Austin carries strong momentum into H2

Staff reporter

Mining equipment parts manufacturer Austin Engineering says it is on track to deliver strong FY24 full-year earnings and revenue uplifts after turning in A$143.6 million sales and $15 million net profit after tax for the first half of the year.

The H1 revenue result was 26% higher year-on-year; NPAT was up 2.8 times yoy.

Australian-listed Austin’s FY24 NPAT target of $31-33 million is about 75% above last year while guided revenue of $310-330m is circa-24% higher.

Higher sales and improved operational performance drove EBITDA for FY24 H1 up 70% yoy to $20.8m, with margins increasing from 10.7% to 14.5%.

“Group EBITDA margins are edging closer to our 18%-20% target range, and revenue growth is equally strong on the back of increased orders across all product lines,” Austin CEO David Singleton said.

“These are trends we see continuing.

“We’ve overcome labour scarcity issues in Australia and the USA through upgrading manufacturing systems, automation, and capacity in all of our facilities globally. We’ve also positioned Indonesia as a major central hub, and grown that workforce, allowing us to build market share in truck trays and buckets.

“With bigger and more efficient facilities around the world we are designing and manufacturing a wider range of bespoke products that are delivering value to our customers and their operations.

“This formula has driven high levels of recurring revenue, and an order book value at multi-year highs.”

Austin’s $184m order book at the end of December was up 16% yoy.

The company said it “continued to win market share, particularly from OEMs” in the important North American market, where it has an estimated 1670 mine dump-truck trays in service. The division generated 29% higher revenue of $41.9m, versus the previous corresponding half.

Asia-Pacific revenue was up 19% yoy at $77.1 million. Australia was “profitable in the period, benefitting from investments made in retooling the operations to focus on new and rebuild mining buckets, a key focus following the acquisition of Mainetec”.

In South America, Austin grew sales 48% yoy to $24.6m in H1 and was now the largest non-OEM supplier of truck bodies in Chile.

Singleton said the company expected to be debt-free by the end of June this year.

It has reinstated an interim dividend with a 0.4c per share franked payout.

Singleton said Austin’s durable lightweight trays and buckets were helping miners improve operational and energy efficiencies.

The company’s recurring revenues, at 89% of total sales, reinforced its future order book.

Austin’s shares are up about 25% year to date at 42c, capitalising the company at more than $243 million.

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