Shares in Perenti Ltd (ASX: PRN) are trading higher after the company announced that its underground mining subsidiary Barminco had won an $850 million contract with Bellevue Gold Ltd (ASX: BGL).
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Long-term body of work
The company said in a statement to the ASX that the contract would run for four years with the option to extend for another year.
The company said further:
The award follows a competitive tender process and marks the commencement of a new operating relationship between Barminco and Bellevue. The Bellevue Gold Project is a long-life, high-quality underground gold operation in a well-established mining jurisdiction and represents an important addition to Barminco's Australian portfolio. Under the agreed scope of works Barminco will provide all underground mining services to support the ongoing development and production activities.
Perenti said the contract would require about $75 million of growth capital to be spent.
Perenti Managing Director Mark Norwell said:
We are excited to partner with Bellevue as we focus on delivering enduring value four our clioents, our people, the communities in which we work and ultimately our shareholders. This contract award reinforces Barminco as a global leader in underground mining, further strengthening Barminco's underground mining portfolio and earnings in Australia. This award supports our strategy to deliver sustainable cash generation and future earnings growth.
Barminco also operates other mines in Western Australia, including the nearby Gold Fields-owned Agnew Mine, Regis Resources Ltd (ASX: RRL)'s Duketon underground mines, Ramelius Resources Ltd (ASX: RMS)'s Dalgaranga mine, and AngloGold Ashanti's Sunrise Dam Mine.
Bellevue Managing Director Darren Stralow said:
This was a highly competitive process, as shown by the strength of the tenders and the final result. Barminco presented an extremely attractive proposal across safety, operational capability, and technical expertise, positioning Bellevue strongly for the next phase of operational delivery and growth. Their depth of underground mining experience and global scale will further support Bellevue as the operation continues to mature and optimise.
Building on a solid base
Perenti has solidly grown its revenue over the past four years, from $2.43 billion in FY22 to $3.48 billion in FY25.
Guidance for the current year is revenue of $3.45 to $3.55 billion, EBIT of $335 to $350 million, and free cash flow of more than $170 million.
In a recent investor presentation, the company said that in addition to its Australian operations, it was expanding in the US, growing from zero projects in FY19 to eight currently.
The company also recently announced that Dr Vanessa Torres will commence as the new Managing Director on June 1, having previously worked at South32 Ltd (ASX: S32).
Perenti shares were 3.5% higher at $2.10 in early trade. The company is valued at $1.89 billion.
