NRW Holdings Grabs $137 million Contract from Rio Tinto

On May 17, 2019, NRW Holdings Limited (ASX: NWH) announced that it had bagged the Koodaideri Rail Formation South Earthworks contract from mining major Rio Tinto Limited (ASX: RIO). The scope of the project includes the construction of around 73 kilometre of new rail embankment, associated road works and a new mine access road along the alignment of the Koodaideri rail system. The project value is in excess of $137 million and the project is anticipated to take around seventy weeks to complete post the site work commencing in August this year. It is likely that at the project’s peak work, there will be a requirement of over 300 site-based personnel.

Jules Pemberton, NWH’s Chief Executive Officer, stated that they are excited with the Koodaideri contract from Rio Tinto. They have been working on civil construction projects in the Pilbara for quite long now and have successfully delivered various Brownfield and Greenfield projects for Rio Tinto since the year 2002. Since then, the company has also constructed more than 900 km of rail formation across the Pilbara, provided work to thousands of Australians as well as supported local industries, suppliers and traditional landowners.

On May 8, 2019, NRW Holdings Limited became a substantial holder to the company Gascoyne Resources Limited with a voting power of 8.58%.

In another update, Trade Me Group Limited (XASX: TME) was replaced by NRW Holdings from the S&P/ASX 200 effective from May 3, 2019. It was due to the result of the scheme of arrangement, where Titan AcquisitionCo New Zealand Limited had acquired Trade Me Group Limited.

Golding Contractors Pty Ltd, a wholly owned subsidiary of NRW Holdings, had received a Letter of Direction to increase Mining Plant at the Curragh Main Mine, from Coronado Curragh Pty Ltd through the introduction of the fourth fleet to the existing mining operations.

In its H1 FY19 results, NRW reported an increase in its revenue by 50.9% pcp to $521.1 million. Its EBITDA increased from $40.3 million in H1 FY18 to $74.3 million in H1 FY19. Its EBIT more than doubled for the period to $50.0 million in H1 FY19 as compared to $22.5 million in H1 FY18. The company’s net earnings increased to $28.2 million compared to $15.3 million in the pcp. Its order intake in the six months was reported at ~$1.0 billion, which increased the total work in hand to $2.4 billion.

On the stock information front, at the time of writing (on May 20, 2019, AEST 1:00 PM), the stock of NRW Holdings was trading at $2.925, up 0.515%, with a market capitalisation of ~$1.09 billion. Its current PE multiple stands at 19.53x, and its last EPS was noted at $0.149. Its annual dividend yield has been noted at 1.37%. Today, it touched day’s high at $2.955 and day’s low at $2.750, with a daily volume of 2,277,298. Its 52 weeks high was at $3.020 and 52 weeks low at $1.237, with an average volume of 2,171,203 (yearly). Its absolute returns for the past one year, six months, and three months are 123.85%, 59.89%, and 39.90%, respectively.


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