Perenti Limited reported steady half-year revenue of $1.73 billion with a 10.9% increase in net profit, underpinned by a $300 million Dalgaranga contract and growing drilling services in the US. The company also announced an unfranked interim dividend and a CEO transition underway.
- Half-year revenue steady at $1.73 billion, down 0.1%
- Net profit after tax rises 10.9% to $70.5 million
- Awarded $300 million Dalgaranga contract in Western Australia
- Drilling Services revenue up 8.9%, driven by US market growth
- CEO Mark Norwell to step down by year-end; transition in progress
Financial Performance Holds Firm
Perenti Limited has delivered a largely stable financial performance for the half-year ended 31 December 2025, with revenue holding steady at $1.73 billion, a marginal 0.1% decline compared to the prior corresponding period. More notably, net profit after tax rose by 10.9% to $70.5 million, reflecting improved operational efficiencies and cost management across its divisions.
The company’s underlying earnings before interest, tax, depreciation and amortisation (EBITDA) saw a slight dip, but underlying EBIT increased by 3.2%, signalling a focus on quality earnings despite a challenging market backdrop.
Contract Mining Remains Core, New Wins Bolster Outlook
Contract Mining continues to be Perenti’s largest revenue contributor, accounting for over 70% of group revenue. The division secured a significant $300 million contract at the Dalgaranga Gold Project in Western Australia, reinforcing Perenti’s strong foothold in the Australian mining sector. This contract, spanning four years with an option to extend, highlights the company’s ability to win and execute large-scale mining projects.
Meanwhile, the company is advancing its diversification strategy, with a notable shift in geographic revenue mix. African projects now represent 39% of group revenue, down from 57% in FY19, while North American operations are gaining traction, exemplified by Barminco USA’s recent Letter of Intent from Barrick for early works at the Fourmile Project in Nevada.
Drilling Services Accelerate Growth, Especially in the US
Drilling Services posted an 8.9% revenue increase to $422.3 million, driven by higher utilisation rates and new contract awards, particularly in the United States. The division’s five drilling businesses, including Swick and Strike, are capitalising on rising demand for production and exploration drilling, especially in gold and copper projects. This segment now contributes nearly a quarter of group revenue and underlying EBIT, underscoring its growing importance to Perenti’s portfolio.
Balance Sheet Strengthened Amid Refinancing and Debt Reduction
Perenti’s balance sheet shows marked improvement, with gross debt reduced to $660.5 million; the lowest since the Barminco acquisition in 2018; and net debt down to $385.3 million. This was achieved through disciplined capital allocation, debt repayments, and a successful refinancing of its syndicated debt facility, which was oversubscribed and increased capacity to $650 million with extended maturities.
Liquidity remains robust with $818.2 million available, including $275.1 million in cash and $543 million in undrawn credit lines. These financial metrics position Perenti well to pursue growth opportunities while maintaining financial discipline.
CEO Transition and Dividend Update
In a significant leadership update, Managing Director and CEO Mark Norwell announced his planned departure, with the transition process expected to conclude by the end of the financial year. This change comes amid a period of strategic evolution and geographic diversification for the company.
On the shareholder front, Perenti declared an unfranked interim dividend of 3.25 cents per share, up from 3.0 cents in the prior period, payable on 9 April 2026. The company’s Dividend Reinvestment Plan remains suspended.
Outlook and Guidance
Perenti updated its full-year guidance, forecasting revenue between $3.45 billion and $3.55 billion and underlying EBIT(A) between $335 million and $350 million. Capital expenditure is expected to be around $325 million, with free cash flow exceeding $170 million. The company noted that recent AUD:USD exchange rate movements have tempered the upper end of its guidance, while some project delays have reduced capital spend expectations.
Looking ahead, Perenti anticipates further EBIT growth from operational improvements in Contract Mining and increased utilisation in Drilling Services, particularly as market conditions improve.
Bottom Line?
Perenti’s steady half-year results and strengthened balance sheet set the stage for growth, but the CEO transition and currency headwinds warrant close investor attention.
Questions in the middle?
- Who will succeed Mark Norwell as CEO, and how might leadership change impact strategy?
- How will Perenti’s expanding US footprint influence its revenue mix and margins?
- What are the risks and opportunities from currency fluctuations on Perenti’s FY26 guidance?