Operator [26]
Your next question comes from Ian Munro from Ord Minnett.
Ian Munro, Ord Minnett Limited, Research Division - Senior Research Analyst [27]
Apologies. Just been juggling other calls.
This might have been asked already.
Just on the utilities segment and the contract wins that have come through, how much of this is incremental in the second half?
And how should we think about the growth rate into FY '22 within utilities?
And then perhaps just how should we be thinking about margins in utilities, whether that's maintainable versus the first half now that there's less productivity constraints?
And perhaps just a third follow-up on the maintenance piece in the telco segment.
Perhaps, how is that tracking versus pcp? And should -- is it reasonable that we think about that growing into the second half?
Leigh MacKender, Service Stream Limited - MD & Director [28]
No problems at all, Ian. I'll try and go over that.
If I miss anything, Linda will update you.
But your first point around utilities, that growth, as we said, what we've seen, Ian, is the metering services area that has been sort of the core of our utilities focus prior to the acquisition of Comdain.
That suffered some impacts around the moratoriums on disconnection/reconnection, the meter exchange works, but was offset by growth in Comdain.
Comdain has grown revenue by over 5% in this period.
And that's incremental growth.
That's reflecting a business securing more design and construction and operations and maintenance agreements.
So we referenced a couple of those major ones there in the presentation.
Most notably, SEQ Water, a D&C contract for a new pipeline and pumping infrastructure.
But there have been a number of other contracts that have been secured over that period.
You often see that. They'll be secured in a period of time, and then it will take sort of 3, 6, 12 months for us to deliver that work depending on the nature of the operations.
So that's really what's happened in the utility sector.
In terms of margins, we've always guided our margins historically have been a little higher in our metering services space.
They came down as we consolidated and integrated Comdain into the business, which is a low-margin business.
We're pretty comfortable with those margins there.
They were always under pressure, as all of those are across the business.
But generally, we see that as pretty consistent in terms of where we've delivered to this half.
There's always swing factors.
And hopefully with the COVID moratorium sort of coming off and it's regimenting some of those metering services, which have historically been higher margins, that will provide some opportunity.
But we're not calling out to say we expect them to grow over the next period.
Ian Munro, Ord Minnett Limited, Research Division - Senior Research Analyst [29]
- And then just in terms of the third piece around the maintenance component of the telco segment.
Leigh MacKender, Service Stream Limited - MD & Director [30]
Certainly, sorry.
So maintenance in terms of telco, obviously, 2 of our major agreements there are the -- those with NBN, unified services and networks.
So pleasingly, now, we've gone through that period of having to re-sign those.
What we expect to see is a core base around both reactive and planned maintenance across those.
Obviously, activations, which is under the unified services agreement, has been a major part of our growth over the prior years.
And that will continue to sort of decline as we continue to activate customers and they complete their process over to the migration of NBN.
So we're conscious of that day to come off.
But there is a strong maintenance base there, and that will grow over time as more customers are connected across to the network.
What we haven't seen in the second half, I should mention, is those proactive maintenance upgrades.
That's something that if we look back over the last 2 years, and we've talked about this at the AGM and over our briefings, we'd always had the second half bias around proactive upgrades of infrastructure.
That was initially delayed during the COVID pandemic, and we've not seen that come back on.
And normally, it's around this February time period where we start to see those volumes kick in.
And you would have seen that through those appendices that we had in the pack where you see NBN minor projects and other works sort of having that second half bias.
And that's one of the factors in the outlook for the rest of the year.
Ian Munro, Ord Minnett Limited, Research Division - Senior Research Analyst [31]
So just on that shorter-term outlook. If we looked at the second half and split it between things that are subject to contract timing and things that are subject to contract wins and blue sky, like how are we sort of thinking about the buckets in order to get to that second half guidance?
Leigh MacKender, Service Stream Limited - MD & Director [32]
There's little blue sky.
We don't often forecast for blue sky.
We have to look at current programs and engage with clients.
So certainly, we've had to take, I suppose, a reasonable view of where we are in February and the ability of the business to secure extra work. I think the second half really reflects the work in hand.
We still got to ensure that we deliver well and volumes are delivered in line with our expectations, and that's obviously an area where we continue to see challenges in terms of gaining that visibility.
But I think at this stage, we're very comfortable with the guidance we provided in the second half reflecting the first.
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Operator [33]
(Operator Instructions) Okay, we appear to have no further questions on the queue.
So I'll hand back to you for now, Leigh.
Leigh MacKender, Service Stream Limited - MD & Director [34]
Thank you very much. I appreciate everyone joining us today, and no doubt we'll speak soon.
Thank you.
-------------------------------------------------------------------------------- Operator [35] -------------------------------------------------------------------------------- Ladies and gentlemen, that does conclude today's conference call. Once again, thank you all for participating today, but you may now all disconnect.
(20min delay)