Rising Costs and Debt Pose Challenges Despite MLG’s Revenue Growth
MLG Oz Limited has delivered a robust half-year performance with a 20.3% increase in statutory revenue and stable workforce numbers, setting the stage for anticipated growth in the second half of FY2025.
- Statutory revenue up 20.3% to $268.6 million in HY2025
- EBITDA steady at $29.3 million with margin at 10.9%
- Significant $29.2 million capital expenditure on fleet expansion
- Acquisition of Kalgoorlie accommodation facility to reduce costs
- Stable employee count of 1,141 amid challenging labour market
Strong Financial Momentum
MLG Oz Limited has reported a solid financial performance for the half-year ended 31 December 2024, with statutory revenue climbing 20.3% to $268.6 million. This growth reflects both organic expansion with existing clients and new contract wins, particularly in the gold mining sector, which accounts for 86.6% of revenue. EBITDA remained steady at $29.3 million, maintaining a margin of 10.9%, signaling consistent operational efficiency despite increased depreciation costs.
The company’s net profit after tax (NPAT) was $4.1 million, slightly up from $3.9 million in the prior half, underscoring a cautious but positive earnings trajectory. Net tangible assets per share rose 8.1% to 102 cents, reflecting the impact of recent investments and asset acquisitions.
Strategic Investments and Operational Enhancements
MLG’s first half results were influenced by a deliberate capital expenditure program totaling $29.2 million, focused on expanding and modernising its fleet to meet anticipated demand. This includes ramping up operations at key sites such as Granny Smith and Genesis, positioning the company to capture growth opportunities in the mining services sector.
Additionally, MLG acquired a dedicated accommodation facility in Kalgoorlie for $3.5 million, a strategic move aimed at reducing operational costs by replacing rented housing. This acquisition not only supports workforce stability but also enhances cost control in a region critical to the company’s operations.
Workforce Stability Amid Industry Challenges
Employee numbers remained stable at 1,141, reflecting a steady workload and the company’s focused recruitment and retention efforts. MLG continues to navigate a challenging labour market within the mining industry, emphasising training programs and staff retention as key priorities to sustain operational capacity.
Outlook and Market Position
Looking ahead, MLG is optimistic about the second half of FY2025, expecting stronger revenue and margin improvements driven by new project commencements and a robust tender pipeline. The company’s market position and expanded fleet capacity are well aligned to support client growth demands, particularly in the gold sector, which remains buoyed by record prices.
MLG is also exploring opportunities to move up the value chain by providing integrated mining-to-processing solutions for tier 2 producers, potentially leveraging its balance sheet for project funding and profit-sharing arrangements. This strategic direction could unlock new revenue streams and enhance long-term sustainability.
Bottom Line?
MLG’s disciplined investment and stable workforce set a promising stage for accelerated growth in the second half of FY2025.
Questions in the middle?
- How will MLG manage its increased gearing ratio amid ongoing capital expenditures?
- What impact will rising gold prices have on contract renewals and new project wins?
- Can MLG successfully expand into integrated mining-to-processing services as planned?
