Thank you for standing by and welcome to the Southern Cross Electrical Engineering Limited FY 2025 Results Webcast. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, please enter it into the 'Ask a Question' box and click 'Submit.' I would now like to hand the conference over to Mr. Graeme Dunn, CEO and Managing Director. Please go ahead.
Good morning and afternoon, ladies and gentlemen, and welcome to SCEE 's full-year results presentation. Turning to slide two for a brief introduction to SCEE. SCEE is a leading and trusted national provider and manufacturer of specialized electrical, instrumentation, communications, security, fire, and maintenance services and products that operate across the three broad market sectors of infrastructure, commercial, and resources. We operate through several company entities, as shown, that have been acquired through our disciplined M&A strategy. During the year, we have added to our list of operating entities with the acquisition of Force Fire . There is a more detailed slide on Force Fire later in the presentation.
With our focus on operational excellence, we have delivered profitable growth over many years that has culminated in SCEE achieving another record profit this financial year, following on from the record profit achieved in the last two years. A key takeaway from today's presentation are the six thumbnails at the bottom of the slide that outline the investment proposition for SCEE . Firstly, we are heavily exposed to the growth tailwinds of decarbonization, electrification, data centers, and overall infrastructure investment. We are diversified across markets and operations and have a long-standing blue-chip client base. We continue to grow the recurring revenue and deliver earnings growth that has resulted in a financially strong company with strong shareholder returns, and finally, we have a track record of successful acquisitions.
Turning to slide three for a reminder of our stated strategy. SCEE sees electrical contracting as its core capability, whilst increasingly diversifying into adjacent disciplines and servicing the infrastructure, commercial, and resources sectors. We will grow by deepening our presence in those sectors and broaden our geographic diversity through expanding our core competencies and adding adjacent and complementary capabilities, either organically or by acquisition. We are increasing our exposure to recurring revenues with service and maintenance style works. We are actively exploring acquisition targets, offering further geographic diversification and new capabilities, and we aim to maximize the synergies and cross-selling opportunities created by the increasing diversification and multidisciplinary nature of the group. Now turning to slide five for a summary of our record FY 2025 financial performance. Our record revenue of AUD 801.5 million was up 45.2% on the prior year.
Our record EBITDA of AUD 54.8 million was up 36.6% on the record prior year. Our record EBIT of AUD 45.9 million was up 40.4% on the record prior year. Our record NPAT of AUD 31.7 million was up 44.5% on the record prior year. The result included AUD 2.7 million of acquisition amortization. We ended the year with another record cash of AUD 88.6 million, up 5.3% on the prior record year. Our order book was AUD 685 million, slightly down on the previous record year. The Force Fire acquisition contributed in the final quarter, but broadly netted off against acquisition costs. Infrastructure remained our largest sector with 63.8% of total revenue, and we declared a fully franked final dividend of AUD 0.05 per share. Overall, another great result for the group. To take you through the next four financial slides, I'll pass you over to our CFO, Chris Douglass.
Thank you, Graeme. Turning to slide six. Yes, it's a record revenue of AUD 801 million, up 45% on the prior year. The split of those revenues by sector was infrastructure contributed AUD 511 million, commercial was AUD 152 million, and resources AUD 137 million. Infrastructure was again our largest sector, and it more than doubled on the prior year. Particularly driving that was the Collie Battery Energy Storage System project, Western Sydney International Airport, and various data center projects we're doing in New South Wales in particular. Supporting other sectors was BHP, Rio Tinto, Woolworths and Coles, sustaining capital, and maintenance style works. All of that resulted in a record gross profit of AUD 105.9 million, which was up 28.1% on FY 2024. Pleasingly, whilst the gross margin percentage for the year was only 13.2%, down on the prior year's 15%, the margins did recover in the second half.
The first half of the year, margins were 12.7%, they're back up to 13.7%, and we're now getting closer to our sort of general guideline of being in the 14%- 15% range going forwards. Included in those gross margins in the first half in particular was the bulk of the AUD 4 million of legal costs we incurred in the year relating to the WestConnex arbitration, and that first half was also impacted by a less profitable commercial building services mix in Sydney as well. Overall, overheads as a percentage of revenue declined to 6.6% compared with 7.8% in the prior year, and we do note that the second half overheads did include AUD 2.5 million of acquisition costs for Force Fire . This all resulted in a record EBITDA of AUD 54.8 million, up 36.6% on the prior year, and that surpassed the guidance of at least AUD 53 million.
Again, record EBIT and NPAT up 40.4% and 44.5% on the prior year, and noting that in the EBIT and NPAT there was AUD 2.7 million of acquisition amortization, mostly relating to the MDE and Force Fire acquisitions. Turning to the next slide about the balance sheet. Pleasingly, we had a year-end record cash balance of AUD 88.6 million, and that was despite having to pay AUD 32 million for the Force Fire acquisition in the second half. We're very pleased with the cash result. The business remains debt-free. We had a record amount of bonding on issue at 30 June, AUD 115.2 million out of our capacity of AUD 150 million.
However, that bonding headroom will probably increase coming into the half we're in now because we do have a significant amount of bonding out securing the Collie BESS advance payments, and that should be returned in the half we are in now. The franking account balance was AUD 61.5 million, and we've maintained our final fully franked dividend of AUD 0.05 per share, which will be paid on the 8th of October . Record year-end cash on slide eight, and a record payout of dividends in the year of AUD 19.1 million of fully franked dividends.
We had some big tax payments out in the year as well, and of course, the AUD 33 million of acquisition payments relating to MDE and mostly for Force Fire , which is the reason why we're very pleased with the cash result because those are significant outflows that had to go out in the year as well. Included in the AUD 88.6 million is there are still AUD 12 million of advance payments on the Collie BESS project that will effectively be repaid in the first half of FY 2026. Turning to slide nine and the order book, again, the order book was AUD 685 million, only slightly down on FY 2024's record order book of AUD 720 million. We're very pleased again with how we've managed to hold up the work activity of the group.
Noting that infrastructure is overwhelmingly the largest component of the order book with almost 2/3 of the AUD 685 million. The order book is again very much on the East Coast, 75% of it. One thing we do want to highlight to people going forwards is really the breakdown of our order book by the different disciplines now, particularly driven by the acquisition of Force Fire . We have now 25% of our order book in the non-electrical disciplines. I'll turn back to you at that point, Graeme.
Thank you, Chris. Turning to slide 11 and the operational highlights and outlook slide. Very pleasingly, we were lost time injury-free across the group for the third consecutive year, having undertaken 3.5 million man-hours in the period. Our workforce stood at circa 1,900 direct employees. We've just recently announced the appointment of Louise Daw as an independent non-executive director effective from the 1st of September 2025. The Collie BESS project is passing peak activity and is performing well with practical completion on schedule for the first half of FY 2026. I was down there last Friday, and it's an outstanding project coming nearing completion. The Western Sydney International Airport Terminal project has been successfully completed, and further airport works have been awarded. In the period, we were awarded the Shell harbour Hospital project, our largest ever hospital contract.
There were further awards at the NEXTDC Artarmon project, as well as other data center contract awards across the group. The Trivantage Manufacturing order book reached record levels in the period. We remain confident in the pipeline of projects with growth in data center, battery energy storage, and industrial warehousing projects across Australia. The Force Fire acquisition was completed on the 1st of April, and they had a strong final quarter in FY 2025. We are excited by the wider capabilities and disciplines that we have developed in the group, providing increasing cross-group opportunities within our markets. There are currently multiple further acquisition targets being explored that we have the financial capacity to execute. The WestConnex arbitration was commenced in the period, with resolution expected in the first half of FY 2026.
Looking forward, we are anticipating an FY 2026 EBITDA guidance in the range of AUD 65 million- AUD 68 million. This represents a growth of 18%- 24% on the FY 2025 EBITDA, continuing our record run over the last couple of years. Overall, a very successful operational year for the group. The next four slides look at the widening capabilities and the emerging cross-selling synergies across the group. Turning to slide 13. Over the past 10 years, SCEE has diligently implemented its strategy to transform itself from a pure-play electrical contractor in the resources sector into a multidisciplinary industrial service group across a wide range of markets. In doing so, we have grown our revenues over the past 10 years from AUD 208 million at the end of the resources CapEx boom in FY 2016 to over AUD 800 million across multiple markets, offering a range of multidisciplinary services in FY 2026.
Our most recent acquisition of Force Fire has introduced new services, being wet and dry fire capabilities. It has also introduced the new market sector of industrial warehousing and expanded our capabilities in our existing markets of commercial building services, data center services, and renewables. To build on that, we'll turn to slide 14 for additional background on Force Fire. As stated previously, the acquisition of Force Fire on the 1st of April 2025 is consistent with SCEE 's strategy to add adjacent and complementary capabilities and increase our exposure to services and maintenance style works and recurring revenue. The key highlights of the transaction are the fire market is attractive due to the nature of its non-discretionary and critical technical services requirements. It has a highly recurring revenue base with repeat clients, many of whom are long-term blue-chip clients.
It has a capital light operating model, and it has industry-leading expertise in industrial and data center end markets. With our widening capabilities, we continue to expand and maximize our group synergies as outlined on slide 16. As we aim to maximize the synergies and the cross-selling opportunities created by the increasing diversification and multidisciplinary nature of the group, there are several key opportunities to pursue. There is an overlapping of client bases that we can develop, can lead to deeper relationships and business development coordination. We have the ability to propose combined service offerings that our competitors cannot match. This was clearly displayed in our resources camp upgrade projects in recent years, where we combined the capabilities of SCEE Electrical, Datatel, and SEME to provide a seamless delivery of electrical, communications, and security services.
We are leveraging the group's overall economies of scale, buying power, and established processes to drive efficiencies in each business. In general, we are sharing the expertise, best practice, market insight, and skill sets across the group to improve our project outcomes. In summary, over the last 10 years, the group has grown tremendously in terms of markets, capabilities, and financial results. We look forward to continuing to grow and leverage our capabilities across our market sectors in the coming years. Now turning to a brief update on our diversified sectors on slide 18. As Chris said, the infrastructure sector is clearly our largest sector now with 64% of revenue. The next slide after this one will provide additional information on this sector.
In the commercial sector, we can see the commercial buildings have now stabilized at lower post-COVID activity levels, with the Atlassian building and City Tatts redevelopment to contribute in FY 2026. The supermarket spend is steady. Overall, the sector will grow in FY 2026 with contribution from Force Fire 's commercial and industrial warehousing works. The resources sector is at constant consistent volumes in the absence of major greenfield development projects. There was a steady flow of sustaining capital type works in FY 2025, and this is expected to continue in a similar manner in FY 2026. Now turning to slide 19. Infrastructure is a very wide sector for SCEE that spans across federal, state, and private investment in transport, road, rail, airports, ports, defence, data center services, education, agriculture, water, energy, renewables, utilities, health, and aged care. I think you get the point. It's very wide.
Outside the data center services and renewables, this sector remains particularly strong for SCEE and includes the Shellharbour Hospital, Heyday 's largest ever hospital award at over AUD 60 million that is currently ramping up. We are currently positioning for further major hospital developments that are presenting in the medium term in New South Wales and the ACT. At the Western Sydney International Airport and Aerotropolis, the terminal project for Multiplex is now completed. Again, a very successful project. However, the FY 2025 revenue has now been replaced with the WSIA Stand Alone Facilities Project for FY 2026 that have been recently announced. We're expecting a long-term pipeline of works at the airport and the surrounding Aerotropolis region. We're currently tendering for the airport line and Sydney Metro West Station developments. Pleasingly, Trivantage Manufacturing has already been awarded the switchboard supply for the airport line.
Additionally, Trivantage Manufacturing are supplying products for multiple further transport developments in New South Wales and Victoria. We are performing the early works at the Alkimos desalination plant in Western Australia. Now turning to slide 20 for a discussion on data centers. The SCEE businesses have worked on data centers for over 20 years, and the sector is experiencing exponential growth. Within the sector, SCEE businesses have multiple touchpoints, including Heyday having a very strong position in general construction in New South Wales and extensive experience in data center construction. Trivantage Manufacturing builds and supplies sophisticated electrical equipment required for data centers. Datatel and MDE offer communications, SEME offers security solutions, and Force Fire offers wet and dry fire solutions. Clearly, we cover many different activities within data centers.
In FY 2025, we turned over approximately AUD 120 million in data center revenues and are expecting similar or increased levels in future years as we are tendering on or positioning for over AUD 500 million of work to be awarded in the next two years for extensions at existing or new builds of multiple data centers. Clearly, a significant tailwind for the group. Now turning to another strong tailwind, electrification and renewables on slide 21. SCEE has multiple exposures to Australia's energy transition, which requires electrification of many activities by 2050. This particularly includes transforming the electricity supply to run on non-carbon fuels and the electrification and decarbonization of existing industries, transport networks, and the built environment. The transitioning of the electricity supply requires investment in renewables supported by battery storage and grid reconfiguration. For SCEE , this provides enormous opportunity.
Currently, SCEE participates in this thematic, having constructed multiple solar farms, wind farms, and battery energy storage systems. In early 2026, we will successfully complete Synergy's 500-MW Collie BESS project, which is over AUD 200 million of work for SCEE . Force Fire is nearing completion of the installation of fire safety solutions on the Macintyre Wind Farm in Queensland for Nordex. Going forward, we are currently tendering for multiple battery and wind farm developments across Australia and expect to announce further battery pod projects in the near term. Outside the electricity supply transition, SCEE offers services across a huge range of other electrification initiatives, including decarbonizing our client operations by improving the power efficiencies of supermarkets, installing LED lighting in education facilities, and manufacturing solar security gates.
As buildings become more sustainable, we are seeing a drive to increase the electrification of buildings that presents many opportunities for SCEE . As I say, it's a great time to be an electrical contractor. Building on this, the next four slides further develop the investment proposition for SCEE . I'll briefly comment on each of the slides. Turning to slide 23. This slide presents SCEE 's compound annual growth rates over the last five years for the EBITDA and EPS metrics. Clearly, our strategy has been successful in growing the business with high double-digit growth across these metrics. Looking forward, we are anticipating an FY 2026 EBITDA guidance in the range of AUD 65 million- AUD 68 million. This represents a growth of 18%- 24% on the FY 2025 EBITDA. Hopefully, this is an attractive investment proposition for our shareholders. Turning to slide 24.
A key point of our strategy is to grow our recurring revenues. In FY 2025, we achieved a 15% growth to AUD 211 million of recurring revenues. As noted in the slide, we operate across both a wide range of recurring works contract types and across a wide range of sectors. Pleasingly, there is a depth and longevity to many of our arrangements that all SCEE Group companies contribute to. Turning to slide 25. As mentioned previously, the company's financial position is very strong, with record cash of AUD 88.6 million and no debt. For FY 2025, we declared a fully franked final dividend of AUD 0.05 per share. This added to the interim dividend of AUD 2.5 per share. Turning to slide 23.
Over the past nine years, we have completed five value accretive acquisitions that have all been consistent with our strategy of growing the SCEE Group through deepening our presence in the infrastructure, commercial, and resources sectors, and broaden our geographic diversity with the expansion of our core competencies by the addition of adjacent and complementary capabilities. This is something that we will continue to do as we explore a range of acquisition targets, offering increased geographic diversification and new capabilities. I also note that we have the financial capacity, operational excellence, and corporate experience to undertake further acquisitions. In summary, we believe SCEE has a compelling investment proposition. Now turning to our final slide and in conclusion. Our revenue was up 45.2% on the prior year to AUD 801.5 million. We had record EBITDA and NPAT that were all up on the prior record year.
We ended the year with a record cash position of AUD 88.6 million that was up 5.3% on the prior year, and we continue to have no debt. The order book of AUD 685 million was slightly down on the record prior year. We declared a fully franked final dividend of AUD 0.05 per share. There is a growing pipeline of data center, battery energy storage, and industrial warehousing projects across Australia. We successfully completed the Force Fire acquisition on the 1st of April, and they had a strong final quarter in FY 2025. Our wider capabilities and disciplines are offering up increasing cross-group opportunities. There are currently multiple further acquisition targets being explored that we have the financial capacity to execute. Looking forward, we are anticipating an FY 2026 EBITDA guidance in the range of AUD 65 million- AUD 68 million.
This represents a growth of 18%- 24% on the FY 2025 EBITDA. Overall, another very successful year with a very promising outlook. With that, we will now start with the Q&A.
Graeme, maybe I'll answer the first couple of questions while you get your breath back. First question is, how is workforce availability? As you can see, our workforce is at almost record levels of 1,900 direct employees. We're not struggling to source labor for our work. We keep telling people we're top payer in the industry. People like working for us. We have great safety records and all that sort of thing. We don't struggle to recruit our workforce. Next question is, will the Trivantage Manufacturing plant move affect the results? This is referring to in Brisbane, we're moving into a new facility to which we have now been given the keys, and we're doing the fit-out, a new facility near the airport, which will replace the two existing facilities we have in Brisbane. The answer is no, it won't affect the results.
We'll be able to move across the facilities in a sort of staged way, which won't really materially impact the workings of that part of the business. Going forwards in the longer term, it will affect the results we hope because we've got bigger capacity there, and we should be able to further grow the revenues of the manufacturing business. The next question is, in our guidance, have we included any effects of not yet materialized acquisitions? The answer to that is no. Our guidance of AUD 65 million -AUD 68 million is only from the existing businesses in the group. Any acquisitions that are executed during the course of FY 2026 and contribute, that contribution would be on top of the guidance.
Thanks, Chris. There's a question here about potential battery project timing awards. I don't think we can go into specifics of the timing of those projects. We would certainly say within the next six months, we will be hopefully awarded some additional battery projects and renewable projects. There's a question also about how competitive that is. Our general view is everything is competitive in the construction space. I guess it's no different to other areas that we operate. We welcome competition, and we like competing against similar businesses to ourselves. There's a question here about how we're seeing the commercial space activity and tender pipeline, specifically outside Force Fire . We mentioned in the presentation that we see that it's sort of stabilized at probably pre-COVID levels in terms of the commercial space. We have lots of different areas that we are involved in commercial.
We have SEME, we have Datatel, we have the Heyd ay business, we have Force Fire , and we're spread across nearly all states. It will still be a key component of our activity as we move forward. It certainly will grow this year with Force Fire , and we can continue to see opportunities going forward as there's more electrification of buildings, there's more retrofitting of buildings, etc. Those projects that we currently have are performing well. I was at the Atlassian building about a month ago. Again, another outstanding project that we're working on there in Sydney.
Next question is, should we be expecting any legal costs in FY 2026? The answer is yes, there'll always be legal costs until proceedings get resolved. We do believe we have expensed a great bulk of our costs on this arbitration proceedings. We think perhaps in, and you can never be in control of the number, but for H1 FY 2026, it might be at a similar level to what we experienced in H2 of FY 2025. Next question, do you see more contract wins from the Department of Defence coming through in FY 2026/2027? We do have a few around the group bids on work in defence. It's not a huge amount. We always do have some work going on in the defence sector, but it isn't a big area for us at the moment, so we don't really call it out as a separate thing at this point in time.
Do you want to go to the next one?
Yeah. I think there's a question here on data centers about how strong the outlook and potential contracts. The outlook is very strong at the moment. You can just read in the papers consistently about clients that are developing more data centers. I think we're only at the beginning of AI and the impact that it will have on society and the amount of work that that will require in data centers will exponentially grow. For us, we did AUD 120 million worth of data center works this last financial year. We can see that sort of number continuing for us, and at different times it will grow depending on the timing of individual contracts that we pick up.
In terms of the complexity of data centers, there is a sort of a level of complexity, the main thing being that data centers are different to other projects that they usually have multiple. They all have multiple power sources. Sometimes they'll have two different parts of the grids feeding them, as well as temporary and backup powers within the system. I guess the complexity comes to separating those different power supplies so they're not crossing over and you're not affecting the redundancy of it. That's something that we have a lot of experience at, and we do the designs, the electrical designs for these projects. We're in a very good position in that data center work.
The next question is, how difficult is the market for acquisition opportunities? A sub-question within that is, given the tailwinds, are multiple businesses expecting going to rise? The market is probably the same as always for us. We're always active in looking for targets, and there are not many natural acquirers of the style of businesses we look for. We don't think the market has changed really in that sense. Multiples, again, you know, the sort of businesses we look at are the ones that are interested in the multiples we're prepared to offer. It becomes a bit self-fulfilling in that sense. I think the answer is really we're expecting acquisitions that we make will be similar in nature to the ones we've done in the past.
There's a question on the Alkimos desalination plant. The main contract hasn't been awarded yet. It's probably, I can't exactly say, but it'll be maybe in the next.
I think officially it's within six months, but I would suspect it may take a bit longer.
Yeah, okay, very good.
Where are we in terms of broader electrification demand?
In terms of the broader electrification demand, we just see it continuing to grow. I think it's terrific tailwinds, be it the battery, electrification, renewables, building electrification, data centers. I think the list goes on. Whatever you touch these days is being electrified. In broader terms, as I said in the presentation, it's a great time to be an electrical contractor. There's a question about, do we get to work with the data center operators like Equinix? At different times, we work across a wide range of data center operators. Some like us to mention their names and others don't. We would work across nearly a dozen different data center operators, and I would say that that's across different parts of the business. We provide security, we provide electrical, we supply switchboards, and we supply fire. We don't do all of those things for all of the clients.
MDE as well work for certain data center operators. Yes, we have a broad spread of data center operators that we work with.
Should I do the next one? The last question we have here is, are you centralizing the group's tendering process when projects offer multidisciplinary contracts or are business units tendering separately? I guess the answer is no because, no, we're not centralizing our group's tendering process. The way to think about it is really there'll be a lead business tendering for the project, and then they will go back to the other businesses in the group for support. An example of that might be on some of these battery projects we're now tendering on. SCEE Electrical will be, as the electrical contractor, leading the process, but then they might be referring back to Force Fire for the fire support, MDE for the comms support, Trivantage Manufacturing to build the switchboards, and SEME to do the security.
That will be the style of how we expect to do these things at this point in time.
There was one other one here, Chris, that said, "Thank you for doing an excellent job." That was the best question that I received. Thank you for that one.
Should we finish on that note, Graeme?
All right, I think we've addressed all the questions. Thanks everyone for listening.
That does conclude our conference for today. Thank you for participating. You may now disconnect.