The NRW Holdings Limited (ASX: NWH) share price soared as much as 10% higher during morning trade after reporting a 49% increase in its full-year revenue. NRW shares have slowed down slightly this afternoon and are currently trading at $2.30 per share, 5.25% up on yesterday's close.
What were NRW's full-year highlights?
For the year ended 30 June 2019 (FY19), NRW reported a revenue increase of 49% on the prior corresponding period (pcp) to $1,126.3 million.
Comparative earnings before interest, tax, depreciation and amortisation (EBITDA) rocketed 54% on pcp to $144 million while net profit after tax before amortisation of acquisition intangibles (NPATA) climbed 19% higher to $40.4 million.
The biggest earnings drivers for NRW appear to be higher activity levels, improved productivity and increased fleet utilisation throughout the year as efficiency gains have flowed through to the bottom line.
On the balance sheet side, NRW increased its cash holdings to $65 million during the year and improved its gearing to 12.2% throughout FY19 as the company remains in a strong financial position.
Net debt remains broadly flat at $35.4 million as at year-end with net assets climbing higher to $291.4 million (versus $272.7 million in FY18).
Operationally, highlights for the group include the now-completed acquisition of RCR Mining Technologies for $10 million (paid for in cash) and new civil contracts for three WA-based iron ore producers.
NRW also said its agreement with Stanmore Coal Ltd (ASX: SMR) to extend its mining services activities has increased the contract value to $950 million with minimal new capital outlay.
Foolish takeaway
Investors liked what they saw in the results, with the NRW share price surging over 10% higher earlier this morning to be one of the top performers in the S&P/ASX 200 (INDEXASX: XJO) index.
In my view, NRW has done well to strengthen its balance sheet, including a significant debt restructure, while the earnings piece of the puzzle now appears to be in place.
NRW's Civil and Mining segments performed well throughout the year, despite lower margins in some work within the former.
Overall, it appears to be a strong result from the Aussie mining services group, without knowing the ins and outs of the business, and this appears to have been reflected in this morning's share price performance.
