Western Australia-based Civmec has reported a positive start for the FY2020 with revenue of $82.1 million and a net profit of $3.8 million, supported by the long-term delivery of the Arafura Class offshore patrol vessels.
Civmec has commenced FY2020 with a substantial increase in financial performance, delivering $3.8 million net profit for the September quarter and a positive future growth outlook.
The result represents a substantial increase in net profit after tax (NPAT) margin, up to 4.6 per cent from revenue of $82.1 million for the period. Revenue increased by 11.9 per cent on the previous quarter (Q4 FY2019: $73.4 million).
With a current order book of $816 million and the ramping up of recently secured projects – including playing a significant role in the delivery of Australia’s largest lithium hydroxide plant being constructed in the south-west of WA for Albemarle – the group is well positioned for FY2020.
The group said it remains committed to delivering its strategy of capitalising on major expansion project opportunities with key clients and further establishing consistent, recurring revenue streams.
Civmec chief executive Patrick Tallon explained, "It is pleasing to deliver such a strong financial result for the quarter. Our focus is on securing projects that utilise a combination of our facilities and on-site multi-disciplined, self-performance capability, enabling us to provide clients with a single, vertically integrated solution."
Shifting to the company's defence portfolio, Civmec is banking on long-term growth as a result of the SEA 1180 Arafura Class offshore patrol vessel program.
While the processing of steel for the first two vessels being constructed in South Australia under the Royal Australian Navy’s OPV program is well underway at Henderson, revenue generated from these works will increase once the consolidation of the remaining 10 vessels moves to Civmec’s new state-of-the-art facility in 2020, providing a sustained revenue stream until 2029.
Furthermore, the federal government’s commitment to undertake its minor naval vessel continuous build program and significant sustainment activities at Henderson will provide further construction and through-life support opportunities in the marine and defence sector going forward.
The group has recently expanded its executive team to support future growth, with the appointment of two new executive general manager roles for manufacturing and maintenance, sitting alongside the existing executive general manager construction role.
This will facilitate the focused management of the group’s three functional areas of operation, providing multi-disciplined capability across its four operating sectors.
"The intent of these structural changes is to support our strategic growth plan, enabling the focused delivery of major projects to drive profitability; streamlining east and west coast operations to deliver efficiency and maximise synergies in production; and leveraging our national footprint and multidisciplinary capability to capitalise on the growing maintenance and turnaround services market," Tallon added.
Civmec is an integrated, multi-disciplinary construction and engineering services provider to the oil and gas, metals and minerals, infrastructure, and marineand defence sectors. Headquartered in Henderson, Western Australia, Civmec has regional offices in Newcastle (NSW) and Gladstone (Queensland).
The company is listed on the SGX (Singapore) and the ASX (Australia).