NRW Holdings trading halt

NRW Holdings trading halt

Mining contractor NRW Holdings Limited (NWH) has announced a temporary trading halt following its FY25 results, which revealed a challenging year marked by weather issues and customer problems. Despite these setbacks, the company managed to post a positive core profit, largely in line with consensus estimates. The trading halt is a precautionary measure to allow the company to assess the market reaction to its FY25 results and to prepare for the upcoming FY26.

NRW Holdings' FY25 was tumultuous, with the South Australian government's administration of OneSteel Manufacturing and the subsequent voiding of the lease arrangement at the Port of Whyalla, resulting in a -$77m impairment. Additionally, mineral sands miner Strandline Resources (STA) went into administration, and unusually wet weather in Queensland disrupted coal mining. These issues led to a reduction in scope at Coronado Global Resources' (CRN) Curragh coal mine, impacting NRW's contracts. Despite these challenges, NRW managed to post a core profit, largely due to the inclusion of -$132m of trade receivable and contract asset impairments, primarily related to OneSteel and Strandline [1].

Looking ahead, NRW Holdings' FY26 is expected to see significant improvement across all divisions. The company's revenue was up 12% year on year, with earnings increasing by 20%. The Civil division, in particular, saw a 48% increase on a healthy margin of 5.4%, while the Minerals, Energy & Technologies (MET) division delivered a 50% increase on margins of 7.3%. The Mining division, however, was weak, delivering only 11% growth on a 7.9% margin, largely due to weather issues and churn in the portfolio. Analysts are confident that the outlook for FY26 is strong, with earnings margins likely to hold around 7% levels, assuming no material adverse weather/customer events [1].

Historical data suggests that NRW's earnings releases have not significantly influenced stock performance, with a maximum return of 8.65% observed during the period from 2022 to the present. `` The trading halt is a strategic move to allow NRW Holdings to assess the market reaction to its FY25 results and to prepare for the upcoming FY26. The company's strong order book and positive outlook for FY26 provide a solid foundation for its future growth. Analysts remain confident in NRW Holdings' prospects, with UBS forecasting 8% year-on-year earnings growth and a 14% increase in earnings per share. Citi, Morgans, and Macquarie also retain positive ratings on the stock, with consensus price targets ranging from $3.40 to $4.07 [1].

NRW Holdings' order book remains strong, with $4.2bn of work in hand and $2.9bn of active tenders. The company's Civil revenue is highly correlated with Rio Tinto's Pilbara replacement cycle, with Rio expecting to invest over $13bn in new mines, plant, and equipment in the region over the next three years. This replacement cycle is expected to benefit NRW, given its engineering capabilities and the acquisition of Primero in 2021. The company has already been awarded a significant contract at Rio's Hope Downs project [1].

References:
[1] https://fnarena.com/index.php/2025/08/27/nrw-holdings-happily-says-goodbye-to-fy25/