Nobody has told NRW Holdings Limited (ASX: NWH) that we are in a bear market.
The company just announced it has been awarded a $48 million contract for work at the BHP Group Ltd (ASX: BHP)-owned Olympic Dam operations.
NRW has a long history with BHP in the Pilbara iron ore mines, but this represents a first for them in the copper sector. BHP is the world's third largest copper producer, based on 2019 tonnages.
The company also announced yesterday that it was part of the consortium shortlisted to participate as 1 of 2 proponents in the RFP for the Bunbury Outer Ring Road project. This work is expected to cost $852 million in total.
Building the machine
This recent announcement caps a successful past year for NRW, which started with the February 2019 acquisition of West Australian engineering firm RCR Mining Technologies after it went into administration in late 2018.
This acquisition resulted in an award for $18 million to supply plant to the Rio Tinto Limited (ASX: RIO) Koodaideri project.
The company also announced on 9 December the completion of the BGC Contracting acquisition. This acquisition bought in an existing order book of $1.5 billion in mining contracts.
NRW is now a full lifecycle mining services provider. It is able to provide services from early civil works, to equipment, mine contracting, maintenance services, and finishing with civil remediation services.
On 23 December, the company announced the award of a $138 million project for the Fortescue Metals Group Limited (ASX: FMG) Eliwana project. On 5 February, it also announced the award of a $70 million bulk earthworks contract for Fortescue's Iron Bridge project.
Highlights from NRW's H1 earnings report (released on 2 February 2020) include a 55% increase to revenues, a $10 billion tender pipeline, and an impressive current order book of $3.8 billion.
What bear market?
The company's full year earnings report is going to be one of the few high points in a market filled with red ink due to the coronavirus.
This is because NRW's principal customers, the iron ore miners, are doing even better than they were before the market sell off.
Inexplicably, the NRW share price has lost 56% since the start of the year. It has been dragged into a market-wide bear market while the company is going from strength to strength.
Foolish takeaway
NRW is a company with momentum. It provides services to a sector currently untouched by coronavirus. In addition, it has demonstrated growth in earnings, plans to pay down debt, and a track record of winning work. In my view, NRW is one of the great value opportunities on the ASX today.
Like all mining companies it will tend to follow the mining cycles. But by growing diverse standalone capabilities, NRW has ensured continued high revenues. Even in bear markets like this one.
