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Saunders International (ASX:SND) Keeps Up The Good Work, Flaunts New Project Wins

Summary

  • Saunders International Limited (ASX:SND) is a multidisciplined engineering and construction company.
  • In the financial year 2020, the Company returned to profitability, with revenue and profits registered from the expanded range of services offered.
  • Outlook for the new projects for the Company is positive.

Saunders International Limited (ASX:SND) is recognised for its diversity and strengthening market position across different sectors. Since its establishment in 1951, the Company has been actively supporting the development of Australian industries.

The Company’s five-year strategy set in 2020, was built on three pillars - FIX, GROW and ACQUIRE. While the FIX phase is now complete, Saunders continues to be on the sustainable GROW phase. “The business is now in a position to enter the ACQUIRE phase”, says Managing Director Mark Benson.

FY20 Results (Source: SND ASX Presentation, October 2020)

 

During FY20, Saunders was awarded a record value of new contracts, allowing the Company to kickstart FY21 with an order book of $110 million. This order book comprises significant contracts for customers across a diverse range of sectors including road, rail, defence, water, mineral processing, and oil & gas.

GOOD READ: After an upbeat FY20, will Saunders continue the happy journey in FY21?

In this backdrop, let us cast an eye on Saunders’ latest project wins in FY21. 

Laing O’Rourke In Defence Sector

In September 2020, Saunders secured a new project for Laing O’Rourke in the defence sector. The contract is deemed to be a significant win for the Company’s defence sector strategy. It depicts Saunders’ ability to deliver multidisciplined services via its renewed operating model.

Besides, the project adds to the Company’s presence in Darwin with its current contract with the NOVA NACAP JV.

  • The contract is valued at ~$26 million and the project is located at the Larrakeyah Defence site in Darwin.
  • Saunders will construct two tanks, instal fuel systems and pump facilities, and provide electrical and instrumentation services across the site.

The Company has already begun the design works and expects to be on site in Q2 2021 with revenue continuing through to FY23.

Other Contracts

Continuing the project winning momentum in FY21, Saunders has added a further $10 million of contract wins, spread across the group.

Besides, Saunders is the preferred contractor for a further four opportunities in the civil and defence sectors that have a combined value of $5.5 million.

Ongoing Works

Saunders is currently engaged below mentioned projects-

  • The 84m diameter reservoir project for Sydney Water is progressing as per schedule.
  • The Vopak project at Botany to build 3 x 35 megalitre tanks is also progressing well. It is approximately 50% complete with completion forecast in Q4 FY21.
  • The Garden Island project is expected to be completed in FY21.
  • The Sydney metro project will be wrapped up by the end of FY21.
  • Saunders was awarded three bridges for the MidCoast Council that are in the construction phase and will be completed in Q3 2021.
  • The major tank maintenance package for BP at Bulwer Island is progressing well. This project will continue until Q2 FY22.

SND traded at $0.59 on 2 December 2020.

ALSO READ: Principal Drivers Behind Saunders International’s Solid Growth Outlook

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