Duratec Achieves Record $650.8m Order Book and 10.5% EBITDA Growth in FY26

Record Order Book Fuels Confidence for FY27 Delivery

Duratec Limited (ASX:DUR) closed FY26 with a record order book of $650.8 million, a 66.9% increase from the prior year, setting the stage for a strong delivery year ahead. This surge is supported by a substantial tender pipeline valued at $1.3 billion and a broader project pipeline of $4.8 billion, providing the company with significant revenue visibility across its diversified markets.

The Managing Director, Chris Oates, highlighted that while revenue remained flat at $570.3 million, the company achieved record normalised EBITDA of $58.5 million, up 10.5%, and net profit after tax increased by 4.1% to $23.8 million. Earnings per share rose to 9.25 cents, and the Board declared a fully franked final dividend of 2.5 cents per share, maintaining a balanced approach between shareholder returns and reinvestment for growth.

Strategic Acquisitions Enhance Service Offering and Geographic Footprint

Duratec’s FY26 was marked by strategic acquisitions that expanded its technical capabilities and geographic reach. Key acquisitions include AMD Electrical Pty Ltd (EIG Australia), RGK Resources, Hunter Coatings, and Pacific Welding Australia (PWA), alongside the establishment of DXP Energy Solutions, a joint venture with Proxima Energy. These moves have broadened Duratec’s self-perform capabilities and strengthened its integrated asset lifecycle solutions across Defence, Energy, Mining & Industrial, Building & Facade, and Emerging Sectors.

Notably, the acquisition of PWA has boosted Duratec’s presence on the East Coast, particularly in the Hunter Region, complementing recent contract wins such as the construction management role at Orica’s Hunter Valley Hydrogen Hub. The group’s Energy sector has tripled in scale through these acquisitions, with significant projects delivered including fuel infrastructure upgrades at Kimberley and Onslow Marine Support Bases, and the $45 million plug and abandonment campaign for Lihir Gold Limited in Papua New Guinea.

Sector Performance: Margin Expansion and Project Milestones

The Defence sector generated $157.8 million in revenue, down 13% due to project timing, but improved gross margin to 17.4% and EBITDA margin to 8.4%. The commencement of the $281 million HMAS Stirling Diamantina Wharf upgrade through the Duratec Ertech Joint Venture (DEJV) represents a key milestone, enhancing Duratec’s role in AUKUS-related infrastructure investment.

Mining & Industrial revenue declined 16.3% to $114.3 million, reflecting timing delays, but gross margin improved to 23%, supported by higher-value structural integrity and maintenance work. The Building & Facade sector delivered record revenue of $138.8 million, up 24.1%, with gross margin rising to 19.9%, driven by façade remediation, heritage restoration, and the launch of Atec Facades, expanding into new-build façade construction.

The Energy sector saw 11% revenue growth to $91.6 million, bolstered by maintenance, fuel infrastructure, and engineering services, with an EBITDA margin of 14.7%. Emerging Sectors, encompassing Marine, Transport Infrastructure, and Water Infrastructure, recorded revenue of $67.8 million, up 11.8%, supported by major projects like the $68 million Darwin Ship Lift Blast & Paint Facility and the Kwinana Bulk Jetty Cathodic Protection Works.

Safety, Sustainability, and Governance Remain Core Focuses

Duratec maintained a strong safety record with zero lost time injuries in FY26, despite a modest increase in Total Recordable Injury Frequency Rate to 6.17. The company formalised its Critical Risk Standards framework and implemented the HammerTech platform for centralized safety and compliance management. Duratec also became the first Australian construction company accredited to ISO 19443, a nuclear sector quality standard, positioning it for participation in highly regulated Defence and nuclear supply chain projects.

Sustainability initiatives advanced with the launch of the inaugural Reflect Reconciliation Action Plan, endorsed by Reconciliation Australia, and the company’s first statutory Sustainability Report. Duratec established a target to reduce Scope 1 and 2 emissions intensity by 30–50% by 2035, supported by fleet electrification and battery energy storage systems deployments.

Financial Position Supports Growth and Strategic Investments

Duratec closed FY26 with a robust balance sheet, net assets rising 26.2% to $93.8 million and cash holdings of $78.8 million. The company invested $12.1 million in plant and equipment and $14.4 million in acquisitions during the year while maintaining strong cash conversion at 74%. Total borrowings increased to $39 million to support growth initiatives, with $343.5 million in total funding facilities, providing ample liquidity for future opportunities.

Master Services Agreements and annuity-style contracts contributed $185.3 million in revenue, representing 32.5% of total revenue and providing a stable, recurring income base. The group’s disciplined project selection and increasing self-perform capability have driven margin expansion, with gross profit margin improving from 18.6% to 20.5% and normalised EBITDA margin increasing from 9.2% to 10.3%.

Board Changes and Leadership Continuity

The Board announced the appointment of Jamie Cullen as a Non-Executive Director effective 1 October 2026, bringing extensive executive and board experience. Gavin Miller retired following the FY26 Annual General Meeting. The Board continues to emphasize strong governance, risk management, and capital discipline as the company scales its operations.

What to Watch Next

Duratec enters FY27 with a record order book and a diversified pipeline, poised to convert Early Contractor Involvement projects into full delivery. The transition of major contracts like the HMAS Stirling Diamantina Wharf upgrade, Darwin Ship Lift Facility, and Lihir Gold plug and abandonment campaign will be critical revenue drivers. Investors will be watching how effectively Duratec integrates its recent acquisitions and scales its expanded service offerings, particularly in energy infrastructure and Defence.

Additionally, the company’s progress against its sustainability targets and safety performance will remain under scrutiny as climate-related risks and regulatory expectations intensify. The balance between maintaining strong margins and investing in growth and capability expansion will test Duratec’s operational discipline in the coming year.