Australian drilling contractor Dynamic Group Holdings has seen its share price leap 29% after announcing a 240% year-on-year increase in net profit to A$9.2 million on 218% higher revenue for FY22 of $74.1m.
The company, operationally focused on Western Australia, finished FY22 with 47 drill rigs and more than 300 employees working on 17 projects, mainly in gold, lithium and iron ore.
Its July 2022, $19m acquisition of mining-sector focused water drilling business Welldrill is expected to generate $7-8m EBITDA and $26-28m revenue in FY23.
Dynamic paid $21.4m in May 2021 for WA company, Orlando Drilling.
The group has expanded EBITDA from $2.2m to $17.1m (23% EBITDA margin), NPAT from $0.4m to $9.2m, and revenue from $15.5m to $74.4m, over the past two years. It is targeting EBITDA margins around 25% over the “long term”.
“Our first two years as a listed company have seen us deliver year-on-year growth in revenue and earnings,” Dynamic non-executive chairman Garret Dixon said.
“Our strategic acquisition of exploration drilling company Orlando Drilling has contributed to our growth and it is important to note we have not included any contribution from the acquisition of the water drilling business Welldrill, which closed after the end of the financial year.
“The markets we are operating in have experienced strong growth, and we see ongoing solid demand for all commodities. We now have an integrated offering across water drilling, exploration drilling and production drilling so we are well placed to leverage the buoyant market conditions.”
ASX-listed Dynamic’s share price surged 29% Wednesday to 40c, capitalising the company at $47m.