Downer New Zealand pushes up revenue, net profit in ‘challenging’ market conditions

Murray Robertson, Downer's chief operating officer for transport and infrastructure Photo / Michael Craig

New Zealand’s biggest listed infrastructure business has lifted revenue by 13% and net profit after tax by 6% and said storm repairs had boosted activity, despite challenging market conditions.

Australian-owned Downer New Zealand, which owns Hawkins, filed its accounts with the Companies Office for the year to June 30, 2024.

New Zealand storm recovery activity had partially offset harder times for the transport and infrastructure sectors, the business said, noting the change of government and re-prioritisation of infrastructure expenditure and project pipelines.

Downer EDI is dual-listed on the ASX and the NZX but doesn’t trade here.

In Australia, shares are trading at about A$5.51, giving it a A$3.7b ($4.07b) market cap. The AGM is to be held in Australia on November 20.

Downer New Zealand paid employees $804 million in wages and salaries in the 2024 year, up from 2023′s $763m, accounts filed with the New Zealand Companies office showed.

The group generates revenue from maintaining and managing transport infrastructure, utility infrastructure maintenance services in gas, power and water, maintaining and installing infrastructure in the telecommunications sector, and facilities management.

Downer NZ is part of the Link Alliance working on New Zealand’s biggest transport contract – the City Rail Link – with Vinci Construction Grands Projets S.A.S, Soletanche Bachy International NZ, WSP NZ, Aecom NZ and Tonkin + Taylor.

In the last few months, it left its New Zealand headquarters on Parnell’s Stanley St.

An Auckland Airport crane at work on "the stitch" – the construction that integrates the international terminal into the new domestic jet hub.

On September 16, Downer’s Hawkins won the $800m new domestic jet terminal contract at Auckland Airport.

Work is scheduled to be completed in 2029.

Murray Robertson, Downer chief operating officer for transport and infrastructure, in September told the Herald the works would be an “economic engine”, creating 2500 jobs at their peak and supporting many thousands more, especially in South Auckland.

Hawkins had worked collaboratively with the airport in an early contractor involvement (ECI) phase since February 2022 and is on site delivering an enabling work package for the domestic jet terminal under a separate contract.

The project will be delivered under a collaborative contract model with customer-supplied main design drawings, and includes three packages of work: a new headhouse, a new 240m gate pier and landside civil works.

Over the course of the five-year delivery programme, trade packages will be progressively prepared by Hawkins and tendered to the subcontract market on an open-book basis, Downer said.

Robertson previously said the two year’s work in advance of winning the contract were crucial.

“That helped the airport best position and frame up how they want to deliver it, getting input from us. The value of the ECI is it allows the client to take input in terms of constructability and the practical way of delivering things so they get best bang for buck,” he said in September.

But it wasn’t just the past two years that were key to that huge win.

“We’ve been working with the airport for around 40 years and have a long-standing relationship. This has been a project that is pivotal to the airport and is a turning point for all of Auckland, connecting the domestic and international terminals.”

In its 2024 results presentation to the ASX, Australia, Downer EDI said the wider business had A$38.5b work in hand. That meant a high proportion of secured revenue for FY25.

It cited improvement in risk profile and quality of work-in-hand through disciplined bidding and enhanced business review processes.

Anne Gibson has been the Herald’s property editor for 24 years, written books and covered property extensively here and overseas.