Morgans
ACF has acquired two businesses in the Industrial Access space for a total consideration of $29m (including earn-out payments). This implies an EV/EBITDA multiple of ~4x (before synergies), which is consistent with management's target for acquisitions.
Management has decreased FY25 earnings guidance due to ongoing project delays. We see this as largely a timing issue with EBITDA of ~$9m pushed into FY26.
Factoring in the acquisitions and updated earnings guidance sees FY25/26/27F EBITDA change by -4%/+3%/+2%.
Our target price remains unchanged at $1.32 and we maintain our Add rating. While project delays are impacting earnings in FY25, year-to-date (YTD) secured hire contract wins (a key leading indicator of future performance) jumped 35%. This suggests to us that the pipeline remains strong and will underpin solid growth for ACF when activity picks up (particularly in QLD as infrastructure projects associated with the Brisbane Olympics need to start soon to be ready for the event in 2032).
(20min delay)