Adjusted FY19 EBITDA and EBIT of $32.0m and $22.5m respectively was toward the low end of the guidance range, impacted by difficult conditions in the Construction segment where delays hurt margin. However, the order book has grown considerably and is made up in large part of recurring revenue streams from higher margin Asset and Mining Services segments. A pick-up in construction activity in coming periods would build significantly on this more consistent baseload. Although FY20 is likely to remain challenging in construction, we believe the business is well set up for a medium-term recovery and upgrade to BUY (prior HOLD) on a $0.55 valuation (prior $0.52).
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