GR Engineering Services reports a solid half-year performance with $218 million revenue and a raised interim dividend, underscoring confidence amid softer top-line results.
- HY26 revenue of $218 million, down from $272.1 million in HY25
- EBITDA of $27.8 million with consistent margin percentage
- Interim fully franked dividend increased to 12.0 cents per share
- Strong cash position of $86.5 million and $39.6 million net operating cash flow
- Robust project pipeline including King of the Hills and Eloise Copper Expansion
Solid Operational Performance Amid Revenue Decline
GR Engineering Services Limited (ASX: GNG) has released its financial results for the half year ended 31 December 2025, revealing a mixed but generally positive picture. The Group reported revenue of $218.0 million, a noticeable decline from $272.1 million in the same period last year. Despite this, the company maintained an EBITDA margin consistent with prior periods, delivering $27.8 million in EBITDA and $25.0 million in profit before tax.
The softer revenue reflects the natural ebb and flow of project timing in the engineering services sector, but GR Engineering’s management remains confident, pointing to a strong contracted project pipeline extending well into FY27. This includes significant ongoing work on major projects such as the King of the Hills Operations upgrades, Eloise Copper Expansion, and the Dalgaranga Paste Plant.
Dividend Increase Signals Board Confidence
In a move that underscores the Board’s positive outlook, the interim fully franked dividend has been increased to 12.0 cents per share, up from 10.0 cents in the prior corresponding period. The Dividend Reinvestment Plan remains in place with a 2.5% discount, offering shareholders an attractive option to increase their holdings. This dividend rise comes despite the revenue dip, highlighting the company’s strong cash flow and balance sheet health, with cash reserves climbing to $86.5 million.
Diverse Subsidiary Contributions and Contract Wins
GR Engineering’s subsidiaries continue to bolster the Group’s earnings visibility. GR Production Services has expanded its footprint in the energy sector, securing longer-term operations and maintenance contracts with major clients including Santos, Chevron, and Mitsui E&P Australia. Meanwhile, Mipac and Paradigm, specialists in control systems and automation, have won new contracts from industry heavyweights such as BHP, Rio Tinto, and First Quantum, reinforcing the Group’s presence across mining and energy sectors.
These wins, combined with a high volume of studies and early contractor involvement engagements, suggest a healthy pipeline and diversified revenue streams that could help smooth out future earnings volatility.
Looking Ahead
The Group’s forecast for full-year revenue remains optimistic, targeting between $500 million and $520 million, up from $479 million in FY25. This guidance reflects confidence in the ongoing execution of current projects and the potential for new contract awards. Managing Director Tony Patrizi emphasised the team’s dedication and the Group’s operational momentum, highlighting recent practical completion of the Kainantu Gold Project as a key milestone.
Overall, while the half-year results show some revenue softness, GR Engineering’s strong cash position, dividend increase, and robust project pipeline paint a picture of resilience and strategic positioning in a competitive sector.
Bottom Line?
GR Engineering’s dividend hike and solid cash flow suggest confidence, but investors will watch closely for revenue recovery in the second half.
Questions in the middle?
- What factors contributed to the revenue decline despite steady EBITDA margins?
- How will the Group’s project pipeline translate into earnings in FY27 and beyond?
- What impact might rising costs or market conditions have on upcoming projects?