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Austin Engineering releases 1H21 results

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Global Mining Review,

Austin Engineering Ltd has announced its results for the first half of the financial year 2021 (1H21). The company confirms that guidance for underlying NPAT in excess of AUS$9 million for FY2021 remains unchanged.

1H21 highlights

  • Total revenue from continuing operations AUS$87.9 million in line with pcp (AUS$89.1 million).
  • Normalised EBITDA from continuing operations increased 32% to AUS$6.3 million vs pcp.
  • Normalised EBITDA margins from continuing operations lift to 7.2% vs 5.4% pcp.
  • 1H21 underlying NPAT from continuing operations AUS$1.5 million (AUS$0.2 million 1H20).
  • Cash outflow from operations of AUS$6.8 million due to movements in working capital.
  • Fully franked FY2021 interim dividend of 0.2 cents per share, payable 5 April 2021.
  • Austin reiterates FY2021 guidance of underlying NPAT in excess of AUS$9 million.
  • 90% of order book required to achieve guidance already secured.
  • Austin sees continued strong APAC performance, and turnaround in North America.

Austin Managing Director, Peter Forsyth, said: “Asia-Pacific continues to perform strongly while our first half results were impacted by the effects of COVID-19 in both North and South America. We have commenced the calendar year with a significantly improved outlook in North America with a number of orders received in January and February 2021, supporting a continuation of strong performance expected in Asia Pacific.

“Consequently, our order book is currently at 90% of the level required to meet guidance, which is a higher level than typical for the business and importantly all facilities have in excess of 80% of their required revenues locked in. Coupled with the likelihood of conversion of uncommitted opportunities, we are maintaining our full year 2021 guidance of underlying NPAT in excess of AUS$9 million. We recognise the need for a much improved second half, but we are confident in our ability to meet our guidance target. The nature of our business is that incremental revenue above the level of our fairly static fixed facility costs flows strongly to our bottom line, supporting the strong second half required to meet guidance.”

Financial results

Group total revenues were broadly in line with the previous corresponding half, down 1% to AUS$87.9 million. By region, Asia Pacific revenue increased 24% to AUS$60.5 million, supported by strong earnings performances in Austin’s Perth and Indonesian operations on a solid order book at the start of the year. In contrast, revenues in the company’s North American operation fell 58% to US$12 million due to an unstable political climate and the implications of COVID-19, including its impacts on commodity markets, particularly oil prices, impacting on capital demand for new equipment during the first half, however this trend is reversing in the second half.

Following a strategic review of its Colombian operations, announced in June 20201, the company announced it will wind up its operations in Colombia, with the review determining its operations there were unable to make a sufficient contribution to group earnings.


Austin maintains its full year 2021 guidance of underlying NPAT from continuing operations in excess of AUS$9 million. Austin communicated this guidance in August 20202, and as reiterated at the November 2020 AGM, the full year’s balance of earnings is weighted to the second half of the year.


Approximately 90% of projected revenue required to achieve guidance is committed in our current order book, including earned revenue and other committed work. While on level with the same time last year, the company sees a continued strong order book from Asia Pacific and North America, especially in 2H21. Currently, all individual Austin business units have locked in more than 80% of required work to meet earnings guidance targets, and all facilities have sufficient capacity to exceed their respective targets. The quality and likelihood of conversion of certain uncommitted opportunities provide confidence in the company’s forecast revenue targets.

Regionally, Austin sees Asia-Pacific continuing to perform well with further orders received since the November 2020 AGM supporting the balance of FY2021. Austin’s Perth and Indonesian facilities are more than 90% committed to enable guidance targets to be met, with strong opportunity pipelines.

In North America, Austin has received orders for in excess of 50 truck bodies, across multiple customers and commodity applications, in the first 8 weeks of 2H21 for delivery by 30 June 2021. This compares to delivery of 33 truck bodies in 1H21. With a new US Administration in place, and improved oil prices, order intake has improved significantly, assisting our 2H21 outlook

South America’s near-term outlook remains uncertain amid significant COVID-19 impacts despite buoyant copper prices. Large opportunities are being tendered on that are likely to benefit future years. A stronger second half is expected based on near-term opportunities.

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