GR Engineering Services delivered a record EBITDA of $63.1 million in FY26, secured over $1 billion in new contracts, and announced a $110 million equity raise to support a forecast revenue surge in FY27.
- Record FY26 EBITDA of $63.1 million
- Over $1 billion in new contract awards since April 2026
- FY27 revenue guidance of $825-$850 million, up 67-72%
- Institutional placement and SPP to raise $110 million
- Final fully franked dividend increased to 13 cents per share
Record Earnings Backed by $1 Billion Contract Haul
GR Engineering Services Limited (ASX:GNG) has capped FY26 with a record EBITDA of $63.1 million, up from $57.2 million the previous year, on revenue of $493.2 million. This solid performance is underpinned by a contract bonanza exceeding $1 billion since April 2026, spanning a diversified commodity base and multiple geographies. The company’s Managing Director, Tony Patrizi, highlighted the strong market sentiment driving expansion and greenfield projects across a broad range of commodities.
Major EPC Contracts Fuel Growth Pipeline
The engineering, procurement, and construction (EPC) order book is bolstered by several high-profile contracts executed post year-end. Notable wins include a $275 million EPC contract for the Yitirrti (Sulphur Springs) Copper-Silver-Zinc Project with Develop Global Limited, a $233 million contract for the Davyhurst Expansion Project with Ora Banda Mining, and a $230 million brownfield upgrade at BHP Iron Ore’s Yandi Eastern Front-End Facility in the Pilbara. These projects, alongside others such as the Laverton Processing Plant and Sorby Hills Silver-Lead Project, anchor the company’s FY27 and FY28 workload. The Yitirrti contract, in particular, reinforces GR Engineering’s credentials in base metals processing and was the subject of a recent detailed announcement $275 million EPC contract for Yitirrti project.
Energy and Process Controls Businesses Expand Earnings Visibility
GR Production Services (GRPS) continues to deliver steady revenue through operations and maintenance services across Australia's gas and LNG sectors, including a new five-year contract valued at $57 million for the Sturt Plateau Compression Facility in the Beetaloo Basin. Meanwhile, Mipac and Paradigm, the Group’s process controls arms, have expanded their contract pipeline with repeat clients such as First Quantum, BHP, Rio Tinto, and Anglo American, providing automation and digital solutions that span mineral processing and energy sectors.
Dividend Boost and Strong Balance Sheet
Reflecting confidence in its financial position, the Board has increased the final dividend to 13 cents per share, fully franked, lifting total FY26 dividends to 25 cents per share, up from 22 cents in FY25. The company holds a robust cash balance of $87.9 million with zero external debt, supported by strong operating cash flow of $62.7 million in FY26. The Dividend Reinvestment Plan (DRP) will apply to the final dividend with a 2.5% discount on allocation price.
$110 Million Equity Raising to Fuel Growth and Flexibility
To underpin its growth trajectory, GR Engineering is undertaking a $100 million institutional placement and a $10 million share purchase plan (SPP), both priced at $6.10 per share. The proceeds will fund working capital for recent and upcoming contract awards, support potential acquisitions, and finance internal IT infrastructure expansion. This marks the first equity raising since the company’s 2011 IPO, signaling a strategic shift to capitalise on the booming mining and energy services market. Post raising, the pro forma cash position is expected to approach $198 million, maintaining a debt-free balance sheet.
FY27 Revenue Guidance Signals Step-Change
GR Engineering forecasts FY27 revenue between $825 million and $850 million, representing a 67% to 72% increase over FY26. Impressively, over 90% of the high-end revenue guidance is secured through contracted projects, with the remainder expected from studies and minor works. The revenue mix is also shifting, with more than 60% expected from commodities other than gold, reflecting the Group’s diversified client base and commodity exposure. The company continues to build its pipeline for FY28, supported by early works and a high volume of studies across various commodities and geographies.
Governance and Risk Management
The Board, chaired by Phillip Lockyer, maintains a strong focus on governance, risk oversight, and ESG commitments. The Group’s Total Reportable Injury Frequency Rate improved to 2.81 in FY26, though one Lost Time Injury was recorded, emphasizing ongoing safety vigilance. Risk factors highlighted include project delivery risks, economic cycles, recruitment and retention challenges, and cyber security, with the company deploying robust policies and systems to mitigate these.
Bottom Line?
GR Engineering’s record earnings and robust contract pipeline set the stage for a transformative FY27, but execution risks and integration of growth initiatives warrant close attention.
Questions in the middle?
- How will GR Engineering deploy the proceeds from its $110 million equity raise to maximise growth and shareholder value?
- What impact will the diversification away from gold-centric projects have on the Group’s risk profile and margins in FY27?
- Can the company sustain its high project execution levels amid a rapidly expanding contract book and evolving market conditions?