From JW Marriott’s Gold Coast Spa to Curtin University’s computer lab, Sydney-based national fit-out and construction services specialist SHAPE Australia (ASX: SHA) has worked on about 7,000 projects raking in $9 billion.
In keeping with that, the Company has kicked off FY24 strongly, with more project wins across its core business and three growth and diversification pillars. This, combined with its backlog of $343 million at the start of FY24, has positioned the business for a lucrative year.
In the first four months of FY24, SHAPE secured $291 million in project wins, up from $239 million in the prior year. The 120-day pipeline of opportunities now stands at $1.3 billion, an increase from the two-year average of $650 million.
SHAPE CEO Peter Marix-Evans said, “It is pleasing to have achieved a solid start to the FY24 year. We have observed significant momentum in core areas of the business in addition to our growth and diversification pillars. Buoyant tender activity has underpinned the $291 million worth of YTD project wins. There is a strong pipeline of approximately $656 million of projects we are currently tendering, which should support substantial further project wins in the first half of FY24.”
SHAPE is an Australian construction business with three decades in the industry. It has nine branches across the country and works with clients from various industries, including education, government, retail, hospitality and more.
The Company’s regional offices have locked in project wins, with the Gold Coast securing $13.5 million and Newcastle securing $7 million year-to-date (YTD), compared to $16.2 million and $9.1 million for the entire FY23. Additionally, the Company established a 2,000m² Modular facility in South Australia and began operations in August 2023, expanding its Modular capabilities.
SHAPE’s Modular business, strengthened by the acquisition of KLMSA in April 2022, integrated SHAPE personnel and a new General Manager. It has expanded nationally, securing projects in South Australia and New South Wales, focusing on the growing demand in South Australia.
Recognising the increasing demand in South Australia, SHAPE Modular has appointed a Modular Lead in Adelaide to establish a modular team and has successfully secured projects with organisations like Purple House in Coober Pedy and the Royal Flying Doctor Service in William Creek. Moreover, SHAPE feels that the Modular division is well-positioned for growth, with promising opportunities to increase revenues, particularly in the Education and Health sectors.
Matrix-Evans added that SHAPE’s critical areas of growth and diversification, including regional expansion and Modular, have realised solid YTD project wins, with a pipeline of opportunities identified.
In FY23, SHAPE’s revenue increased 31% to $862.4 million, with profit shooting up by 46% to $10.5 million. At the same time, its project wins remained essentially flat in FY22, amounting to $802.1 million.
SHAPE is not immune to the growing economic pressures nationwide, but its growing project pipeline for FY24 is helping relieve some of the stress on the Company and its shareholders.
Alinda is a Business Reporter for The Sentiment
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