the P&L and the cash flow. I think the only movement that requires commentary is working capital that went from a debit balance of $25.024 million to a credit balance of $44.325 million.
Sounding a bit like a scratch record, but like a few other things, this movement is primarily related to OneSteel, which effectively saw the receivable, which is a debit balance in working capital, being written off by posting your credit balance. There were also a couple of other minor movements in working capital related to the acquisition of HSE South Walker Creek, but the main movement is that receivable impairment. Finally, for me, slide 10. This is a new slide to the deck and provides an overview of both our net debt position and our available liquidity. The call out for me is the table on the right-hand side that shows both the drawn and committed amounts of our bank facilities, our equipment finance facilities, and our guarantee and insurance bonds facility. With the total committed undrawn value of these three facilities sitting at just over $8 billion.
In the box at the bottom of the slide, I've excluded the equipment finance and guarantee and insurance bond capacity, given these facilities are quite specific in relation to what the funds can be used for. At 30 June, looking at our cash on hand and our undrawn bank debt, we have available liquidity of just shy of $600 million, which provides significant capacity to fund working capital and strategic corporate activities if and when the right opportunities present. That's it for me. I'll now hand back to Jules.
Thanks, Pete. I'm going to go to slide 12, which just gives us the segment overview. From there, you can clearly see the heavy lifting that both the civil and the MET divisions have done. Strong growth at top line, but also very strong growth at an EBITDA level. I'll talk about those individual sub-projects in a minute. Mining is relatively on par versus the prior year, despite the fact we've seen growth in the mining business given the addition of the South Walker Creek contract. You can clearly see the impact that those challenging weather conditions have had on the business during the year. If we move on to Civil, strong performance. Obviously, significantly improved margin. A lot of that's driven by higher activity across the key Pilbara and Bowen Basin regions.
Bowen Basin still experienced a lot of rain during that period, but relatively clear in the Pilbara on higher volumes. We successfully completed a number of projects, including the Bunbury Outer Ring Road, which completed in December 2024. A couple of projects for Rio , and the two Alliances, which were essentially not contributing to margin. They were Alliance-style projects running at relatively low or nil margins, are now out of that civil business as well, which again will contribute to improving margins as we look forward. West Australia and Queensland are both experiencing significant surges in infrastructure development. A lot of projects coming online, be it port, be it defense, and of course, a significant demand remains from our tier one iron ore majors as well for sustaining and capital works. Very good outlook for the civil business at the moment with those backdrops.
Active tenders also will reflect that story. I think, if you look at the order book currently versus the active tenders, that active tender pipeline is probably as big as we've seen it in a long time. I'm feeling very positive about the outlook for our civil business moving forward. Another good contributor to the margin during the year has been our urban business. Between urban, the activity across the Pilbara and still robust activity in Queensland has seen a markedly improved performance from our civil business. Onto mining. Obviously, the revenue increase was due to the addition of the South Walker Creek contract, which I think commenced as of August during the year.
That contract, the five-year extension to that contract actually commences in January 2026, where we'll also operate clients' equipment as well as managing our own fleet and equipment there, which will see a step up in terms of activity on that site. It's also under a slightly different commercial structure, whereas the commercial structure of the extension was sort of an hours-based recovery versus a production-based contract, which is more consistent with the rest of our business. With that, the full-year contribution of Evolutions Project, which started in February this year in 2025, or sorry, FY 2025, again, we'll see full-year contribution from Castle Hill. A very different picture. Assuming the weather goes back to long-term norms, we should start to see those margins tick back up in the business, particularly this year and obviously in forthcoming years.
Active tenders still pretty strong, quite a diverse group of tenders in there across gold, coal, and other metals. I think we're very active in terms of our tendering at the moment. At $2.9 billion, there's a pretty good position to be in. We go on to our MET business. Again, very strong performance from MET in terms of top line growth and also margin improvement. Both DIAB and RCR had a very strong year, particularly in the second half. Primero has continued to grow through its contract at Fimiston. It completed Western Range and some work it was doing at Pilbara Minerals as well, but lots of activity happening. A couple of good contracts awarded during the period, one at Coastal Waters for Rio Tinto and also the Hope Downs to satellite embedded Hilltop NPI project. Lots of work ahead. $1.3 billion in the order book.
At this point, there's a very strong position to be in. Also, obviously, a pretty large active tenders pipeline as well across projects, feed studies, a number of other things that they're working on at the moment. It's a very busy period. Some of the key highlights for me in terms of RCR. We launched the Sealed Pan Feeder, which is our new innovative product, which reduces the capital intensity capital costs for our clients. That product has been rolled out at the Mine Expo in Vegas, which was last September. We were very encouraged by the interest from clients, not only in Australia, but also internationally. We'd expect to see our products, parts, and services business to significantly expand in the period to come, which is a great opportunity for us. The MET business continues to work on, particularly Primero, on lithium processing technologies that we've been involved in.
We're onto our third pilot plant now, getting close to the commercial pilot plants at a stage. These things that we're working on in the background are absolutely a part of the potential of our future evolution as a company. That brings us to the group outlook and guidance. As I said, the tender pipeline's actually grown. I think from the half, it was about $15 billion- $17 billion. Current active tenders are very strong at $5.6 billion. Of the order book, $3 billion is already secured for FY 2026. That would be as high as we ever see it going into a new year in terms of our secured order book. Clearly, there is opportunity to do better.
Balance sheet remains strong, as Pete touched on as well, obviously enabling any other strategic or corporate opportunities that we may wish to do despite the impacts, obviously, of Whyalla during the period. In terms of guidance, our full-year guidance is revenue expected to be a minimum of $3.4 billion and EBITDA between $218 million to $228 million with cash conversion at sort of long-term averages. That's essentially the summary. I'm happy to go to questions now. Obviously, there's plenty of good stories about our underlying result. We've had a couple of backdrops this year, but I'm very positive about the outcomes for 2026 and beyond. With that, I'll hand over 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 Will Park with Citi.
Thanks, Jules. Thanks, Pete, for taking my question. My first question relates to guidance. I mean, you've called out that there's 88% revenue coverage versus $3.4 billion that you're guiding to, so there's around $400 million left to be secured. Given the context of your robust active tender balance, can we get some sense around the timing of when these opportunities are likely to land? Maybe if you could sort of call out some of the larger ticket items that we should be watching out for in the next 6 to 12 months, please. Thank you.
Hi, Will. Look, there's lots of opportunities across the business. You know, that news flow to deliver those additional earnings obviously would happen. You'd expect to be a first-half style awards, but they're across mining and civil. I can't be too specific in terms of what the actual projects are.
Thank you. Just thinking about MET's margin, 8.6% in the second half, just wondering how sustainable that is and what the key drivers of that second half uplift in margin are. Presumably, given your comments earlier on this call, it's driven by RCR and DIAB. Just wondering what the, I guess, contribution from Fimiston was in terms of project margin profile there, please. Thank you.
Yeah. RCR and DIAB did have a strong year. Sustainable, and I mean, DIAB is a little bit more of a projects business than RCR. RCR is becoming more of a products business, but did do projects. There is clearly more sustainability in that model going forward. DIAB will have, you know, for want of a better term, swings and roundabouts. Occasionally, it'll have good years and it'll have better years. It's had a very good year in terms of the project profile and how those projects were completing during that period in terms of booking those profits. There's no additional margin being recognized at Fimiston at this point in time. We've been very clear that we're recognizing at the sort of the base end of that margin profile. Assuming everything gets delivered per plan, which we've got 12 months left to do, then there is an opportunity there.
That is not baked into our assumptions at this point.
Thank you. Just to clarify, could you give us a sense as to what you're expecting in terms of MET's margin for FY 2026? Is it at the 8% level, or is it slightly below that? Just trying to get a sense as to.
Without any abnormals, I mean, obviously, Fimiston's a large project. There is, you know, a potential gain share there depending on how the project comes out, you know, timelines and all the rest of it in terms of costs, cost targets. That business should be doing 7 %- 8% margin on a regular basis. We've always called that out. We've had obviously some challenges in the past, whether it's post-COVID, et cetera, et cetera, but the combination of those businesses should be at 7 %- 8% margins.
Thank you. My next question relates to the eliminations component in the top line. It stepped down a fair bit in the second half. I'm just wondering what's happening there, what are the key drivers, and how should we be thinking about the eliminations component going forward, please?
The intercompany revenue elimination you're referring to, Will?
That's it, yeah.
Yeah, Will, that's just a factor of the number of contracts between different parts of the group, and it moves around depending on what's being done. You just.
Thank you. Just one last question. Cash conversion that you reported in FY 2024 was around 95%. Just looking at your releases this morning, it's sort of suggesting that it's more like 82% or 83%. Just wondering whether that's related to some of the late cash receipts that you touched on in the last fiscal year. Just wondering why there is that discrepancy. Thank you.
I wasn't here for the last financial year, so I'm not sure what the commentary was. Certainly, our target internally is to be in between 80% and 90%. The nature of the business where we have advanced payments, et cetera, does mean it is going to move around a little bit. I think my comment would be my view on the debtor book at 30 June was the debtor book was in very good shape. You know that target range of 80%- 90% is where we should track. There might have been an anomaly with an advanced payment for Fimiston last year, perhaps, but I'd have to probably review and revert to you on that.
Thanks very much.
Your next question comes from Carrie Page with NRW Holdings. [audio distortion] Kerry, your line is open. We might move along to the next questioner. We have Nicholas Rawlinson with Morgans.
Hi, Jules and Pete. Thanks for taking my question. Maybe one for Pete first. You guys did a good job of reducing CapEx through the year. How should we think about that in debt by 2026?
Yeah, good question, Nick. We haven't given capital guidance. I think the $140-odd million this year is probably the kind of bottom area of the range. I think if you use $140 million as the bottom number for this year, it might be somewhere between $140 million and $160 million, but it depends what projects come across.
Yeah, Nick, we didn't have a lot of growth CapEx in the last 12 months. That number can move around subject to what we're doing, but that's obviously driven by new projects. We're working hard to kind of manage the sustaining CapEx and maintenance CapEx, obviously to continue to drive those costs down within reason, obviously making sure that we don't have any availability issues with our fleet. Close focus on that. The bit that'll swing a bit is growth CapEx, but at the moment, we actually don't need anything to hit the numbers that we're forecasting in our capital-intensive businesses, right? We've got capital. You could assume a similar number, but it just depends on if we pick something else up that needs some growth CapEx.
Yeah. Okay, great. That's helpful. Just on your guidance, trying to unpick it a little bit, obviously you had terrible weather this year, and if weather normalizes, you would suspect a big sort of EBIT uplift in your mining business. I'm just trying to understand, does your guidance take into account any coal projects potentially being placed on care and maintenance, or is it really business as usual assumed in mining with a bit of better weather?
It's business as usual. You know, the couple of fleets have come out of Coronado or Curragh, but we've obviously flagged that during this year that happened at the end of the first half. Those fleets likely will be redeployed. It's the same activity, but you've got a full-year contribution to Castle Hill. You've got the contract at South Walker Creek changing from January 2026 onwards. We get growth without capital, without any major displacement of any current jobs, which we are not factoring in. Really, the weather piece is the challenge, obviously, given the year we've had where we thought the second half would improve, and it was probably worth the level of the rain impact or at least equal. That's probably where a little conservatism is.
Awesome. That's it from me. Thanks, guys.
Thanks, Nick.
Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Evan Karatzas at UBS.
Hi. Okay, thanks, guys. Obviously, you know, the rain that impacted the mining biz, it was from a revenue perspective, and then you get the margin impact on that fixed cost base. You know, weather permitting, do you want to just touch on how you're thinking about, I guess, the improvement in revenue for the mining business into FY 2026? Just some of the moving parts or the building blocks there. Thanks.
Thanks, Evan. I think the South Walker Creek contract goes into the 300s in terms of an annualized run rate. That's dependent on, obviously, timing of client fleet arriving, us then taking over operating client fleet plus our own. That project scales up in terms of annualized run rate. Given Castle Hill only started in February, again, you get a full-year contribution to that. You see the business, the mining business, tick up without winning any new projects. It went up 1% versus PCP this time, and obviously, being very unproductive because of the rain, it's obviously impacted those margin returns. If we see longer-term averages come back, which is entirely reasonable through our mining business, you'll see a much better performance.
Yeah, okay. It looks like it's a decent setup provided to 2026, provided the rain normalizes there. Okay, and then, yeah, the civil resources pipeline as well. I mean, it looked like it stepped up massively over the six months compared to where you were in December 2025. It sounds like it's across both iron ore and infrastructure. Jules, do you want to just touch on, I guess, the competitive dynamics you're seeing there in civils? Any changes in the resources or the infrastructure market? Also, how your customers are speaking to the contract structures, especially in the infrastructure space too. Thanks.
Okay. The two different, you know, the resources space, if you look at the Pilbara market, obviously, lots of activity, probably not a lot of competitors of size and scale. You know, we've been doing it for such a long time. It was obviously the core of the original NRW business that, you know, we are well placed to participate. This pipeline, you know, I've talked about it in a couple of the results, is probably five years of pretty high activity levels. I think that's kind of it from an earthworks perspective. A lot of the things that are happening in sustaining tons and replacement tons do require heavy earthworks components. Certainty is obviously important. Certainty of delivery is very important.
There are sort of a couple of big guys or one or two, and then everyone else is sort of, you know, a lot smaller, and the scale of these projects is quite large. That's a real positive for us. When you flick to the public infrastructure phase, WA is pretty busy on public work still. There are quite a number of opportunities that we're either JVing on or pricing at this particular point in time, which will replace, you know, we did an excellent job at the Bunbury Outer Ring Road, good financial result, good quality of product. We've established ourselves pretty well in that market as well. That's kind of the drivers in the West. East Coast, civils, urbans obviously going to remain strong. Housing is in desperate demand, short supply. I think that market will continue to be strong.
It was impacted by weather, Brisbane area, not so much the Bowen, but the whole of Queensland obviously had impacts, which also impacted our civil and urban business. Really pretty buoyant in terms of the infrastructure pipeline on the East Coast. Golding don't play very hard in the bigger stuff. There have been challenges in that infrastructure market in Queensland because of BPIC and other, you know, union industry issues going on. It's not an area we play well in, but there's more than enough to do across the business in terms of that civil space. There's a lot of work over the next few years. On the mechanical side, obviously those projects for the sustaining tons projects will require crushing plants and overland conveyors and non-process infrastructure and all the other things.
I think that's again another area that we sit very well in terms of the Primero business, the DIAB business, and RCR providing the products. It's pretty good at the moment.
Everyone, sounds good. Thanks, Jules.
Thanks, thanks.
Your next question comes from Matthew Chen with Moelis.
Hi, team. Just wanted to ask about corporate line. Looked well held. Can you just talk to how you think about that going forward? Thanks.
Yeah, no, I think that corporate line going forward should be broadly consistent with how it was this year. There's a little bit of a step up in the first half, which I know Alex explained on that call, but I see it run at a similar level.
Great. Thanks.
Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Gavin Allen with Euroz Hartleys.
All right, just a quick one for me at the end. Just for context, in terms of your pipeline, where would something like roads, ridge fit into that? Like these longer-term, much bigger sort of things. Are they in the reckonings of the pipeline or are they sort of beyond that, would you say?
Hi, Gav. Look, it is in there, but it's still a fair way out. There's an awful lot of other things happening in the meantime. You know, it is something that clearly we've been involved in. I mean, roads, ridge is the equivalent of five very large mines across a very long strike length. It's an enormous undertaking in earthworks and construction. It is very much part of the longer-term pipeline.
It's part of the long-term thinking, so it's probably in that seven to eight build in a preliminary sense sort of thing?
It's more likely to be not much happening, I wouldn't have thought, till 2027. Don't necessarily quote me on that, but there are things happening in the interim.
Yeah, sure.
In terms of that sort of planning and early tons and other things, it's not for me to talk about the timing of those projects. I'm not sure what guidance Rio have given around that.
No worries. Very good, guys. Thanks very much.
Thanks, Gav.
Your next question comes from Mitch Sonogan with Macquarie.
Hi, Jules. Hi, Pete. Thanks for taking the question. Just a quick follow-up. Just in the MET business, I think you said earlier, just on Fimiston, not expecting completion for about 12 months. Can you just clarify, can you talk about when, I guess, you'll get full visibility as to when you might be able to release more or recognize more profitability on that? Just give a latest update on expected timing and when you could do that. Thanks, guys.
Sure. Look, in terms of the construction profile, we wouldn't do anything. Obviously, we haven't done anything in this result. In the next result, the half year, we could, at the half year, be at a point where we're satisfied it's sufficiently complete. It's obviously not happened in this result, but it's entirely possible in the next two.
Yeah.
It has not been factored in any forecast or guidance.
Okay, very clear. That's all from me, guys. Thanks.
Yeah, thanks.
That does conclude our question and answer session. I'll now hand back to Mr. Pemberton for any closing remarks.
Thanks everyone for listening. Look forward to catching up with those of you that we'll see in the next couple of weeks. That's it from us. Thank you very much.
Thanks.
That does conclude our conference for today. Thank you for participating. You may now disconnect.