McConnell Dowell 2024 Financial Statements

for the year ended 30 June 2024 4 The Directors present their report on the company consisting of McConnell Dowell Corporation Limited (the Company) and its controlled entities for the year ended 30 June 2024. DIRECTORS AND COMPANY SECRETARY The following persons were Directors of McConnell Dowell Corporation Limited during the financial year and up to the date of this report: Directors S.V. Cummins, D.J. Morrison, A.H. Macartney Company Secretary D.J. Morrison PRINCIPAL ACTIVITIES The principal activity of the company is construction. There were no significant changes in the principal activities of the company during the year. CONSOLIDATED RESULT For the year ended 30 June 2024, the Group achieved a 27% growth in revenue to A$2.8 billion (2023: A$2.2 billion), mainly attributable to revenue growth in its businesses in Australia and New Zealand & Pacific Islands. The business continues to focus on specialised projects in Australia, New Zealand & Pacific Islands, and Southeast Asia, offering engineering and infrastructure solutions in the transport, water & wastewater, ports & coastal, energy, resources and commercial building sectors. KEY FINANCIAL HIGHLIGHTS IN FY24 • Revenue grew by 27% to $2.8 billion (2023: $2.2 billion). • Restoration of operational earnings by more than 100% to a profit after tax of by $50 million compared to a loss of $66 million profit in the comparative period. • Work in hand comparatively lower to $2.6 billion with $1.9 billion new work secured during the period. • Stable liquidity position with $233 million in the bank. All the business units exceeded budget cashflow with term debt fully settled in the current year. • Bonding & bank facilities available of $535.7 million ($466.7 million utilised) with dedicated support from our financial partners. • Preferred positions on prospects worth over $2.5 billion plus a further $3.0 billion live tenders outstanding. OPERATIONAL RESULT McConnell Dowell’s Australian business unit achieved a double-digit increase in revenue, however, recorded lower comparable operational earnings. The effects of the COVID-19 pandemic, continued global conflicts and the ensuing period of hyper escalation of costs have eroded margins on key projects entered into during this period. These higher costs are mitigated through the alliance model on key projects, which ensures that costs are reimbursed. The management of the business unit continues to focus on restoring margin on these projects. The New Zealand & Pacific Islands business unit reported an increase of 17% in revenue to A$305 million and a 29% increase in operating earnings to A$22 million compared to the year ended 30 June 2023. This marks the second consecutive year in which the business unit has operated above its plan. Similarly to the Australian business unit, work in hand fell in the period to A$339 million (2023: A$434 million). New project awards and changes to existing projects to the value of A$209 million were won in the year. The Southeast Asia business unit curtailed the substantial operating losses in the year ended 30 June 2023 (A$129 million loss), primarily from the BLNG contract, to record a modest operating loss of A$6.3 million for the year ended 30 June 2024. The BLNG project contract is now practically complete, with no further losses anticipated. The resumption of tendering activities, halted during the peak of COVID-19, has secured A$226 million of new work in the year. The approach to tendering is highly selective, within our disciplines and for clients who recognise the value we contribute. We continue to focus on reducing risks and working to improve margins on projects awarded prior to COVID-19. The Built Environs business unit increased its revenue by 83% to A$419 million as compared to A$229 million reported in the prior year ended 30 June 2023. This revenue growth is in line with the business unit’s growth agenda enabling the business unit to operate at scale across its three regions. Operating earnings of A$8.6 million, largely as a result of good project execution on key projects, is A$8.5 million higher than the prior period ended 30 June 2023. Work in hand fell by A$121 million from the reported highest historical value of A$564 million at 30 June 2023, however the business unit continues to pursue selective projects, with specific focus on the healthcare sector. Work in hand fell to $2.6 billion (2023: $3.5 billion) as a result of a slowdown in infrastructure awards in Australia and New Zealand, which is expected to continue into FY25, primarily due to the effects of cost escalations on our client’s available budgets. New projects to the value of $1.9 billion were won in the year. The business continues to focus on quality projects which will enhance the consistency of operational margins. The business also has $2.5 billion of preferred tender positions under negotiation, with a strong visible pipeline. While the Group has secured 86% of FY25 revenue, there are some complexities emerging, especially in its largest market, Australia. Recent government change at the federal and state level has led to a review of priorities and major projects. Investment in social infrastructure (schools, hospitals, public housing) is set to increase in key states such as Victoria and New South Wales, with some of this investment likely to replace transport infrastructure funding. Similarly, all regions are planning for the inevitable energy transition and future climate and water resilience investment requirements. The Group’s Horizon 2030 Strategy is aligned with these trends, and the business is well placed to participate in these next waves of growth. DIVIDENDS A dividend of $3.4 million (2023 – $15.8 million) was declared and paid during the year ended 30 June 2024 to the parent company shareholder. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS There were no significant changes in the state of affairs of the company other than that referred to in the financial statements and notes following. In addition to the items discussed under going concern and liquidity, refer to note 27: Events after the reporting period. INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS During the financial year the company indemnified and paid an insurance premium in respect of a D&O policy insuring the directors and officers of the group companies for certain liabilities and legal costs and expenses that may be incurred by those individuals in their capacity as directors or officers, to the extent permitted by law. The contract of insurance prohibits disclosure of the amount of the premium paid by the company. SAFETY AND ENVIRONMENTAL REGULATIONS The company is committed to the highest standard of environmental and workplace safety performance reasonably practicable. Directors' Report

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