Here's my preliminary analysis:New hire contracts in June...

Here's my preliminary analysis:

• New hire contracts in June amounted to 15.7% of the yearly total of $78.3M, when pro-rata would have been only 8.3%. This indicates a very strong end of the year in hire contract wins, leading to a strong start in FY25.
• Note that guidance was reaffirmed in May, before the strong June was known. This indicates to me that an upgrade in guidance for FY24 is possible, as the detailed financial results become known to management. The actual growth will depend very much on growth in the other areas such as the high-margin formwork.
• The yearly growth rates in new hire contracts and sales pipeline are lower for FY24 than FY23, indicating that FY25 may not achieve the same very high revenue growth rates guided for FY24. Total revenue growth last year was 14%, and current guidance is for growth of 31% to 40% in FY24. My expectation for FY25 revenue growth is for somewhere in between the growth rates achieved in FY23 and FY24, but it is way too early yet for me to put a figure on it. We will hopefully know more when the yearly results are released in August.
• Acrow has a very strong record of Earnings Before Tax growing much faster than revenue, due to expanding margins. I am hopeful this can also continue for FY24 and FY25. If so, EBT growth for FY24 should be above 35% (the amount depending on the revenue split between formwork and industrial services).