Monadelphous Group Limited

Good day and thank you for standing by. Welcome to MonaDelta's 2026 Have Your Results presentation. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 and 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 and 1 again. Please be advised that today's conference is being recorded. And I'd like to hand the conference over to Christy Glasgow, Company Secretary. Please go ahead.

Hello and welcome to the Monodelphus 2026 Half-Year Results Investor and Analyst Briefing. I'd like to begin by acknowledging the traditional owners of the lands on which we are joining you from today in Vooloolootur, the Whadjuk people of the Noongar Nation and the traditional owners of countries. and pay respect to Elders past, present and emerging, and extend that respect to all Aboriginal and Torres Strait Islander people. Presenting from Perth, I'm on Adelphos' Managing Director, Zoran Bebic, and Chief Financial Officer, Phil Truman, who are joined in the room by our Chair, Rob Belletri. Throughout this presentation, the speakers will guide you on when to click through to the next slide. The structure of this morning's presentation will be similar to previous results presentations with some further detail provided as appendices. Copies of today's presentation and associated materials are available on our website at monodelphus.com.au. I will now hand over to our first presenter today, Zoran Bebic, who will start on slide two.

Zoran Bebic Thanks Kristy and welcome to our 2026 Half Year Results Briefing. Today, Phil and I will present our financial and operational performance for the six months ended 31 December 2025, as well as our outlook. We will then answer any questions you may have. I'll begin with our group performance and highlights on slide three. Monad Office has had a fantastic start to FY26, achieving a record revenue of $1.53 billion for the half year, which is a 46% increase on the prior corresponding period. We experienced strong operating conditions across all sectors, with activity levels supported by the record level of work secured during the previous financial year. Our engineering construction division delivered revenue of $677.8 million, up around 67% on the prior year, supported by service expansion and growing capability in end-to-end delivery, particularly from Melcor and Interforge. Zenbyron, our renewable energy business, also saw increased levels of project activity from larger wind and battery energy storage projects. Our maintenance and industrial services division reported a record half-year revenue result of $852 million, up 32% on the same time last year, reflecting an increase in energy sector activity and sustained strong demand in iron ore. Earnings before interest, tax, depreciation and amortisation was $116.2 million, an increase of 46% on the prior year, delivering an EBITDA margin of 7.59%. Strong operational performance resulted in net profit after tax increasing 53% on the prior year to $64.9 million, delivering earnings per share of $0.652. The board declared a fully franked interim dividend of 49 cents per share. We ended the half year with a cash balance of $322 million and a very strong cash flow from operations of $171 million, resulting in a cash flow conversion rate of 186%. Phil will talk about this more later. We continue to progress our markets and growth strategy. In late 2025, we acquired Perth-based Kerman Contracting, a design and construct business specialising in non-process infrastructure with a long established reputation for the successful delivery of site infrastructure and accommodation, bulk storage and materials handling facilities across a range of sectors. We also acquired Australian Power Industry Partners, APIP, a high-voltage electrical contractor based in Brisbane. APIP is a specialist provider of end-to-end high voltage solutions, including design management, procurement, construction and renewals of power transmission, distribution and substation infrastructure. We also completed the acquisition of Perth-based high voltage business, High Energy Service, further strengthening our electrical capability. These acquisitions support the broadening of our delivery capability and open new markets for us. Moving now to slide four, Mononautas has secured a healthy $1.4 billion in new contracts and contract extensions since the beginning of the 2026 financial year. Strong demand for construction and maintenance services from Western Australia's iron ore sector continued and we're awarded more than $1 billion of contracts with blue chip customers. This comprised several major construction contracts including a multi-disciplinary contract for BHP's Jimble Bar train loadout replacement project with earthworks and symbols to be delivered by Melcor and fabrication and procurement provided by Interforge. We also secured a $175 million contract with BHP associated with a car dumper project at Finnegan Island in Port Hedland. as well as an integrated multi-disciplinary contract with Rio valued at around $250 million associated with the Brockman Sinkline 1 iron ore deposit development. We were awarded a five-year maintenance services contract with Rio Tinto totalling approximately $300 million to continue providing fixed plant and shutdown services across Rio's Pilbara iron ore operations. We also secured a three-year extension to our maintenance master services agreement across BHP's Pilbara operations and were appointed to the BHP WAIO site engineering panel for another two years. In the energy sector, we expanded our customer base with the award of a four-year contract with BW Offshore to provide maintenance services at the BW Opal FPSO facility approximately 300 kilometres north-northwest of Darwin. We also secured a contract for the hookup and commissioning of Shell's Crux platform off the coast of WA, which forms part of the long-term backfill to Shell's pre-use facility. Zimbiron was awarded a contract with Flow Power for the delivery of the Bennetts Creek battery energy storage system in the Latrobe Valley, Victoria, which includes balance of plant design, construction, installation and commissioning. Over the next few slides, we'll cover the key areas of focus under our sustainability framework, being people, safety and wellbeing, diversity and inclusion, community and environment. Moving now to slide five, people. Our total workforce at 31 December 2025, including subcontractors, was around 8,400. reflecting sustained high levels of activity across the business. We remained focused on investing in the development of our people and saw around 150 emerging leaders participating in our suite of leadership and mentoring programs and approximately 340 graduates, apprentices and trainees participating in our early career programs. Our registered training organisation engaged with over 5,000 trades personnel with more than 6,500 training interactions during the period, comprising high-risk work licence accreditation and verification of competency. We also continue to offer services such as skin checks and resources to support our employees' physical, mental and emotional wellbeing. Let's now look at safety and wellbeing on slide 6. Our high potential incident frequency rate returned to historically low levels and the 12-month injury frequency rate at the end of December was 4.34 incidents, a slight improvement to that of 30 June 2025. In line with our guiding principle, the safe way is the only way, we continue to implement targeted campaigns to drive improved safety performance. Our ongoing fatal risk awareness program is focused on active hazard monitoring. of controls during high-risk tasks. As a part of this, we reviewed our forklift operations and implemented a range of improvements aimed at preventing loss of control of loads and making pedestrian interactions with mobile plants safer. We also reviewed the effectiveness and efficiency of high-risk work competency assessments and continued to use drone technology to eliminate the need for people to enter confined spaces. We again achieved recognition for our commitment to safety, wellbeing and innovation, with awards and nominations from various industry bodies including ARIA, the Crane Industry Council of Australia, Workplace Health and Safety Foundation and DMERS. Moving now to diversity and inclusion, community and environment on slide seven. We maintained our focus on leaving a positive legacy in our local communities, strengthening diversity and inclusion across our workplaces and progressing towards our goal of net zero. We continue to support employment pathways and development opportunities for Indigenous Australians through traineeships, apprenticeships and the Indigenous Pathways Program in partnership with Rio Tinto. Pleasingly, our Aboriginal and Torres Strait Islander workforce participation rate of 3.3% continues to exceed our target. We progressed renewing our next Stretch Reconciliation Action Plan, continuing to focus on Indigenous employment, training and development and supporting Indigenous businesses. Our spend with Indigenous businesses continues to grow, more than doubling that compared to the same period last year to around $20 million. We continue to promote development opportunities for women across the business and our efforts were recognised externally with a number of our people honoured at industry awards, including at the BHP Women in Resources National Awards and the Gladstone Engineering Alliance Awards. Our community grants program expanded to include Gladstone in Queensland, Roxby Downs in South Australia and Kalgoorlie, Newman and Port Hedland in WA. with eight regions now participating in the program. We also launched our inaugural Local Legends campaign to showcase our people making exceptional contributions to the community. To minimise the impact of our operations on the environment, we continued transitioning our facilities to renewable power with the installation of a solar system at our workshop facility in Darwin and expanded the rollout of our electric and hybrid vehicles. Turning now to our engineering construction divisional highlights on slide eight. Our engineering construction division reported revenue of $677.8 million for the six months, an increase of 67% on the prior corresponding period. The result was driven by strong demand for construction services across all sectors, particularly iron ore and energy, with a greater contribution from vertically integrated projects. The division has secured approximately $770 million of new work since 1 July 2025. We successfully completed BHP's Car Dumper 3 renewal project in Port Hedland and All Body 32 in Newman, as well as services at Rio Tinto's Western Range project in Paribas. We also secured an electrical and instrumentation package at Rio Tinto's Parker Point near Dampier. Work progressed on a multidisciplinary contract at BHP's prominent fuel copper expansion project in South Australia. We also completed work at Taliesin Lithium's Greenbushes site in the southwest of WA. MELCOR continued structural concrete works at Pertamon's urea plant located near Dampier, with Elevero providing heavy haulage services to the project. MELCOR also progressed work on the Geraldton Port maximisation project in WA for Midwest Ports Authority. In the energy sector, we progressed construction works on modifications to the existing woodside operated Pluto LNG Train 1 facility near Karratha, with the Levero also providing specialist haulage and lifting services to other woodside operated facilities in the region. We also continued the installation and modification of essential electrical power and control infrastructure at Chevron Australia's Jans IO compression project. Interforge continues to support a Lucas Iniava rare earths refinery project with the supply and fabrication of structural steel work and pipe racks and secured a two year extension to its agreement with Origin for the supply of modularised equipment for APLNG in Queensland. In the renewable energy sector, Zembiron progressed the balance of plant works for the Wurundjeri Battery Energy Storage System, or BESS, for Energy Australia in the Latrobe Valley, Victoria, as well as balance of plant works at CS Energy's Lotus Creek Wind Farm in central Queensland. Work also progressed with the construction of Fortescue's North Star Junction BESS, supporting Fortescue's commitment to decarbonising its Pilbara operations. Looking now at our maintenance and industrial services division on slide nine. Our maintenance and industrial services division reported revenue of $852 million for the half year, up 32% as we saw strong demand continue for services, particularly in the energy and iron ore sectors. Since the beginning of the financial year, the division has secured approximately $640 million in new contracts and contract extensions. A significant volume of the work was delivered for our energy customers, including shutdown and other major works for impacts, with over 1,000 people mobilised across offshore and onshore facilities over the period. We continue to provide ongoing maintenance and turnaround services for Woodside's onshore and offshore gas production facilities in WA's North West. This included preparations for shutdown activity and planning work associated with the hookup and commissioning of Woodside's floating production unit in the Scarborough gas field. We continue to deliver maintenance and minor construction services for Shell at the Prelude FLNG facility and at QGC's Curtis Island LNG operations in Gladstone, Queensland. As previously mentioned, we expanded our customer base in the energy sector by securing a four-year contract with BW Offshore. WA's iron ore sector continued to drive strong demand and we provided fixed plant maintenance services and sustaining capital projects to Rio Tinto, fixed plant services to Fortescue and general maintenance services to BHP. For Rio Tinto, we secured a 12-month extension to provide marine infrastructure maintenance and minor projects at Rio's Cape Lambert and Dampier ports. We were also awarded a contract for modifications to the existing process plant at Rio Tinto's Hope Downs II project. In addition, we continue to deliver fabrication, supply, installation and commissioning services at the Tom Price mine, as well as non-processed infrastructure services at Brockman Fork. Under our BHP Wayo Asset Projects Framework Agreement, we secured works at berths C and D at the Finnegan Island port facilities in Port Hedland. In South Australia, we continued at BHP's Olympic Dan mine site in Roxby Downs, as well as South 32's Worsley Illumina operations in WA. For Newmont's gold operations, we secured a five-year extension to our existing contract delivering general maintenance services in Boddington WA and Tanami Northern Territory and provided sustaining capital projects and maintenance at Lahere Island in Papua New Guinea. Also in PNG, we continued work for Santos in the Southern Highlands region where we secured a contract for the demolition of the Hideo Pipeline Bridge. We'll now move to slide 10 and I'll hand over to Phil who will provide you more detail on our financial performance.

Thank you, Zoran, and good morning, everyone. So this slide, slide 10, compares our financial performance for the half year end at 31% for 2025 to that of the previous corresponding period. And as you can see, it's been a very strong six months from a financial perspective. Revenue from contracts with customers is $1.53 billion, which is up around 46% from last year. and earnings before interest tax depreciation and amortisation was $116.2 million, an increase of 46% on the prior corresponding period, and results in an EBITDA margin of 7.59%. As Zorin mentioned, our strong operational performance delivered net profit after tax of almost $65 million, up 52.6% from last year, resulting in an earnings per share of 65.2 cents. and the board declared an interim dividend of $0.49 per share fully franked, with the Monad Alpha's dividend reinvestment plan to apply to the interim dividend. We ended the half year with a very strong cash balance of $322 million, which was boosted by a number of material advances received during the period. The cash balance included about $20 million from the acquisition of Kerman Contracting, which was owed to the vendors under the terms of the acquisition. Increased activity levels within the business in the months leading up to 30 June 2025, so the end of the last financial year, resulted in a significant increase in receivables at that date. The collection of these debtors' balances during the six months contributed to a very strong cash flow from operations of $171 million. And as a result, our cash flow conversion rate for the half year was a very pleasing 186%. And our strong balance sheet remains a key enabler of our markets and growth strategy and supports us in building a more diverse and resilient business. So I'll now hand you back to Zoran who will provide you with an overview of the outlook for our company.

Thanks Bill. Slide 11 shows relevant current and forecast Australian market conditions for our business. Pleasingly, as you can see, the sectors in which we operate continue to provide a positive outlook for both capital investment and operating expenditure over the next few years. Turning to slide 12, energy transition. Australia is undergoing a major energy transition, moving towards a decarbonised economy. At the same time, demand for energy is growing rapidly, partly impacted by the rise of artificial intelligence and the expansion of data centres. This represents a long-term opportunity that will play out over decades to come and which will require a significant level of investment. Monodelphus is well positioned to play a key role in this transition by leveraging our core and acquired capabilities and further developing new services across the sectors shown on the slide. Our recent acquisition of APIP expands our capability and supports our positioning in the HV transmission and distribution sector. You'll hear more about progress outlook or the progress slash outlook column on the next slide. We see this as the early phase of what is expected to be a strong long-term pipeline of opportunities. Moving now to the outlook on slide 13. Long-term demand in the resources and energy sectors is expected to remain strong. Supported by an improved global economic growth outlook, albeit against the backdrop of trade tariffs, geopolitical tensions and ongoing conflicts. High production levels across most commodities continue to drive demand for sustaining capital works and maintenance services. Iron ore prices remain firm, supporting current production rates and underpinning ongoing investment iron ore sector, with a continued focus on productivity to maintain competitiveness. The outlook for energy transition metals continues to strengthen, with battery metal prices recovering. Over the medium to long term, development in the mining and mineral processing sector, particularly for copper, other base metals and critical minerals, is expected to accelerate to meet growing demand, driving significant investment. The energy sector continues to offer substantial opportunities supported by gas construction projects and sustained demand for maintenance services. We remain well positioned to support customers across the full asset lifecycle, including late life operations and decommissioning. Australia's net zero emissions objectives continues to drive long term investment in energy generation, storage and transmission infrastructure. despite some constraints arising from planning approvals and network access. MonoELPIS is well positioned to capitalise on the energy transition opportunities by leveraging our broad service capability and expanding our high voltage service offering, whilst Environ is well placed to secure further wind farm and BEST projects. We will continue to support the resources and energy sectors decarbonisation programs working collaboratively with customers and third party energy providers to deliver a growing pipeline of opportunities. Pleasingly, our committed pipeline remains strong with more than $1.4 billion in new contracts secured since the beginning of the financial year. Following record first half revenue, full year revenue for FY26 is currently forecast to be approximately 30% higher than the prior year. with first half operating margins maintained. We remain committed to delivering quality earnings through a selective approach to new work, collaborative customer relationships, high standards of execution and a disciplined approach to the allocation of risk. Supported by a strong balance sheet, we will continue to build and leverage our enhanced delivery capability while maintaining the flexibility to pursue strategic opportunities that support long-term sustainable growth. In closing, I'd like to thank the entire Monad Alpha's team for their dedication and commitment, which are fundamental to our continued growth and success. I also extend my gratitude to our customers, shareholders and many other stakeholders for their ongoing trust and support. Thank you. I'll now hand over to the operator for any questions.

Thank you. To ask a question now, please press star 1 and 1 on your telephone and write your name to be announced. To withdraw your question, please press star 1 and 1 again. There may be a short pause while we compile the Q&A roster. We will now take our first question from the line of William Puck from Citi. Please ask your question. William, your line is open.

Hi. Thank you for taking my question, Rob, Zoran, and Bill. Perhaps the first question I had was just around how you're thinking about balancing, you know, one of the office's pursuit of revenue and earnings growth beyond the 526 and balancing that out with sort of productivity and productivity management. Just noted that, you know, your workforce have sort of stepped down in the last six months or so, but are you confident that there's sufficient headroom in your current workforce to perhaps deliver on another, you know, I guess, strong growth into FY27? Thank you.

Yeah, I think that's a fair point, Will. I guess the way we're thinking about it is, you know, with the top line or the revenue guidance which provided the 30% growth the previous financial year, and if you look at the growth profile over the last two years, it'll be in excess of 50%. So I think that'll prove challenging to deliver growth next year. I think recognising also that in the maintenance revenue result is a very strong result, and there is a component of work in there that's in the sustaining capital category that won't replicate in following periods. And in the EC numbers, very strong result. That'll be more a function of timing of project awards and the timing of customer commitments to projects going forward. So I guess that's a challenge we can balance all of that. But certainly we're seeing... I mean, if you think about it another way, the way I think about it, 50% growth over the last two years, I mean, that's essentially four or five years' worth of growth in a two-year period.

Thank you.

And then my second question is around how you're thinking about the margin profile beyond this year. Appreciate that you're expecting Are you expecting that to be sustainable as you move beyond 526? I appreciate that a lot of this has to do with the business mix, but just wondering whether that 7.6% is sustainable going forward?

Well, we're going to work as hard as we can to try and deliver on that. A couple of further comments. a significant volume and clearly volumes help with the amortisation of some of our fixed and semi-fixed costs. But the other point I'd make, which I said last year as well and probably supports this trend that we've seen in terms of margin enhancement or improvement over the last couple of years, we've got through this six-month period and aside from levels of activity being strong, our operational performance has been exceptional across the business. And that clearly supports a position on margin.

Thank you.

So in comparison to prior periods, has there been improvement in productivity or less of a cost pressure than what we've seen in the past? Might be reading too much into it, but just looking at your output slide, there's not a single dot point expressing sort of headwinds or any headwinds put up now. Just wondering if you're seeing higher productivity now versus six to 12 months ago or less of a cost pressure?

I think it's a combination of factors, but I don't think it's... component of the margin uplift to one element and if I was to, I'd go back to the point that I made just a little earlier around our performance in terms of execution of work has been not just strong but consistent across the business and that's always a significant driver of margin outcomes.

Thank you very much.

Thank you. We will now take our next question from Jacob Zakhanis from Jordan, Australia. Please go ahead, Jacob. The line is open.

Hi, Zoran. Hi, Phil. Congrats on a strong result. Can I just still stay on Will's focus on the EBITDA margins, please? It seems like there's a little bit of a change to how you guide us. I think that this is the first time that I can remember that you've given us explicit EBITDA margin guidance. What's giving you the confidence at the moment to provide that, please, Lauren? Is it a matter of the work that you can see in front of you immediately and then, I guess, to dovetail into your answer just before the productivity is still washing through the business?

Yeah, I think it's a function that, I mean, we talked about in the Outlook State the record level of work that we secured last financial year. So going into FY26, we weren't just in a strong position, but we had a little more clarity. And as work is progressing, we've got greater visibility than we've had. So we've got a higher level of confidence in marking a position around expectations around margins.

Understood. Thank you. And then just one, Phil, if I could, please.

Just on the CapEx intensity, obviously it's been bouncing around a little bit with some of the capital works that you guys have been doing from year to year. I note that the first half you were around 23 million of CapEx versus 14 mil for the full year of 25. How do we think about that one moving forward, please, Phil? Are we just investing for the growth that you see in the business at the moment or is there any fundamental step change there, please?

No, there's no fundamental step change at all. I mean, I think you have to look at it over a longer period of time, Jacob, rather than just a six-month period. I actually think it was a bit higher than the number that you quoted there. It's probably about 35 or something. But if the 30% growth on last year takes you to just short of $3 billion, I would expect our CapEx Would it be around that long-term 2% of revenue where it has been over many, many, many years? So it takes you to 60, 65. So sort of take the first half and double it. I wouldn't expect it to be any different from where it has been on a long-term running rate.

Thanks for that, Phil. And then I guess accompanying that, are we expecting a few extra million of depreciation in the second half just as that capital investment washes through, please?

I think comparing between the halves, I reckon there was probably a 5% or 6% increase in depreciation, and I would expect that number to be similar for the full year as well.

Thanks, guys.

Thank you. We will now take our next question from Branko Skocic from EMP. Please go ahead. Your line is open.

Good morning, guys, and congratulations on a really strong result. Obviously, iron ore sustainment work remains a key focus for the business, and listening to the majors, it does sound like they've still got a lot of work to come, particularly projects like Ministers North, the multi-year car dump of renewal at Port Edlin and so forth. So I'm just keen to understand, I guess, if you think we could sustain current iron ore revenue run rate So I guess just three to five-year period.

Yeah, I think you did a good job of articulating the opportunities. I think thematically, yes, I think we'll continue to see a program of larger sustaining capital projects in the portfolios of the majors as well as a couple of greenfields projects in the sustaining capital space. Yeah, port upgrades, you talked about car dumpers, balance machines, mines, more deep-watering programs and initiatives, and then be talking about specific mine developments in the Rio. With Rio, it probably looks like Rogue Valley, Goodadari, Rhodes Ridge a little further out. With BHP, you touched on Ministers North, Unity. That's probably the key opportunity. But it does look like, at this stage, it looks like a pretty strong portfolio of opportunities.

No that makes sense and I guess the second question just on the topic of labour I'd just be interested in any areas that you're seeing specific tightness at the moment obviously noting that the broader commodity complex has rebounded over the past six to twelve months as well. Yeah, sorry about that. Just on the topic of labour, I'd be interested in any areas that you've seen specific tightness, just noting, I guess, the broader rebound in the commodity complex.

I think the labour market's still pretty tight. The way I'd frame it is we've seen a slight moderation, but it's still generally tight. The depth of the labour pool, whilst there might be a few more people in the market, the depth of labour pool and the quality... hasn't necessarily improved materially. And there are certainly still quite a number of classifications and disciplines that are really, really tight. For example, electrical trades continue to be very tight.

But they're not an exception. I appreciate it. Thank you.

Thank you. We will now take a next question from Nicholas Rawlinson from Morgans. Please ask your question. Your line is open.

Hi, Dorian and Phil. Congrats on the result.

Just a couple from me. How should we think about the profile of maintenance revenue in the first half and the second half? Like, usually there's a skew to the first half, but it sounds like you had a few one-off HUC jobs, so just wondering how that will impact the profile.

I think the profile for the second half won't necessarily... I mean, it won't be dissimilar in the sense that Some of this one-off, non-repeatable work will continue for part of the period and turnaround activity looks pretty reasonable in the second half. So the thematic for me is more around FY27 in terms of a step down of revenue for maintenance.

Okay, that's helpful. Thanks, Zora. And just on awards, like it sort of feels like you've gone through quite a heavy recontracting cycle in maintenance and you've also won a lot of work in ANC, you know, the book to burn still above one. What does the award environment look like going forward over, say, the next six to 12 months?

Well, I think certainly in the shorter term, I'd expect that... see some more contract updates in terms of announcements in the maintenance space as well as the awards in or construction related awards as well that's it for me thanks guys it's a it's probably a more steady flow of awards than you saw in that you saw in the lead up to that christmas and early new year period we had a significant level of contract awards. I think it was $850 million of contract awards in a three-week period. You won't see that again, but it'll be more consistent steady.

Great. Thank you.

Thank you. We will now take our next question from John Patel from Macquarie. Please ask your question. Your line is open.

G'day, Zoran and Phil. Well done on the result. Just have a couple of questions. Thank you. Maybe just follow on from Nick's question there. Just in terms of the bidding pipeline, any sector shifts to call out, energy transition again features prominently in the presentation there. So we're seeing a bit of a migration maybe to that area and maybe away from that traditional iron ore, oil and gas area.

I think the opportunities are strong in that market, but you need to appreciate that we're building in our capability and our service offering in that market. So it will take some time to build a revenue profile for us to build a significant revenue profile in that market.

Thanks.

And add on to that, I mean, Zoran, in the past you've talked around some element of project delays and that's always inherent, but you're seeing sort of clients... more readily move forward with projects now than say six to 12 months ago?

I think if I went back six months ago there was certainly a burst of activity in terms of project approvals and proceeding. It'll be a timing issue. It's still taking time. I'd probably make the comment that it feels as a general observation it's early but does feel like a few of these opportunities are drifting a little.

And just the last question, if I may, just a question on margins. I know a couple of questions have been asked on this already, but I suppose the broad question is, do you still see an opportunity to improve margins in the medium to longer term? Obviously, there's a few moving parts within that, but how do you see that profile?

Yeah, so the question was asked earlier around factors contributing to margin and responded with, you know, we've got a little more visibility at the moment. There's some economies of scale. There's the mix of business in terms of BEC revenue growth. And we've certainly had, and I've said this twice already, we've certainly had really pleasingly consistent and strong performance execution delivery across the business. So, you know, I mean, absolutely, we've got aspirations. I'd like to grow the margins, but... We've got to work out to maintain the margin to live in the half year.

Thank you.

Thank you. As a reminder, before we take our next question, if you wish to ask a question now, please press star 1 and 1 on your telephone keypad. We will now take our next question from the line of Daniel Khan from CLSH. Please ask your question, Daniel. Your line is open.

Good morning, Soren. Sorry, good afternoon, Soren and Phil.

Soren, you mentioned earlier that we've probably seen 50% of growth in the past, that's worth about four or five years in the past two years. Just trying to reconcile that comment with what you've got on slide 11, which looks like industry charts after 2030 look pretty steady to growth. Should we sort of take that as your revenue side of things looking quite stable over the next few years?

I mean, we're trying to project out a long way. I think the reality is that that slide in terms of the YAT look, suggest that levels of activity across the different market sectors do look pretty strong, but a small increase in capex and spend. And the point that you made at the start of this, we've seen a tremendous amount of growth over the last two-year period. We've got to make sure that we can stabilise the business and continue to build off that and ensure we're not putting too much stress into the business

Yeah, it makes sense. And can you talk a little bit about your recent acquisitions, how they've performed, how they've integrated into the core business, and looking forward, any potential gaps in your portfolio at the moment that you'd be looking at in terms of M&A?

Yeah, so if you look at the high energy service business, it's been within the monos business for a six-month period. The integration is at the back end. It's tracking consistent with what we expected or the acquisition business case. In relation to ACIP and Kerman, essentially they're businesses that we've only acquired and completed in the last couple of months. So we're working through a process to integrate them and to start understanding how we can leverage the capability that those businesses have.

So their contribution has been very modest in the last couple of months.

In terms of the other part of your question, I think there are some areas more broadly we're looking at but I talked about the energy transition market and the size of the opportunities there and we're slowly building capability and services in that market. I think there are potentially some opportunities in that market going forward in terms of potential acquisition opportunities.

Thank you, Zoran. Just a last one maybe for Phil. Phil, in terms of cash flow conversion, obviously very strong in the period. Is there an element of seasonality? What's the sort of normalised level that we should be looking at?

No, there's no seasonality in it. If you look over a long period of time and average it out, we have 100% cash flow conversion rate, but it can swing quite a lot between halves. If you take this last half that we're reporting on now, I think the conversion rate was 186%. If you took the calendar year of 2025, the conversion rate is about 112%, I think it It really just depends on your level of advances that you may be able to negotiate on jobs, how and when they unwind, how you close jobs out. I mean, quite honestly, the biggest factor, and it is the most simple factor, is how your customers pay you around the reporting period end. If you get a big bill that is paid on the 30th of June as opposed to the 1st of July, it can make a big difference to the cash flow conversion rates in those periods. So there is very little seasonality in it at all. And the conversion rate always ends up being around that 100%, which is exactly where we want it to be.

One of the great things about being in contracting, you've got to allocate a lot of effort to manage it and very hard to forecast.

Excellent, guys. Congrats on a great result.

Thank you. We will now take our next question from Nathan Riley from UBS. Please go ahead, Nathan. Your line is open.

Yeah, thank you. Gents, can you just help me explain what happened with the headcount, just the reduction in staff numbers you saw over the last six months? I appreciate it's a point in time on both data points, but just what's going on there?

There are probably two elements to it, Nathan. One is, I don't like to use the term seasonality, but there is an element of that in terms of the workforce is casual in the Christmas and New Year period. They're not necessarily paid, so your numbers look a little wider. So it makes more sense to compare December periods to December periods. But having said that, in the last couple of months in the lead-up to December, we did have a couple of projects that were coming to the back end, so numbers were coming off on a couple of significant projects.

Gotcha. Okay. So I presume they're ramped up again, if we look at today's numbers?

probably holding at similar levels, maybe up a little. Okay. Final question.

Is there something we need to sort of consider in relation to maintenance margins? Now, I know you don't disclose those margins, but I'm just curious to get a sense on what's happening maybe under the bonnet in terms of the mix within your maintenance revenues at this point in the cycle Are you taking... Is there something going on there in terms of the way you price risk? Or is there a shift there just in terms of the nature of some of the maintenance projects, smaller sustaining capital projects?

I think that's an important point. When we talk about maintenance business and we talk about maintenance work, there's a spectrum there in terms of types of jobs ranging from pure maintenance, through to smaller sustaining capital projects and some of those will be fixed price projects. So you've got a real mix within the maintenance business as well and depending upon what the profile of that looks like has a little bit of an influence on the margin outcome.

Got it. Okay. Thanks very much.

Thank you. I'm showing no further questions. Thank you all very much for your questions. I'll now turn the conference back to Christy Glasgow for closing remarks. Thank you all for your participation today. That now concludes our briefing. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect your lines.