Mining Services Giant Achieves Breakthrough Results
Perenti Limited (ASX:PRN) generated the best financial results ever on all key indicators in FY25. The international mining services company recorded a 4 percent growth in revenue, to reach $3.5 billion, up against FY24. The Company has operations in 12 countries and more than 10,000 employees all over the world.
The mining contractor demonstrated consistent growth trajectory over the past four years. EBIT(A) compound annual growth rate reached 23.7% during this period. Revenue compound annual growth rate achieved 12.7% over the same timeframe.
Revenue and Profitability Surge
The group had an underlying EBITDA of $668 million, which was a 4% growth year-on-year. EBIT(A) was at the $333 million mark, providing a 6% improvement in comparison to FY24. The EBIT(A) margin was extended to 9.6%, as compared to 9.4% in the previous year.
Underlying NPAT(A) hit $178 million, representing an 8% growth from FY24. The Company maintained its second-half weighting for earnings and free cash flow. This pattern delivered guidance expectations for FY25 and will continue in FY26.
Underlying earnings per share reached 19.1 cents, up 1% from FY24. Statutory earnings per share improved 19% to 12.9 cents. The effective tax rate remained stable at 32.2% for FY25.
Perenti’s revenue from FY22 to FY25
Cash Generation Reaches New Heights
Free cash flow achieved a record $286 million during FY25. The Company adjusted this figure to $195 million after accounting for equipment and inventory sales in Botswana. This normalised result still represents record free cash flow generation.
Operating cash conversion reached 99%, demonstrating strong working capital management. Net capital expenditure totalled $224 million, including $310.5 million in total expenditure offset by $86.5 million in sale proceeds.
Cash tax payments increased 14% to $83.1 million due to timing and increased profits. Net interest payments rose to $65.7 million, mainly from timing of coupon payments on 2029 Senior Unsecured Notes.
Underlying EBITDA and Free Cash Flow (FY21-FY25)
Debt Reduction Strengthens Balance Sheet
Leverage decreased to 0.5x, down from 0.7x in FY24. This reduction provided balance sheet resilience and flexibility for future growth opportunities. Gross debt fell 15.3% to $786 million at 30 June 2025.
The Company maintained liquidity of $850 million through undrawn syndicated debt facilities and cash holdings. Net debt repayment reached $173.9 million, mainly from US$100 million partial redemption of 2025 Senior Unsecured Notes.
Gearing ratio improved to 14% from 20.8% in the previous year. The Company repaid the balance of 2025 Senior Unsecured Notes in July 2025.
Dividend Returns Increase
Perenti declared a final dividend of 4.25 cents per share for FY25. Total dividends reached 7.25 cents per share, up from 6 cents in FY24. The Company also completed $25 million in share buybacks during the year.
The dividend policy targets a payout ratio of 30-40% of underlying NPAT(A). FY25 dividends reflected a 38% payout ratio, growing 21% compared to FY24. Since FY22, more than 75 million shares have been repurchased at an average price of $1.01 per share.
Contract Mining Maintains Stability
Contract Mining represents 72% of group revenue and 75% of underlying EBIT(A) before corporate costs. Revenue remained consistent at $2.519 billion despite project transitions. The division won over $4 billion in new work and extensions during FY25.
Projects included Mana and Obuasi in Africa, Agnew and Great Fingall in Australia, and Goldrush for Nevada Gold Mines in the USA. The scale advantage offset underperformance at the Botswana underground project. EBIT(A) margin improved to 11.4%, up 7 basis points from FY24.
Drilling Services Delivers Strong Growth
Drilling Services achieved revenue of $778 million, up 30% from FY24. The division benefited from full-year contribution of DDH1 businesses. EBIT(A) reached $84 million, representing a 66% increase.
EBIT(A) margin expanded to 10.8%, up 231 basis points from FY24. Production-related services maintained strong utilisation, particularly in gold and copper projects. Exploration drilling improved towards year-end despite remaining near cycle lows.
The division now ranks among the top three drilling companies globally. DDH1 and Strike Drilling lifted utilisation with further capacity for growth ahead.
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Mining and Technology Services Continues Turnaround
Mining and Technology Services achieved revenue of $193 million, down 5% from FY24. EBIT(A) reached $12 million, representing a 55% decrease from the previous year. The division represents 6% of group revenue and 3% of underlying EBIT(A).
BTP continued experiencing impact from idle rental fleet reducing revenue and earnings. Utilisation of rental fleet started returning towards normal levels during the second half. Supply Direct and Logistics Direct performed in-line with expectations for FY25.
The idoba underground mine simulation product launched to the market during FY25. Product development costs of $10.9 million decreased 27% from FY24.
Safety Initiatives Drive Cultural Excellence
The Company implemented multiple safety and cultural initiatives during FY25. Critical control verifications increased by 19% across operations. Front-line leaders received enhanced training and development programs focused on safety expectations.
Perenti installed area denial systems on jumbo fleets and radio-frequency identification detection systems on underground drill rigs. Automated rod handling trial systems were deployed on several drilling rig styles. The Company maintained its goal of no adverse physical or psychological life-changing events.
Work Pipeline Expands Significantly
Work in hand increased $1.4 billion to $6.5 billion following successful contract conversions. The pipeline of opportunities reached $17.4 billion across current operating regions. Gold projects dominate with $11.6 billion in pipeline opportunities.
Australia leads regional opportunities with $6.5 billion in pipeline prospects. North America follows with $5.9 billion in potential work. West Africa maintains $1.8 billion in pipeline opportunities. Copper projects represent $3.3 billion of the total pipeline.
FY26 Guidance Sets Growth Trajectory
Perenti provided FY26 guidance of $3.45-3.65 billion in revenue. EBIT(A) guidance ranges from $335-355 million. The Company expects capital expenditure of approximately $340 million and free cash flow exceeding $160 million.
Both EBIT(A) and free cash flow will maintain second-half weighting in FY26. The Company plans continued investment in people development and training programs. Increased capital expenditure will support earnings growth into FY27 and beyond.
