Macmahon Holdings Limited (ASX:MAH) Secures $463m Awak Mas Project
Project Details
Macmahon Holdings Limited (ASX: MAH) has been awarded a contract by PT Masmindo Dwi Area to serve as the mining services contractor for the Awak Mas gold project in South Sulawesi, Indonesia. This seven-year contract, with the option for a five-year extension, is set to commence in the first half of 2025, contributing approximately $463 million to Macmahon’s order book.
Financial Impact
The contract encompasses open cut mining activities, which include drilling, loading, hauling, and mine site development. To commence the project, key mining equipment will be deployed from the existing fleet, with growth capital estimated at $17 million allocated over the first four years. This capital commitment is part of the current growth capital target of $30 million annually.
Macmahon’s FY25 total capital expenditure budget remains at $230 million, incorporating a $30 million growth capital component. The company’s underlying earnings guidance for FY25 stands unchanged at AU$160 million to $175 million, with net debt expected to remain stable.
Executive Comments
CEO and Managing Director Michael Finnegan expressed his enthusiasm about the contract, stating, “We are delighted to be selected as the mining contractor for the Awak Mas gold project in Indonesia which presents a great landscape for us given our existing relationships.” He noted the significance of the project to the company’s secured work in hand and highlighted the collaborative efforts with PT MDA over the past year in fostering a strong partnership.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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