Mining
The Mining segment has secured over 95% of its expected revenue for the second half of the financial year with strong visibility of revenue and earnings for future years.
Subject to any further impact from abnormal levels of rainfall in Queensland, mining margins are expected to return to historical long-term percentages during the second half. Additionally, to the extent that the actual future cash flows recovered in relation to the amounts due from OneSteel do not at least equal their carrying values, these financial assets would be required to be written down to their recoverable amount through profit or loss.
With work in hand of $4.9 billion and current active tenders totalling circa $3.4 billion, the Mining segment is in a strong position to continue to grow a stable revenue base and maintain a disciplined approach to target numerous opportunities in the pipeline that will enhance returns on capital.
Minerals, Energy & Technologies
The MET segment is well diversified across iron ore, gold, rare earths and battery critical minerals. The majority of revenue in this period was earned from iron ore and gold. Diversification beyond current core markets in mining and minerals processing in Western Australia will present additional opportunities for MET. Queensland represents considerable growth opportunities as well as diversifying into the energy sector.
The delivery of Northern Star's KCGM Fimiston Growth Project by Primero continues to demonstrate engineering and construction expertise, potentially providing opportunities with other gold and broader mining sector clients.
Tender activity is currently high, providing long-term visibility of significant engineering, mechanical and NPI projects coming up across iron ore, rare earths and gold.
Across RCR, DIAB and OFI incremental organic growth is expected in the near-term via expansion of opportunities with existing clients as well as the introduction of new clients nationally and internationally. This will be coupled with a continued focus on optimisation of cost structures to support profitability growth.
Beyond existing core capabilities, the MET businesses continue to develop several new technologies which have the potential to generate future revenue streams such as:
• Primero's process engineers continue the development of new simpler methods for refining hard rock lithium concentrates. The internally developed intellectual property is now well into the pilot testing phase and continues to produce results that will change the economics of lithium refining and potentially alleviate many of the start-up issues that hydroxide refineries currently experience.
• RCR successfully piloted its B2B Customer Portal with a tier one iron ore miner during the period. A market launch is planned for the second half of the year and is expected to further drive OEM product sales and support services.
• The launch of RCR's sealed pan feeder at MINExpo International in the USA in September 2024 proved successful, generating numerous strong ongoing enquiries from mining companies globally. Additionally, agencies in key internal markets are being identified to generate sales opportunities and customer support.
The innovation initiatives that are occurring across MET are expected to enhance competitiveness in the future and potentially deliver major new sources of revenue and profitability outside of direct contracting.
Work in hand currently totals $1.1 billion and there is a high level of tender activity with current active tenders totalling circa $1.5 billion.
Interim Dividend
In line with the Company's dividend policy, the Board has resolved to pay an interim fully franked dividend of 7.0 cents per share. The interim dividend will be paid on 10 April 2025.
Guidance
Guidance is updated and reconfirmed for FY25:
• Revenue expected to increase to $3.2 billion to $3.3 billion (from $3.1 billion previously guided);
• Earnings (EBITA) for FY25 expected to be between $205.0 million to $215.0 million (unchanged); and
• Cash and gearing consistent with long-term averages.
This ASX Announcement has been approved in accordance with the Company's published continuous disclosure policy and authorised for release by the Chief Executive Officer of NRW Holdings Limited.
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