Verbrec Secures $11M+ in Key Engineering Contracts, Eyes Strong Profit Growth

Robust Contract Wins Signal Growth Momentum

Verbrec Limited (ASX: VBC) has announced a significant haul of engineering and construction contracts valued at over $11 million during the second half of fiscal year 2025. These awards span critical sectors including defence, water infrastructure, and energy, underscoring the company’s diversified expertise and strategic positioning in growth markets.

The largest portion of the contracts, approximately $6.8 million, comes from Commonwealth Defence projects in South Australia. These involve electrical and control system upgrades, as well as ongoing maintenance of high-voltage infrastructure. This not only reinforces Verbrec’s long-standing relationship with Defence but also highlights its capability to deliver complex, lifecycle asset management solutions.

Expanding Footprint in Water Security and Energy Transition

Complementing its defence work, Verbrec secured $2.7 million in contracts related to water treatment and residential development projects in South Australia. The projects include a major control system upgrade for water processing facilities and the design of electrical infrastructure for vacuum pump stations. These awards align with the company’s focus on sustainable infrastructure and water security, a sector gaining increasing attention amid climate challenges.

Further bolstering its energy sector credentials, Verbrec won a $1.6 million contract for early works and constructability design on a gas pipeline and associated process facilities. This project builds on prior design phases and represents a strategic step in supporting Australia’s gas market transition and energy security initiatives.

Financial Outlook and Strategic Positioning

Verbrec’s management anticipates a solid profit performance for H2 FY2025, with earnings before interest, tax, depreciation, and amortisation (EBITDA) and net profit after tax (NPAT) expected to surpass previous half-year results. This optimism is underpinned by disciplined cost management, improved client relationships, and a strengthening cash position.

The company also notes that project deferrals, which had been influenced by the Australian election cycle, are beginning to ease, suggesting a more active pipeline of work ahead. Multi-year panel agreements and operations & maintenance contracts continue to provide a stable revenue base, while competency training services contribute to consistent performance.

Leadership Perspective and Market Implications

CEO Mark Read highlighted the success of the South Australian team and the company’s engineering-first approach, which enables Verbrec to deliver across engineering, construction, and commissioning phases. The recent contract wins not only demonstrate technical expertise in high-voltage electrical systems and automation but also reinforce the company’s commitment to sectors critical to Australia’s infrastructure and energy future.

As Verbrec moves forward, these contracts position the company well to capitalize on emerging opportunities in defence, water security, and energy transition, sectors likely to see sustained investment in the coming years.