Electrical technology solutions company SKS Technologies Group (ASX: SKS) has secured several major contracts for electrical and communications infrastructure projects at the Australian Defence Force’s RAAF Base Tindal in the Northern Territory—the Air Force’s youngest operational base. The combined value of the projects is approximately $11 million.
This follows the Company’s national expansion strategy.
Chief Executive Officer, Matthew Jinks, said, “The significant investment made during 2022 to capture work in specific new geographical and market sectors continues to confirm its value in accelerating levels of new work in each targeted sector. The Northern Territory is one of our geographical target markets as is the Defence sector.”
SKS Technologies focuses on the design, supply, and installation of audiovisual/information technology, as well as electrical and communication products and services. The Company offers a range of solutions, including unified communications, SKS convergence, electrical and communication solutions, and communication networks.
Jinks added, “Since FY22, we have won $28 million of work in the Defence sector, a result that clearly supports our conviction in pursuing this work and our initial investment in acquiring the explicit knowledge and authorisations to win and undertake these projects. Furthermore, these three new contracts increase work on hand to another record level of just above $100 million, and we remain on track to achieve our stated revenue target of in excess of $120 million for FY24.”
In February 2020, the Federal Government announced a $1.17 billion upgrade to the RAAF base Tindal located approximately 320 km south-east of Darwin, near Katherine. The upgrade will deliver increased capacity, address issues associated with outmoded facilities and improve operating efficiency across the base’s facilities and infrastructure.
Having commenced in September of that year, works have now reached Stage 6 of the redevelopment, and SKS Technologies has secured three critical projects.
These projects include a site-wide communications project that involves the supply and installation of communications infrastructure, including optical fibre cable, SCEC communications racks and termination equipment for construction company Lendlease. A control and reporting unit facilities project will involve the supply and installation of electrical and communications equipment, including generators, fuel systems, inground pits and pipe infrastructure for the construction company Barpa.
Lastly, the Optech New Squadron Visiting Facility project will focus on the supply and installation of electrical and communications equipment, including inground pit and pipe infrastructure for McMahon Services.
In H1 FY24, SKS Technologies recorded a 20.1% increase in sales revenue to $53.69 million, translating into a 4.5 times increase in after-tax profit to $1.82 million. Its first-half EBITDA rose by 95% to $2.99 million from $1.54 million in H1 FY23. This follows several years spent executing an aggressive organic national expansion strategy to broaden existing capability and capture work in attractive new sectors.
SKS Technologies appears to have established the national footprint it sought. Given the level of demand and the backdrop of a more resilient national economy than was predicted over the medium term, its board believes that a more realistic revenue target for FY24 is in the vicinity of $120 million.
Alinda is a Business Reporter for The Sentiment
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