With the global emergence of renewable resources, large-scale battery storage projects are playing a crucial role in enabling a sustainable future. Syncing with this commitment, Southern Cross Electrical Engineering’s (ASX: SXE) subsidiary SCEE Electrical, has been awarded a significant expansion of its role in the Collie Battery Energy Storage System (CBESS 1) project in Western Australia.
This expansion is a result of a contract variation awarded by Synergy, valued at approximately $50 million, adds the construction of the 330kV Switchyard to SCEE Electrical’s existing responsibilities under the Balance of Plant contract for CBESS 1 which was first announced on May 6, 2024. SCEE Electrical’s work will include a comprehensive range of tasks, including commissioning of critical equipment like transformers and circuit breakers and an overhead installation of line gantries.
To facilitate seamless connection to the Western Power network, this project scope includes an integration of a dedicated 330kV control room and a communications and SCADA system. Projected to complete in the second quarter of CY25 and this is a step forward in Western Australia’s shift to shape a sustainable landscape.
SCEE Group Managing Director Graeme Dunn said “I am very pleased that Synergy has awarded us this further package of work at what will eventually be one of the largest battery energy storage systems in Australia.”
“This brings the total value of work for us on this project to approximately $210m already, and I note there are many further battery projects to come here in Western Australia and in the rest of the country to support Australia reaching its net zero emissions targets.”
In May 2024, SCEE aimed at expanding its operational capabilities by acquiring MDE Group for $10.55 million. Founded in 2006 MDE, a Sydney-based company specialises in communications, data, and electrical services for construction projects across various sectors including commercial developments and data centres.
When acquired, MDE was set to deliver an FY24 revenue of $20 million and a normalised EBIT of about $3 million. In FY25, SCEE expects to be able to lift MDE’s EBIT to at least $5 million, supported by the current order book and near-term data centre opportunities, including projects recently secured by SCEE.
For the Half Year ended 31 December 2023, SCEE reported revenue of $255.6 million which remained flat compared to the previous corresponding Half Year. Similarly net profit after tax of $9.6m was also flat on the previous corresponding period.
Of its three core divisions – Infrastructure, Commercial and Resources – Infrastructure showed the biggest revenue gain over the period to generate $103.8m for the Half Year which was up $35m from $68.8m. However, these gains were offset by declines in Commercial down $3.6m to $78.9m and Resources down $31.3m to $72.8m.
As of December 2023, SCEE’s cash balance stood at $65.0 m, down from $77.7 m at 30 June 2023 and the Company remains debt-free.
Sidra is a Business Writer with The Sentiment
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