Good morning, esteemed shareholders, colleagues, and guests. On behalf of Raubex Group Limited, I am delighted to welcome you to our FY 2026 first-half results presentation. Thank you for joining us as we unpack our performance for the six months ended 31 August 2025. This session is an opportunity to reflect on our achievements, discuss challenges, and share our strategic direction for the remainder of the financial year. We value your continued support and engagement as we navigate a dynamic business environment. My name is Felicia Msiza, I am the CEO of the Raubex Group. With me in the room is Dirk Lourens, our COO, Sam Odendaal, our FD, and Grace Chemaly, our Company Secretary and Legal Advisor. Today's presentation will cover a brief introduction to our group and the period in review.
Sam will take us through the financial overview, followed by Dirk, who will then share insights of our operational overview. I will then come back to discuss our outlook and strategy. With that, let's proceed through the agenda and explore the details behind our interim results. Raubex is proud to stand as one of South Africa's leading infrastructure development and construction materials supply groups, with a legacy spanning over 50 years. Our journey has been defined by a commitment to quality, innovation, and resilience, qualities that have enabled us to deliver impactful projects across the country and beyond. Let's begin by reflecting on the period under review. Looking at the financial performance, Raubex has delivered a robust overall performance despite isolated challenges in the first half of FY 2026. Our strong balance sheet continues to support future growth, with cash generated from operations totaling ZAR 762.4 million for the period.
We've streamlined our reporting structure to five divisions, which has helped us to focus on operational efficiencies and drive performance across the group. Looking at our operational performance, the Roads and infrastructure division stood out with strong results during this period. The construction materials division faced some setbacks due to adverse weather earlier this year, but we remain optimistic about its outlook for the remainder of the year. The materials handling and mining delivered improved performance from the second half of 2025, and we expect further gains in the second half of 2026. We continue to focus on operational efficiencies in all divisions. Looking at our order book, we have a quality order book. I am happy to report that our order book is at its highest in our history.
The order book increased by 8% to a record ZAR 30.44 billion, reflecting our ability to secure and execute profitable projects. Our diversified business model helps us spread risk and seize opportunities in a dynamic environment. We remain committed to executing our order book profitably and maintaining operational excellence. Looking at the tender activity during the period, the activity remains strong, and we've seen recent awards across all divisions. We continue to be selective in pursuing opportunities, focusing on those with a favorable risk-reward ratio. With these achievements and strategies in place, we are well-positioned for continued growth and resilience. Next, our FD will take us through the financial overview. Sam, over to you.
Thank you, Felicia. Good morning, ladies and gentlemen. Just from my side as well, very pleased to present the financial overview from our results for the six months ending August 2025. Our revenue is flat at ZAR 10.84 billion, operating profit decreased by 28.7% to ZAR 603 million, headline earnings per share decreased to ZAR 2.435 per share. We generated cash from operations of ZAR 762.4 million. Capital expenditure decreased to ZAR 581 million from ZAR 757 million in the previous half. Our order book increased to a record level of ZAR 30.44 billion. The group's operating profit margin is down to 5.6%. We declared an interim dividend of ZAR 0.81 per share, and our return on capital employed is currently at 11.2%. Looking at a summary of the income statement, we already looked at revenue, operating profit, and margins. Net finance cost decreased by 24.8% to ZAR 23.3 million.
Profit after tax is at ZAR 580.5 million. The effective tax rate is up to 30.6%. The biggest reason for the increase is that the corporate tax rate in other jurisdictions we operate in is higher than in South Africa. We also paid withholding tax on dividends received from other countries. There were also share option expenses and a fair value adjustment on the redemption of preference shares on our BEE transaction. A more normalized tax rate going forward will be around 29%. There was a loss to non-controlling interest of ZAR 38.6 million. Last year, it was a profit of ZAR 77.5 million. The minority interest is mostly impacted by the Australia performance and also Bauba Resources. Even though profit before tax is down 29.3% compared to the previous year, the non-controlling interest is much less this year, resulting in EPS and EBITDA to be down by around 14.2%.
If we look at the segmental analysis, that's the makeup of revenue and operating profit per division as a percentage of the total revenue and operating profit for the group. On the revenue side, revenue in the materials handling and mining division is contributing 16% of the group's turnover. This is down from 21% in the comparative period because of reduced production at Bauba and the curtailment of production at the Namdeb operations in Namibia. The construction materials division contribution is similar at 16%. Revenue in the roads and earthworks division is making up 33% of the group's turnover. The infrastructure division revenue contribution increased from 13% - 20%, mostly because of the increase in the renewable work. Then, showing Australia as a separate division, the contribution was 15% to group turnover compared to 18% of the previous period.
In summary, the contribution of revenue is a good spread between the five divisions. Moving over to the operating profit distribution, it was a good contribution by all divisions except for Australia, which was impacted by the loss-making project. Looking at the materials handling and mining division, operating profit contribution decreased from 21%-14%. Except for Bauba, all other operations in the materials handling and mining division performed very well during the year. At Kookfontein, the mine was in a ramp-up phase during the first six months after curtailment of production at the end of last year, and operations were impacted by the mining of a lower-grade ore body, which resulted in reduced yields. At Moeijelijk, we had a challenging underground miner at the beginning of the year that impacted production.
Even though the chrome price improved, it was not back at levels it was at the beginning of last year, and that also had an impact on the reduced contribution. The construction materials division's contribution increased from 20%-24%. Operations in this division were impacted by adverse weather conditions at the beginning of the year, but an improved contribution is expected in the second half. Operating profit contribution in the roads and earthworks division also increased from 30%-48%. All projects in this division are performing well, with a big focus on execution. The infrastructure division contribution increased substantially to 30% of the group's total operating profit, with the biggest contribution in this division coming from the renewable operations. Australia contributed 19% of the group's operating profit in the previous period, with a current contribution of -16% because of the loss-making project, which is now complete.
This division should return to profitability towards the end of the year. Moving to the geographical segment analysis, if we look at the revenue again, the South African operations contributed 79% to the group's turnover, revenue in the rest of Africa again making up 6% of the turnover. In Australia, the revenue contribution decreased slightly to 15% of revenue. If we look at the operating profit contribution, the South African operations contributed 90% of the group's operating profit, with the rest of Africa contributing 26% to operating profit. The biggest contributors to the rest of Africa are the Namdeb project in Namibia, the Bela-Bela Quarry operations in Botswana, and the Senqu River Bridge project in Lesotho. The Australian operations reported an operating loss for the period. This is a look at the group's performance over the last five years.
H1 turnover grew from ZAR 5.9 billion in 2022 to a current revenue of ZAR 10.8 billion, with substantial growth over the last few years. The record order book of ZAR 30.44 billion positions the group to sustain and increase revenue going forward. Operating profit was as low as ZAR 435 million in H1 of 2022 and grew over the last five years to just under ZAR 850 million in the first half of 2025. While operating profit and margins have softened in the recent period, this is largely attributable to isolated challenges in specific divisions. Importantly, the group's focus on operational efficiencies and cost management is expected to yield improved profitability in the coming months. It is encouraging to see the significant increase in the contribution by the infrastructure division from 2025 - 2026.
This growth is a direct result of the division's strategic focus on renewable energy projects, with the renewable order book now translating into revenue and profit. It's important to note that the group has maintained strong earnings per share over several years, even through challenging market conditions. The resilience in EBITDA demonstrates Raubex's ability to generate sustainable value. Return on capital employed is down by 11.2%, but with a positive outlook for the second half of the year and beyond, we expect the return on capital to improve. This slide highlights the diversified business model, that diversification spreads the risk and enables the group to weather sector-specific challenges while leveraging strengths in high-performing divisions. The geographical spread further enhances resilience with operations in South Africa, the rest of Africa, and Australia.
The group still has a strong balance sheet, and the result of that is that we have enough available facilities in place to participate and to capitalize on new opportunities. The biggest asset is property, plant, and equipment. It increased by 12.7% to ZAR 6.29 billion. This increase is mostly attributable to the acquisitions of the Mowcop Silica operation and Axis Mineral Services in Australia. The increase in the deferred tax asset is mostly because of the tax loss in Australia. Inventories increased by 20.6%. The increase is made up of chrome, PGMs, and gypsum stock. OMV acquired a gypsum dump at the beginning of the year to supplement their own gypsum stock levels. The increase in contract assets by 24.3% is because of stage payments at the wind farm projects of Raubex Infra. Cash and cash equivalents is at ZAR 1.56 billion compared to ZAR 2.16 billion at year-end.
We will look at the cash flow summary in a later slide. With the increase in property, plant, and equipment, borrowings also increased by 10.7%, and our debt-to-equity ratio is still at acceptable levels of around 34%. The group's net asset value per share is up by 3% to ZAR 37.78. As mentioned in the balance sheet commentary, the cash decreased from ZAR 2.12 billion to ZAR 1.56 billion. This slide indicates the major cash inflows and outflows. We generated cash from operations of ZAR 1 billion before working capital movements. Net working capital outflows were ZAR 250.7 million, with outflows in inventory, debtors, contract assets, and contract liabilities, and there were inflows in the payables. The group also paid tax of ZAR 309 million.
The biggest cash outflow was from investing activities, an outflow of ZAR 694.7 million, and this includes expansion and replacement CapEx requirements of the group, and also two acquisitions with outflows to the value of ZAR 145 million for the Mowcop Silica operation and for Axis Mineral Services in Australia. Net borrowings were an outflow of ZAR 24 million, and the group paid dividends of ZAR 230 million. We also increased our stake in two smaller subsidiaries to the value of ZAR 51.5 million, and that brings us to a closing cash balance of ZAR 1.56 billion. Management has got a big focus on cash management and cash generation, and the current focus is on reducing inventory levels to the end of this financial year. The group will declare an interim dividend of ZAR 0.81 per share.
This is in line with our normal 3x dividend cover policy and below are just the relevant dates for the dividend payments. I will now hand you over to Dirk Lourens to take you through the operational overview.
Thank you, Sam. As usual, I will start off with an outlay of our different divisions. In the prior year, the group reported four operating segments, being materials handling and mining, construction materials, roads and earthworks, and infrastructure. Since the start of this financial year, management decided to align the group's reporting structure with the way that operations are managed. The most significant change is that management decided to manage and report Australia as a separate fifth division, having previously formed part of the infrastructure division. Another change is OMV Group of Companies that includes Attaclay will be managed and reported under the construction materials division. Previously, they were reported under the mining and materials handling division. During the year, the group also concluded three acquisitions successfully as part of our diversified value offering strategy.
In Australia, we acquired Axis Mineral Services, a respected leader in crushing, screening, and mining services in Australia. In the infrastructure division, we completed the acquisition of Hlumisa Engineering Services. They specialize in mechanical and electrical works with a strong focus on water treatment and wastewater treatment plants. They bring a wealth of experience that perfectly complements our infrastructure capabilities. Raubex also successfully concluded the addition of Mowcop, a Silica Quarry focusing on the provision of silica sand in the glass manufacturing industry, leisure market, and other metallurgical industry. We start off with the materials handling and mining division. Take note that all numbers have been adjusted to exclude the OMV Group. The division comprises four main disciplines, namely contract crushing, materials handling, and mineral processing services for the mining industry, contract mining, and specialized resource ownership through investment in Bauba Resources.
Revenue for the division decreased by 24.4% to ZAR 1.79 billion from ZAR 2.37 billion. Operating profit decreased by 50.2% to ZAR 87.7 million from ZAR 176 million. The operating profit margin also decreased from 7.4% in the previous period to 4.9%. Capital expenditure of ZAR 226 million compared to a previous ZAR 336.4 million. The secured order book of ZAR 4.54 billion increased from ZAR 3.35 billion in the previous period. B&E International delivered a solid performance during the first half of the year, supported by several startup contracts that are expected to gain traction in the second half. Our flagship Namdeb contract experienced a slowdown during the first half of the financial year due to the declining diamond price. However, the good news is that the curtailment will be lifted in December, and the contract has been extended with an additional 40 million tons up to December 2028.
There has been a positive increase in SANRAL-related contract crushing, reflecting renewed progress in the infrastructure initiatives. Their renewed focus on manganese and iron ore processing has yielded successful contracts in this market. In Mozambique, while the force majeure restrictions remained in place during the review period, operations restarted in the latter part of the first half, which benefited regional performance. The force majeure restrictions have been lifted since. SPH Kundalila delivered sound performance in the first half of the year, showcasing resilience and effective execution in a demanding environment. Its operations at the Kookfontein Mine continue to perform well by supplying yellow equipment on a rental basis to the mining contractor. The Saldanha contract is ongoing with a longer strategic view on possible partnerships with private port and rail operators. A slowdown in tender activity in the material handling business impacted performance during the first six months.
Bauba's performance remained constrained during the reporting period, notwithstanding a 15.4% increase in the chrome price. The results were further negatively impacted by the strengthening of the rand against the U.S. dollar. In the first half of the financial year at Kookfontein, we encountered a predicted geological fault that had to be mined through. This resulted in a decrease in feed grade to the processing plant. Consequently, yield percentages declined, leading to a decrease in concentrate production volume. The net effect of this was an increase in both mining and production costs. Additionally, the PGM plant was successfully commissioned, with the first full month of production recorded in August this year. The commencement of PGM sales is anticipated during the second half of the financial year. The new underground contractor at Moeijelijk Mine commenced operations in April this year and has been performing in line with production plans.
During the initial startup phase in the first half of the year, material was sourced externally to maintain plant throughput. However, the frequent changes in feed material negatively affected the plant's performance, resulting in lower yield percentages and an increase in production costs. The contractor is expected to reach full underground production capacity in the second half of this year. This development will improve output and support an increase in the production of foundry grade chrome, which commands a premium price in the market. Bauba's revenue decreased by 40% to ZAR 934.5 million from ZAR 1.53 billion. Profit decreased with 106.6% from an operating profit of ZAR 114.8 million to an operating loss of ZAR 7.6 million, based on lower volumes at both the Kookfontein and Moeijelijk Mines.
However, we cannot just look at these numbers in isolation without taking into consideration that we are coming from a very low base and operating loss of ZAR 350.5 million at full year 2025. Operating profit margin weakened to a loss margin of 0.8% from a + 7.5% in the prior period. EBITDA decreased to ZAR 58.3 million, down by 70% from a +ZAR 191 million in the previous period. The average rand to US dollar exchange rate strengthened with 2.1% over this period. The met grade price CIF China varied between a minimum of $233.8 to a maximum of $287.05 per ton. Total production decreased by 30.7% to 725,900 tons from 1.05 million tons in the previous period. The run of mine tons sold decreased further by 75%, down from 40,000 tons to only 10,000 tons in this period.
Total tons concentrate sold decreased by 30.5% from 421,700 tons - 293,000 tons. Capital expenditure decreased by 43.8% from ZAR 284 million to only ZAR 160 million . Moeijelijk mine revenue decreased by 46.8% to ZAR 282.8 million from ZAR 531.4 million. Operating loss decreased 55.2% from a loss of ZAR 43.4 million to a loss of only ZAR 19.4 million in this period. Operating loss margin strengthened from a - 8.2% to a negative margin of 6.9% in this period. EBITDA increased to ZAR 1 million, up by 114% from a -ZAR 6.8 million in the previous period. Capital expenditure decreased by 34.6% from ZAR 25 million in the previous period to only ZAR 16.3 million in this period. Total production decreased by 55% to 80,600 tons from 178,800 tons in the previous period. Total tons concentrate sold decreased by 45% from 118,800 tons - 65,300 tons.
Kookfontein Mine revenue decreased by 34.6% to ZAR 651.7 million from ZAR 997 million in the previous period. Operating profit decreased with 88.3% to ZAR 18.2 million from ZAR 154.8 million in the previous period. Operating profit margin weakened to 2.8% from 15.5% in the prior period. EBITDA decreased to ZAR 60.2 million, down by 69% from ZAR 193.7 million in the previous period. Capital expenditure decreased by 50%, down from ZAR 259 million in the previous period to only ZAR 129.6 million. Total production decreased by 25.7% to 648,400 tons from 868,800 tons in the previous period. The run of mine tons sold decreased further by 75%, down from 40,000 tons to only 10,000 tons. Total tons concentrate sold decreased by 24.8% from 302,800 tons to 227,800 tons. Next up, we look at the construction materials division. Please note that all the numbers have been adjusted to include OMV Group's numbers.
The construction materials division specializes in the supply of aggregates from commercial quarries, ready-mix concrete, and industrial minerals, as well as our asphalt and bitumen supply. Revenue increased slightly to ZAR 1.75 billion from ZAR 1.73 billion in the previous period. Operating profit for the division decreased by 16% to ZAR 142.4 million from ZAR 169.2 million in the prior period. The operating profit margin also decreased to 8% from 9.7% previously. Capital expenditure were almost similar as the previous period at ZAR 123 million. ZAR 44 million of the CapEx spent was for the new crushing circuit we implemented at Rossway Quarry. The secured order book has increased from ZAR 2.13 billion -ZAR 3.14 billion. The aggregates business experienced lower than anticipated volumes during the first quarter of the financial year, primarily due to adverse weather conditions. These disruptions affected production processes, resulted in temporary site closures, and caused delays in achieving base load volumes nationwide.
In the southern region, the aggregates market experienced challenges in profitability. Even though sales volumes remain satisfactory, the decline in margins was primarily due to rising input costs and persistent production limitations. While our balance sales did not meet the expected sales volumes, we are confident that the volumes will pick up during the second half of the year. Encouraging developments includes the entry of new brick-and-block manufacturers into the Eastern Cape market, which will bolster our base load volumes. Furthermore, the recently commissioned plant upgrades in Gauteng are delivering better than expected production returns and are assisting with our strong performance, enhancing both output and operational efficiencies. Our Botswana operations have commenced the financial year on a strong footing. Bela-Bela Quarry continues to perform exceptionally well, reinforcing our operational resilience and solidifying our market presence in the market.
The Competition Commission approved the acquisition of Mowcop Silica quarry and operational control transfer to Raumix in August this year. This marks Raumix's N3 into the silica market and represents a strategic opportunity with considerable growth potential for the aggregates market. Nonetheless, the outlook for the remainder of the financial year is optimistic, with early indicators pointing to the recovery and potential improvement in market conditions. National Asphalt started the financial year with a relatively slow secured order book and production delays due to excessive rain. However, recent contract awards in the roads market have significantly strengthened the pipeline, and the strong performance is anticipated for the remainder of the year. Completing the major N3 projects in KwaZulu-Natal during this reporting period represents an important achievement following the restructuring of the business. Tender activity continues to be strong, driven by increased infrastructure investment in roads projects.
National Asphalt has sufficient capacity to support the industry. This momentum is expected to drive steady revenue and profitability in the medium to long term. Natref ceased bitumen production in September this year, with the last bitumen sold at the end of October. As from 1st November 2025, all the bitumen used in South Africa will be imported. Tosas have sufficient bitumen storage facilities as well as supply agreements in place to continuously service the market without interruption. Tosas delivered a strong performance during the first six months of the financial year. The industrial mineral sector has been significantly impacted by ongoing uncertainty surrounding the future of ferrochrome smelters in South Africa. As a result, bentonite sales have declined sharply during the reporting period. The agriculture sector, one of the largest markets for gypsum, is expected to perform strong this year, driven by favorable seasonal rains.
The cement market is also showing promising signs of increased activity towards the latter part of the first half, supported by government infrastructure initiatives. These developments are a good sign for the future growth of OMV's gypsum operations. Additionally, the acquisition of a significant gypsum stockpile during the reporting period has proven highly beneficial. Sales from the acquired stock exceeded expectations in the first half, providing a boost to performance and reinforcing the strategic value of this transaction. The aggregates and ready-mix operations experienced a tough first six months. However, good growth is expected for the remainder of the year. The roads and earthworks division specializes in delivering comprehensive road construction, bulk earthworks, and mining infrastructure, like all roads and tailing storage facilities. Roadmac specializes in road surfacing and rehab projects.
Revenue in the roads and earthworks division increased by 2.3% to ZAR 3.56 billion from ZAR 3.48 billion in the previous period. Operating profit increased by 11.8% to ZAR 287.6 million from ZAR 257.2 million. Operating profit margin increased to 8.1% from 7.4%, exceeding our target range of between 6% and 7% for this division. The primary reason for these increases was the emphasis on the effective execution of our order book. Capital expenditure increases to ZAR 121 million from ZAR 89.8 million. The secured order book increased from ZAR 13.61 billion -ZAR 14.61 billion. There was a positive increase in the awarding of new SANRAL tenders during the reporting period. Notably, the group has been awarded significant road contracts during the first half of the year. The upgrade of the N2 between Bloemendal and Piet Retief, valued at ZAR 3.22 billion, awarded from SANRAL.
The N2 between Verzameling and Leiden was ZAR 2.36 billion, also awarded by SANRAL. The upgrade of the N4 between Zeerust and Botswana border to the value of ZAR 324 million for Bakwena. The N1 between Pumulani Interchange and Pumulani Mainline Plaza at ZAR 276 million, also for Bakwena. They have also received several smaller contracts to the value of ZAR 500 million. These new projects effectively replace completed work along the KwaZulu-Natal corridor on the N2 and N3, ensuring continuity in the division's road construction pipeline. The Senqu River Bridge JV project in Lesotho is still progressing exceptionally well. The construction of the bridge will be completed by the end of this financial year. The numbers have been restated of the infrastructure division to now exclude the Australian operations.
The infrastructure division specializes in disciplines outside of the road construction sector, including energy, with a specific focus on renewable energy and battery storage facilities. Facilities management, telecommunications, housing infrastructure projects, commercial building refurbishment, and construction all make up of the business that the infrastructure division provides. Revenue increased by 49% to ZAR 2.149 billion from ZAR 1.44 billion in the previous period. The operating profit increased by 110.6% to ZAR 180 million from ZAR 85.5 million. The operating profit margin strengthened to 8.4% from 5.9% in the previous period. The performance was mainly attributable to new contracts secured in South Africa, especially in the renewable energy sector. Capital expenditure of ZAR 40.6 million is down from ZAR 96.8 million in the comparison period. The secured order book decreased by 18.1% to ZAR 6.07 billion from ZAR 7.41 billion as of February 2025.
Our private renewable energy projects in the wind and solar space continue to perform well due to excellent execution. With the strong market momentum, we are well positioned to continue to capitalize on the current upswing in the renewable energy sector. Our other flagship project in the building sector, the repair and upgrade of the Parliament building in Cape Town, is progressing very well and remains firmly on track. The design and construction of the mechanical and electrical works for the upgrade and expansion of the Potsdam wastewater treatment plant remains on schedule and one of our flagship projects. The division's affordable housing projects continue to show strong progress, supported by renewed momentum in the property market driven by interest rate cuts. Sales in the Newinbosch development are outperforming our expectations, reflecting growing market confidence.
With a noticeable uptick in property activity, the outlook for this year remains positive. Raubex has also been awarded preferred bidder status for the Lebombo Border Post project for the complete overhaul and rebuild of one of South Africa's busiest border posts. To support our strategic objectives and diversify our income streams, we acquired Hlumisa Engineering Services effective 1 September 2025. Hlumisa specializes in mechanical and electrical engineering, with a strong emphasis on water and wastewater treatment. This capability aligns seamlessly with our focus on the infrastructure and environmental services sector. The Australian operations specialized in road construction, earthworks, and civil construction for landfill construction and capping. With a strong focus on road surfacing and rehabilitation, in addition to their expertise, the division is also actively involved in renewable energy projects, particularly the development of wind farms and battery energy storage systems.
The revenue decreased by 17.8% to ZAR 1.58 billion from ZAR 1.92 billion in the previous period. Operating profit decreased by 160% to an operating loss of ZAR 94.8 million from an operating profit of ZAR 158.3 million. The operating profit margin decreased to an operating loss margin of 6% from an operating profit margin of 8.2%. The secured order book increased by 24.7% to ZAR 2.09 billion from ZAR 1.74 billion at February 25. CapEx is down from ZAR 117.5 million in the previous period to ZAR 70.5 million. Operations in Western Australia experienced a mixed year marked by both challenges and encouraging developments across the division. Raubex Construction Australia undertook a roadworks project for a major mining company in the first half of the year. They present considerable challenges due to multiple contributing factors, including heavy rains, material difficulties, and production constraints.
This contract was terminated at the end of September, and all anticipated losses were recognized in the first half of the year. The commercial closeout and finalization of the final account and claims is expected to be concluded before the end of this financial year. This project is the primary contributor to the division's underperformance. The remainder of Raubex Construction Australia's projects are all within budget and performing well, and we believe that this is an isolated incident. Roadmac Australia continues to expand its market share, and they have started delivering profitable projects, strengthening its position as a key player in the road surfacing sector. In Westforce Construction, a multidisciplinary civil contractor specializing in wind farm development and civil works across the energy infrastructure and resource sectors delivered an exceptional performance in the first half of the year, exceeding their budget.
While the current order book is not yet full, they remain confident in their ability to secure new opportunities during the second half of the year. In line with its strategy, the group expanded its value offering capabilities in Australia with the acquisition of a 67% interest in Axis Mineral Services, effective 1st August 2025. Axis is a contract crushing business, which will be complementary to the other businesses within this division. In closing, the group's performance in the first half of the year reflects both resilience and adaptability in the face of a challenging market. Despite the headwinds in certain divisions, our focus on strategic acquisitions, disciplined execution, and diversified portfolio strengthened our position in the market. The expansion into new markets and the successful integration of new businesses underscore our commitment to innovation and operational excellence.
With a robust order book and positive momentum in key sectors such as infrastructure, roads, and renewable energy, we are well placed to capitalize on emerging opportunities and deliver sustainable value to our stakeholders. I will now hand you over back to Felicia for the outlook and strategy section.
Thank you, Dirk. We've now reviewed our financial and operational performance for the period. Let's turn our attention to the outlook and the strategy that will guide us forward. Order book, as I mentioned earlier on, we have reached a record order book of just above ZAR 30 billion, which is up from ZAR 28.18 billion at the end of the previous financial year. This 8% increase demonstrates strong demand for our services and successful tender activity across divisions. What's encouraging about this order book is that it spreads over the next coming years.
When you look at for financial year 2026, we have a secured order book of almost ZAR 10 billion. For financial year 2027, almost ZAR 10 billion. And 2028, about ZAR 5 billion. And beyond FY 2028, about ZAR 4 billion. So our order book is diversified across a range of customers and sectors, including private clients, federal concessionaires, provincial and municipal governments, other parastatals, Australia, and the rest of Africa. When we look at the timeline per customer from the order book side, this graph indicates how our order book is spread over multiple years, as I've indicated earlier on, providing excellent revenue visibility. We continue growing our private sector and international order book.
Private has an order book of ZAR 8.6 billion, followed by SANRAL with ZAR 8.54 billion, international ZAR 5 billion, concessionaires at ZAR 4 billion, provincial at ZAR 1.8 billion, other parastatals ZAR 1.87 billion, and lastly, municipal at ZAR 426 million. As indicated earlier, you can see our order book comfortably spreads beyond 2028 for the majority of our clients. Looking at order book history, this slide provides a historical perspective on our order book, showing how our order book has evolved across different customer segments over the past seven years. The private sector order book has shown strong growth, reaching ZAR 8.59 billion. SANRAL order book has remained consistent over the past six years, with the order book growing to ZAR 8.54 billion. Concessionaires, provincial, municipal, and other parastatal clients all contribute to a diversified order book, helping to spread risk and opportunity.
International work, including Australia and the rest of Africa, continues to be a significant contributor, with Australia at ZAR 2 billion and the rest of Africa at ZAR 3 billion. From FY 2023, we began reporting the concessionaires' order book value separately, which allows for more granular tracking of our client base. This diversification of our order book reduces reliance on any single client or sector and positions us well for future growth and resilience and to be selective when tendering. With this historical context, we can see how our strategic focus on diversification and client segmentation has paid off. Moving on, this slide demonstrates the order book customer per division. Roads Authorities Division continues to secure the largest share of SANRAL concessionaires and provincial contracts, reflecting our strong reputation and expertise in the sectors.
The infrastructure division has a significant presence in private and other parastatals, highlighting our capabilities in complex, large-scale, and infrastructure projects. The construction materials division serves a mix of municipal, provincial, and private clients, demonstrating its adaptability and market reach. The materials handling and mining division and the Australia division both contribute meaningfully to the international and private client segments by supporting our global growth ambitions. Segmental analysis. Our operating divisions. Currently, the order book is at 48% compared to 49% at year-end. Materials handling mining division, 15% versus 13% at year-end. Construction materials division, 10% versus 6% at FY 2025. Lastly, Australia, 7% compared to 6% at FY 2025. Moving on to sustainability and ESG, we have achieved a Standard & Poor's global corporate assessment rating of 40 out of 100, a significant improvement from 29 out of 100 in 2024.
This improvement highlights the tangible progress we are making in our ESG journey and our responsiveness to stakeholder expectations. Raubex was a silver sponsor at the Sustainability and ESG Africa Conference and Expo. Our participation demonstrates our industry commitment and also engagement on critical ESG topics. We are also expanding our ESG reporting scope to include Scope 3 emissions from FY 2026. Looking at our communities, one of our proudest community achievements is the upgrade of Comforter's Crèche. They are based in Ga-Rankuwa, north of Pretoria. The facility was transformed from initially shacks to containers and now into a modern center with six classrooms, a hall, kitchen, and bathrooms. This upgrade provides a safe, loving space for children to learn, grow, and to thrive. We have contributed ZAR 1.7 million to this project, demonstrating our commitment to investing in early childhood development and education.
This facility was officially opened on 21 August 2025, marking a significant milestone for both the community and Raubex. I would like to share some of the achievements that we have received during this reporting period. Raubex Building has secured second place for the Akeso Mental Facility in Polokwane. They've also achieved third place for Power Park Student Housing, phases 2 and 3. They have also secured an international recognition for Newinbosch. This development has earned three international property awards, including Best Sustainable Development, Best Residential Development, and a new for this year, Best Mixed-Use Development in South Africa. We are very proud of the work undertaken by Raubex Building. Next, looking at our safety performance, most of our subsidiary companies achieved a 45% reduction in lost-time injury, LTI. This improvement reflects our strong commitment to safety and the effectiveness of our safety initiatives.
We'll continue prioritizing the well-being of our people and the communities we operate in. As we near conclusion of this presentation, I would like to take you through our core message, which has remained consistent and focused on sustainable growth, operational excellence, and resilience. We expect strong results across all divisions in the second half of 2026, which will be supported by a quality order book and a diversified business model that spreads the risks and opportunities. Our continued performance in Western Australia demonstrates our ability to compete and succeed in international markets. Raubex's legacy of more than 50 years in building tomorrow is a testament to our commitment, expertise, and reliability. Our core message remains consistent. We are focused on delivering value to our shareholders, maintaining operational excellence, and driving growth through strategic initiatives. At a very high level, we continue progressing with the implementation of our five-year strategy.
We've made good progress in terms of growth. We are also growing our market share in the renewable sector, as Dirk has mentioned earlier on, both locally and internationally. We are looking after our best asset, our people, ensuring their wellness and safety. Let's now look at the outlook. The group maintains a more positive outlook for the remainder of financial year 2026, driven by encouraging opportunities within each division and a solid order book. Our growth strategy continues to be underpinned by our diversified business model, which allows us to manage the risk and capitalize on opportunities across various sectors. We are supported by a committed workforce, strong leadership, and a healthy balance sheet, all of which position us well for future growth. Let's review the outlook for each division, starting with the materials handling and mining division. It's positive about the outlook for FY 2026 and beyond.
While Bauba has faced operational challenges during this period, the stability of the chrome price and improvement in operations bode well for the group. B&E International and SPH Kundalila will continue to explore various growth opportunities. The outlook for the construction materials division is positive for the remainder of the year, bolstered by the various acquisitions undertaken. Increased activity in the roads construction industry bodes well for the aggregates, asphalt, and bitumen businesses. Transnet is actively advancing its transformation agenda, which is positive for our sector. The roads and earthworks division is expected to deliver a solid performance for FY 2026, supported by recent SANRAL awards. The division has a good potential pipeline of work, especially from 2026 onwards. As we continue, the outlook for the infrastructure division remains positive, with numerous opportunities emerging in PPPs, other infrastructure projects, commercial and affordable housing, and renewable energy.
Our focus on these sectors positions us well to capitalize on market trends and deliver sustainable growth. The Australia division is expected to improve its performance in the second half of 2026, with the losses fully accounted for in the first half of 2026. Our strategy and profile in Australia remain unchanged, and we have further strengthened our risk management systems and due diligence processes. The division's outlook remains positive. We will pursue opportunities in line with our strategy, including infrastructure projects. We are also considering acquisitions that align with our growth strategy and will maintain strong relationships with Main Roads in Western Australia and other clients. With these divisional strategies, Raubex is well placed to unlock further value and maintain its growth trajectory. Next, we will address any questions you may have. Thank you, ladies and gentlemen.
Thank you very much, Felicia. Our first question we received is from John- Brad Petersen from Ngombe Wealth. When you say that Australia will return to profitability in H2, do you mean Australia will be profitable in the second half or also profitable for the full year?
Yes, John. The operations will return to profitability in H2, and we should make up most, or if not all, the losses of H1. So the aim is to get to a break-even, and that is excluding any claims that might come through from the loss-making project. At this point in time, we don't know what the value of that claim is. We're still in negotiations, but that should be returned to break-even without any claims included in the numbers.
Thank you, Sam. Our next question is from Anette Malherbe from Absa. Can you please confirm your largest competitors for 2025?
Yes, Anette. So our biggest competitor would be WBHO, but just remember that we are diversified, so our businesses are not the same.
Thank you very much, Felicia. Then we have a whole list of questions covering Bauba's operations and strategic direction. So I'm not going to read all of them separately. There's a lot of duplicate questions. Our team is going to try and address them all at one time.
Thank you, Grace. From a strategy point of view, so management is currently evaluating the long-term strategic direction of Bauba, and part of that is we plan to exit the underground mine. That is Moeijelijk, like we mentioned previously. We also need to sort out the production inefficiencies currently that we have experienced at Moeijelijk and Kookfontein. But I must emphasize that when you look at Bauba's performance for the first half of 2026 compared to the second half of 2025, the performance has improved drastically. And we also plan to delay the startup of Naboom Mine up until we have resolved the production inefficiencies.
Maybe just from my side, if I can look at the two individual mines, if we start off with Kookfontein, there were quite a few questions on productions. So as Felicia mentioned, the chrome price last year, first six months, was quite high. So we're coming off quite a high base. So we're quite pleased with the turnaround we've already made up to this point in time at Bauba. Like Felicia mentioned, we had a bad end of last year. And if you compare to where the price was in H1 of last year versus H1 of this year, that increased price of last year already, that alone is a 10% margin effect. And then this year was also quite heavily impacted by rain, especially in March and April. And because of the geology, we were mining in a lower-grade area, which also impacted the cost of production.
But on the upside is our PGM plant we've commissioned in July. And then we spoke about the turnaround for Kookfontein. So I think, first of all, we passed the low-grade seams that we've mined at the beginning of the six months. So we were mining at 25.6% grades, and we're back to 27% back to the mine plan. So that should result in improved results for H2, and we're there already. And then there's also optimized plant performance that we are looking at. Targeted upgrades, the wash plant, we've made some improvements there. And also, we've put in a third horizontal shaft impactor that should also increase production. So the priority is to remain strong throughputs and also to focus on our recoveries. And our PGM plant, that one was commissioned, as I said, in the first six months.
We already sit with about 1,800 ounces of PGMs, final product that we can sell. We're just finalizing those agreements. And then going forward, we should, as we indicated before, look at about 1,500 ounces per month that we will look at. At current prices, I think the credit we're getting is, I think we're getting about 75%, 75% of the PGM price. And at those levels, we should make very good margins. Our cost is around ZAR 500 a ton, and the throughput is about 30,000 tons for the PGM plant. So there's good prospects there. And then just on the productions as well, because of the price that's increased towards the end of last year, we reduced productions. And the first six months of this year was ramping up those productions again.
So we are back at full production, and the target is about 80,000 tons-90,000 tons throughput that we want to do per month. And we're looking at 46%-48% yields. And it's looking very good at this point in time at Kookfontein, and that's why we expect quite an improvement in H2. If we then move over to Moeijelijk Mine, there was quite a delay in the production because the underground miner, the previous one, was put off site in January of last year. It did not follow the mine plan. So we appointed a new underground contractor with new and better terms, which should have a big impact on our costs. And that underground miner is still, we only started in April, so we're still upping production. And for the second half of this year, we also expect a turnaround there at Moeijelijk Mine as well.
So the result was that we had to buy in quite a lot of product in the first half, and the yields there were not where we wanted to be. So I think there's already a good progress and turnaround at Moeijelijk Mine as well. And then on both mines, I think important to note is that the Eskom lines, we should turn around and move to Eskom Power at Moeijelijk and Kookfontein. And at Kookfontein, that should have about a ZAR 3 million per month improvement, and at Moeijelijk, almost ZAR 6 million per month. So that's also good prospects, and that should come online early in next year. I think there was a question on EBIT as well. I think currently, the EBIT is at 6%. Guidance was 7%-8%.
But I think with the turnaround and where we are currently, we believe that we should start making good margins at both mines, especially next year. But it's definitely a very big improvement from H1 to H2. And then just quickly, the productions, I think there was a production question on Moeijelijk as well. So we target there 40,000 tons of feed per month.
Thank you very much, Sam. Our next question is from Lebohang Mofokeng from Truffle Asset Management. Can you provide some color on order wins post-reporting and any expected imminent awards?
Thank you, Lebo. Yes. We are actually very much looking forward to the second half with regards to awards that we've received. Currently, we're still awaiting about ZAR 6.5 billion awards to come still through from SANRAL. We await some awards that we've tenders that we've submitted to the concessionaires. As you would recall, we've mentioned it a few times. They are busy with an upgrade program that they need to hand over the concessionaire contracts towards SANRAL within the next three to four years. We're also very excited with regards to the private power producers. We are in line for about ZAR 3.5 billion rands' worth of awards towards wind, solar, as well as battery energy storage systems. We are in the final stages of finalizing the contractual agreements with the clients. That should also take off within the next two to three months.
In Australia, we've managed to secure some new projects to the value of about ZAR 500 million, which will definitely be a bit better margins and more secured work with regards to what we used to, so not high-risk work. So that will definitely assist in getting Australia back to profits within the next six months. If we look at our aggregates and material side, we also anticipate to benefit in these coming six months from on the rail side, from Transnet. It was a bit quiet in the first half, but there's good prospects on that side. And we then also see an increase in the materials, specifically with regards to the Gauteng area, where there's an uptick in building work due to the decrease in interest rates. So yes, we are very much awaiting a few awards, and we did receive.
The future looks good for the second half.
Thank you very much, Dirk. Our next question is from Wessel Joubert from Oyster Catcher Investments. I think the Bauba part has already been covered. Then the second question he asks is, are there any potential future liabilities that can come from the cancelled Australian contract? And that you mentioned meaningful tenders in Australia. What gives you confidence that you will not have similar difficulties to the cancelled contract?
Thank you, Grace. Wessel. Yes. So remember, we've been in Western Australia for the past eight years, and we've always been cautious in terms of tendering and executing. We continue to execute smaller contracts. We operate as a Tier III company in Western Australia. And I mean, your question about future liabilities, we don't believe there will be any future liabilities. We have fully accounted for the losses in the first half of this financial year. What we have done beyond this is we have further strengthened our risk management and due diligence processes. And as we said earlier on, this loss-making contract is isolated. The rest of the contracts within Raubex Construction Australia, they're performing well. And the rest of our subsidiary companies, that is Westforce Construction, Axis Mineral Services, and also Roadmac, they're actually performing well.
We're quite confident that with the mitigation that we've put in place, we've actually managed this risk. Thanks, Grace.
Thank you very much, Felicia. That seems to be all the questions. Thank you very much.