Execution Risks Loom as GenusPlus Secures Major Rail Infrastructure Contract
GenusPlus Group has upgraded its FY2025 EBITDA guidance following strong quarterly results and acquisitions, while securing a significant $20 million rail infrastructure contract through its recent acquisition MGC Solutions.
- FY2025 organic EBITDA growth forecast raised to 28%-32%
- Additional $4-$6 million EBITDA expected from acquisitions
- MGC Solutions awarded $20 million multi-year rail level crossing upgrade contract
- Contract supports Arc Infrastructure’s five-year level crossing renewal program
- GenusPlus targets continued growth and national Tier 1 contractor status
Upgraded Earnings Outlook
GenusPlus Group Ltd (ASX, GNP), a specialist provider of power and communications infrastructure across Australia, has announced an upward revision to its FY2025 EBITDA guidance. The company now anticipates organic EBITDA growth of between 28% and 32% compared to FY2024, which had a normalised EBITDA of $45.3 million. This strong performance is bolstered by an additional $4 to $6 million in EBITDA expected from recent acquisitions.
The upgrade reflects better-than-expected financial results in the June quarter, driven by projects completing ahead of schedule and the integration of new acquisitions contributing to the second half of the financial year. GenusPlus management expressed confidence that these factors, combined with a robust order book and positive industry momentum, will sustain growth into FY2026 and beyond.
Strategic Acquisition and Contract Win
Central to this growth story is the recent acquisition of MGC Solutions, which has secured a multi-year contract valued at approximately $20 million with Arc Infrastructure. This contract involves comprehensive design and construction services for upgrading 46 level crossings across Arc Infrastructure’s rail network as part of a five-year renewal program.
The scope covers procurement, design, civil and structural construction, electrical installation, and testing and commissioning. This project not only enhances public safety at critical rail intersections but also strengthens the partnership between MGC Solutions and Arc Infrastructure, positioning GenusPlus as a key player in Australia’s rail infrastructure sector.
Positioning for National Growth
GenusPlus’ Managing Director David Riches highlighted the significance of this contract as a milestone in the company’s ambition to become a nationally scaled Tier 1 contractor. The company’s expertise in power networks and communications infrastructure, combined with its commitment to supporting the national energy transition, underpins its strategy to deliver long-term value to shareholders and stakeholders alike.
With a focus on safety, customer satisfaction, and technical expertise, GenusPlus is well-positioned to capitalize on emerging infrastructure demands, particularly in the context of Australia’s evolving energy landscape and infrastructure modernization efforts.
Bottom Line?
GenusPlus’ upgraded guidance and major contract win signal a strong growth trajectory, but execution risks on large projects remain to be monitored closely.
Questions in the middle?
- How will the integration of recent acquisitions impact GenusPlus’ operational efficiency and margins?
- What are the key risks and timelines associated with the $20 million rail level crossing upgrade project?
- How might GenusPlus leverage its expanded capabilities to secure further Tier 1 infrastructure contracts nationally?
