An on-site death, legal disputes and global ambitions—Saferoads’s (ASX: SRH) FY23 has been eventful, to say the least. Based on its latest unaudited accounts for FY23, the road safety solutions company has survived its crash test financially. The Company generated revenue (excluding government grants) of $14.66 million, marking a 19% increase compared to FY22.
EBITDA reached $2.15 million, reflecting a growth of 12.3% from the previous year. Moreover, the profit before income tax almost doubled, reaching $128,000 when compared to the previous year.
The Company experienced a 17.5% rise in national product sales. Additionally, it achieved $920,000 in international product sales, primarily through the supply of 165 HV2 Barriers (approximately 1km), i.e. steel barriers, to North Dakota, USA. Furthermore, equipment rental revenue saw a 2.5% increase compared to the previous year.
Saferoads has strategically positioned itself to serve customers throughout the East Coast, having established branches in Victoria, New South Wales, and Queensland.
Moreover, Saferoads’ Rubber T-Lok, a crash barrier made of concrete and recycled rubber, has been officially approved for use across the East Coast. The barrier has received formal approval from key authorities, including VicRoads, Transport for New South Wales, and the Queensland Department of Transport and Main Roads.
The Life Cycle Analysis (LCA) of the product has been launched to evaluate the overall environmental advantages it offers. The assessment is set to be completed by early September. Saferoads, in collaboration with project partners, the University of Melbourne, and Tyre Stewardship Australia, was recently honored with the Victorian Award for Excellence in Technology & Innovation at the Concrete Institute of Australia Excellence in Concrete Awards 2023 for the Rubber T-Lok Barrier.
With the formal launch of the Rubber T-Lok product in the market, the company is now poised to secure its first orders in the near future.
On a more grim note, on November 26, 2021, an incident occurred at Saferoads’ Victorian Road Safety Rental premises, resulting in the unfortunate death of a third-party transport driver. Throughout the investigation process, Saferoads is working with the relevant authorities. The Company, along with its legal team, is currently examining the charges and the brief of evidence provided by WorkSafe. At this stage, no provision has been made in the financial report for any uninsured costs that may arise from the outcome of this matter.
As per its half-yearly report, the Company received six charges related to violations of sections 23 and 26 of the Victorian Occupational Health & Safety Act 2004. Although Saferoads has insurance covering such incidents, recent legislative changes in Victoria mean that regulatory penalties are no longer insurable. As a result, the insurance coverage is now restricted to legal fees associated with defending the charges.
Over the next two months, Saferoads will work with auditors to determine the most appropriate financial treatment of this incident.
In the meantime, the Company has been investing in R&D, finalising the Nova VMS and submitting the Ironman Hybrid Steel Wedge for approval. It is also working on developing a new permanent T-Lok Barrier for greater efficiency (and adoption).
Alinda is a Business Reporter for The Sentiment
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