Discover Saunders' 2023 Annual Report e-book. This interactive flipbook is created with FlippingBook, a service for streaming PDFs online. No download, no waiting. Open and start reading right away!
2023 Annual Report
Annual Report 2023 a
Contents At a Glance..............................................................2 Performance Highlights . .......................................... 4 Chairman’s Message . .............................................. 6 Managing Director and CEO’s Message .................. 8 Safety..................................................................... 10 Leadership............................................................. 12 People and Capability............................................14 Client Focus ........................................................... 16 Innovation.............................................................. 18 Sustainability.......................................................... 20 Engineering Construction . ..................................... 22 Civil........................................................................ 24 Asset Services.......................................................26 Automation. ........................................................... 28 Growth Markets.....................................................30 Governance, Financial Report and Other .............. 33
ABOUT THIS REPORT The Saunders 2023 Annual Report is a summary of Saunders International Limited’s operations, performance and financial position for the Financial Year ended 30 June 2023. In this report unless otherwise stated, references to ‘Saunders’, ‘Company’, ‘the Group’, ‘us’, ‘we’, and ‘our’ refer to Saunders International Limited. References to ‘year’, ‘Financial Year’, ‘2023’, ‘FY23’, or ‘FY2023’ all refer to the Financial Year ended 30 June 2023. All dollar figures are expressed in Australian dollars unless otherwise stated.
Annual Report 2023
Annual Report 2023 b
ACKNOWLEDGEMENT OF COUNTRY We acknowledge the Traditional Owners and Custodians of Country throughout Australia. We pay our respects to all First Nations peoples and acknowledge Elders past and present. As a business that works across many locations, we recognise and support their continuing connection to lands,
waters, cultures, languages, and traditions.
1
Annual Report 2023 1
At a Glance
We’re an integrated engineering construction and infrastructure company recognised for innovation and expertise in bulk storage terminal construction, piping, civil works, asset services and industrial automation. Regardless of a project’s size, complexity, value or location, our national team of over 400 are ready to respond to our customers and deliver to the highest quality and safety standards. We’re helping deliver a better future, today. We’re proud to work with some of the world’s largest oil and gas companies, tier-one construction contractors and across all levels of government. Our specialist teams are the greatest contributors to our success, combining deep sector knowledge with strong customer relationships to identify, optimise and deliver the ideal solutions across:
422
in our workforce
NINE metropolitan & regional offices
38
major projects in delivery
Defence
Oil & Gas
Infrastructure
Power & Water
FOUR
operational areas
Mining & Minerals
New Energy
Engineering Construction
Asset Services
We have metropolitan and regional offices located strategically across Australia, along with established operations in Papua New Guinea and a new presence in New Zealand. Founded in 1951, we’ve been listed on the Australian Securities Exchange (ASX: SND) since 2007.
Civil
Automation
2
Annual Report 2023
Annual Report 2023 2
KEY
Office locations Major projects in delivery
3
Annual Report 2023 3
Performance Highlights
In 2023, we produced a strong financial result with a record revenue and EBIT; Saunders’ fourth consecutive year of growth.
This year, we focused on our continuing strategic growth trajectory and delivering on that growth, providing attractive returns for our shareholders. In the last 12 months, we secured three projects with values in excess of $40 million each.
EBIT
Revenue
51.6% from $9.5m $14.4m Market capitalisation 11.6% from $108.1m $120.6m
Cash 65.1% from $36.7m $12.8m 54.5% from $130.0m $200.9m
Pipeline
Order book 4.2% from $192.9m at 30 June 2022 $201.0m at 31 July 2023 Annual dividend distribution
23.1% from $1.3b at 30 June 2022 $1.6b at 31 July 2023
Earnings per share (basic)
Full time employees 19.9% from 352 422 41.7% from 6.24¢ 8.84¢
46.5% payout from 3.0¢ 4.0¢
All comparisons are against Financial Year 2022 unless otherwise stated
4
Annual Report 2023
Annual Report 2023 4
MAJOR PROJECTS SECURED $44.4 million contract to deliver the Western Sydney International (Nancy Bird Walton) Airport Aviation Fuel Terminal for Multiplex in NSW Secured October 2022 $9.0 million contract to design and construct a new diesel storage tank for Park Fuels at Kooragang Island in Newcastle, NSW Secured October 2022 $8.5 million US Defence contract with Nova Nacap Joint Venture to design and construct two bulk liquid storage tanks in Katherine, NT Secured December 2022 $11.2 million contact with Port Macquarie Hastings Council to replace five existing timber bridges with concrete bridges, NSW Secured May 2023 $42.4 million contract to provide tank refurbishment and modification services for bp at its Kwinana Energy Hub in WA Secured June 2023 $9.3 million contract to deliver a new fuel storage tank at Ampol’s Lytton Refinery, located in the Port of Brisbane, QLD Secured July 2023 $44.1 million contract to expand diesel storage capacity at Quantem’s Pelican Point Terminal in SA Secured July 2023 ADDITIONAL HIGHLIGHTS Acquisition of Automation IT, expanding Saunders’ capabilities across industrial automation and technology solutions, following the acquisition of PlantWeave Technologies in 2021 Securing our Defence Industry Security Program (DISP) accreditation and finalisation of Federal Safety Commissioner (FSC) accreditation Strong safety performance with a Lost Time Injury (LTI) and a Total Recordable Incident Frequency Rate (TRIFR12 1 )metric of 1.68, representing a 13% improvement on 2022’s TRIFR12 of 1.93 1 TRIFR12 is the number of occurrences of injury for each 200,000 hours worked. 5
Annual Report 2023 5
Chairman’s Message
SAUNDERS INTERNATIONAL BOARD OF DIRECTORS Back row (left - right): Greg Fletcher, Mark Benson, Brendan York Front row (left - right): Timothy Burnett, Nick Yates
6
Annual Report 2023
Annual Report 2023 6
On behalf of Saunders’ Board of Directors, I am pleased to present the 2023 Annual Financial Report and provide shareholders with an update on our progress and achievements in the year. APPOINTMENT AS CHAIRMAN After serving as Chairman for 16 years, Timothy Burnett stepped down from the role on 30 June 2023, and I was privileged to assume the role on 1 July 2023. This change was a part of the ongoing board renewal process and Timothy continues to serve as a Non-Executive Director of the Board in the short term. Timothy has made an outstanding contribution to Saunders, and on behalf of Directors and shareholders, I would like to thank him for his long-standing commitment to Saunders and leadership of the Board for the past 16 years. SAFETY The Group and Board are committed to ensuring the safety, health and wellbeing of our workforce, subcontractors, and the community. We do this by investing in our safety culture, proactively managing the risks associated with our operations and continually reviewing Workplace Health and Safety Standards. In 2023, we delivered a strong safety performance which has been recognised by our clients and invested in proactive initiatives to keep our people safe and healthy in the years ahead. I’m also pleased to report the Group has secured new federal safety and security accreditations in the period. The Managing Director and CEO’s report will outline our safety performance in further detail. FINANCIAL PERFORMANCE Despite challenging global economic conditions, our financial performance in 2023 has been strong, with record revenue of $200.9 million, EBIT of $14.4 million and a solid order book of $201.0 million. This success reflects the Group’s ability to secure key new opportunities and repeat business with our clients, particularly as they seek to reposition existing and build new assets in the renewable energy sector. The Group continues to position for opportunities in its pipeline. Earnings per share for the period was 8.84 cents. The Financial Reports will outline our results in further detail.
STRATEGIC GROWTH While Saunders has a long history as one of Australia’s finest tank builders, our business continues to grow and evolve. We now have dedicated operational areas across Engineering Construction, Asset Services, Automation and Civil and are leaders in major projects for blue-chip and government clients across our key sectors. Our focus is now on fostering strategic growth, expansion into new regions and markets, and evolving our client offering as a one-stop multidisciplinary integrated team. At the same time, we are building our front-end, design engineering, tendering and operational capability to support this growth and position Saunders for future success, ensuring we continue to deliver with excellence while being competitive and profitable. SUSTAINABILITY We recognise Saunders has a unique opportunity and role to play in helping our clients to reach their sustainability goals. Working with major international organisations including bp, Ampol and Lendlease provides the ability to not only support them to achieve their bold sustainability targets, but to have insight into their plans to do so. We’re leveraging these learnings to define our own Environment, Social and Governance sustainability targets across the Group and I look forward to sharing our progress in these key areas. OUTLOOK The outlook for Saunders continues to be positive. Our growth strategy is on track, and we continue to deliver strong returns for shareholders. With strong orderbook and recurring revenues, we are well-positioned to deliver on the embedded earnings in our pipeline. In closing, it is an honour to have been appointed to lead the accomplished and dedicated Saunders Board of Directors this year. Together, we are committed to working with the Saunders Executive and Senior Management teams to build on the strong progress achieved in 2023 and to continue to deliver rewarding outcomes for shareholders, clients and our people in the years ahead.
Nick Yates Chairman Saunders International
7
Annual Report 2023 7
Managing Director and CEO’s Message
I’m proud to present Saunders’ Annual Report for 2023. I would like to extend a warm welcome to Nick Yates, who has assumed the role of Chairman, and express my sincere gratitude to Timothy Burnett for his 16 years of exceptional Chairmanship. SAFETY FIRST As Managing Director and CEO, ensuring the safety of our people, subcontractors, and the community is my number one priority. In 2023, we achieved a strong safety performance, with a Total Recordable Injury Frequency Rate (‘TRIFR12’) metric of 1.68 (compared to 1.93 in 2022) and received client recognition for our high safety performance in the period. This year we have taken significant steps to qualify under the Australian Government Building and Construction WHS Accreditation Scheme, which represents the highest workplace health and safety standards in Australian building and construction projects. Unfortunately, we recorded a lost-time injury this year after reporting a zero lost-time injury record for over 4.3 million hours in 2022. Moving forward, we are focused on fostering our safety culture and implementing new initiatives, such as our upcoming safety program that will roll out across the business in 2024. FINANCIAL SUMMARY Despite enduring macro market challenges such as supply chain disruptions, inflation, weather, and labour constraints, Saunders’ financial strength has continued to shine this year. I am pleased to share that we have achieved another year of record revenues and secured three major projects with values exceeding $40 million each in the last 12 months.
Mark Benson, Chief Executive Officer and Managing Director
8
Annual Report 2023
Annual Report 2023 8
(Left-right) Mark Benson, Managing Director and Chief Executive Officer and Timothy Burnett, Saunders’ Chairman for 16 years. Timothy elected to step down from the role in 2023 and is now Non-Executive Director.
GROWTH MARKETS Our focus remains on pursuing key clients and excelling in our core sectors while identifying opportunities in growth markets such as Defence, Water, and New Energy. Our ability to tender directly for larger government funded projects and compete at scale within the Defence sector is bolstered by the finalisation of our Defence Industry Security Program (DISP) and Federal Safety Commissioner (FSC) accreditations. We are actively pursuing projects in new regions, including New Zealand, and are reviewing opportunities for further geographic expansion. 2024 AND BEYOND As we embark on the new financial year, we have a strong operational platform, a strengthened executive and senior leadership team, and a continued commitment to our strategic initiatives. The outlook for Saunders and the markets we operate in is positive. We are well-positioned to leverage the significant pipeline of opportunities before us and continue on our growth trajectory. We are focused on delivering quality outcomes for our clients and safe outcomes with on-time delivery and on budget. This commitment will underpin the strength of our financial performance in the years ahead. Thank you to our shareholders for your ongoing support and to the entire Saunders team for your commitment and valuable contributions throughout 2023. I am genuinely excited about the year ahead and look forward to sharing the stories of our progress, our people, and our projects with you.
Our earnings have steadily improved for the fourth consecutive year through our disciplined approach to risk management during the tender stage and our exceptional project execution. This includes the work we performed on Project Caymus in Darwin up to the point in April, where our client’s own strategic reasons we were terminated for convenience from the project, despite being near the completion of construction of the 11 jet fuel storage tanks. While this has had a negative impact on our cash balance as of 30 June 2023, we anticipate this will improve upon finalising contract closure with our client in the coming months. PEOPLE AND CAPABILITY The collective energy, passion, and commitment to excellence exhibited by the Saunders team has been the driving force behind our performance in 2023. This year, we experienced significant growth, with our employee numbers increasing by 19.9% to support the delivery of our newly secured work, positioning our business for continued success. We have also invested in new executive and senior talent to enhance our in-house capabilities. We are now able to provide our clients a ‘one-stop shop’ for their projects after bolstering our capability across the Group and forming a multidisciplinary integrated offering. STRATEGIC ACQUISITIONS In May 2023, we welcomed Automation IT to the Saunders team, a specialist automation and control systems engineering business operating in the energy, water, defence and mining industries. This follows our acquisition of PlantWeave in 2021 and further expands our industrial automation and technology-based infrastructure offering for our clients who are increasingly moving towards technology-driven solutions. We continue to assess various opportunities to diversify and grow our operations and provide increased earnings to the Group and shareholders through acquisitions.
Mark Benson Managing Director and Chief Executive Officer Saunders International
9
Annual Report 2023 9
Safety
At Saunders, our core value of ‘Zero Harm’ forms the foundation of our safety culture and underpins our commitment to the wellbeing of our people, subcontractors, and the communities we operate in. It is our promise to our people and their loved ones, and our number one priority. By investing in our safety culture, proactively managing the risks associated with our operations, and continually reviewing Workplace Health and Safety Standards, we’re continuing to deliver a strong safety performance. We’re also continuing to invest in proactive initiatives to keep our people safe and healthy today and in the years ahead. Because we know we have no greater responsibility than to ensure everyone gets home safely at the end of their day’s work.
2023 HIGHLIGHTS
Achieved a strong safety performance, with a (‘TRIFR12’) metric of 1.68 This year’s TRIFR12 metric represents a 13% improvement on 2022’s TRIFR, which was 1.93. Unfortunately, we recorded a lost- time injury this year after maintaining a zero lost-time injury record for over 4.3 million hours in 2022 Received client recognition for our outstanding safety performance during this period Celebrated our team members that champion safety in the field through project- based awards Conducted a program of executive team site visits and engagement with team Utilised industry-leading safety equipment, including Powered Air Purifying Respirators (PAPR) welding helmets
Annual Report 2023 10
FEDERAL SAFETY COMMISSIONER ACCREDITATION
This year, we qualified for the Australian Government Building and Construction WHS Accreditation Scheme, the highest standard for workplace health and safety in Australian construction projects. This accreditation is facilitated by the Office of the Federal Safety Commissioner (OFSC) and is designed to improve workplace health and safety practices in our industry. We’re proud to have received formal Federal Safety Commissioner Accreditation on July 17, 2023. This will enable us to tender directly for larger government funded projects in the future.
is proud to be accredited under the Australian Government Building and Construction WHS Accreditation Scheme.
2024 FOCUS AREAS In 2024, our primary objective is to strengthen our safety culture, emphasising leadership behaviour and encouraging ownership of risk at all organisational levels. We are committed to investing in building our team’s capabilities to ensure a safer workplace, including the rollout of an upcoming safety leadership and attitudes program in 2024. We will continue to emphasise mental health, workplace culture and environmental compliance.
11
Leadership Meet the team that leads our business, working together to deliver successful outcomes for our people, clients, shareholders, and communities each and every day. Executive Management Team
Mark Benson Managing Director and Chief Executive Officer
Brett Gregory Chief Financial Officer and Company Secretary Brett is an accomplished financial leader and was permanently appointed Saunders’ Chief Financial Officer and Company Secretary in August 2023. This follows his initial interim engagement as interim Chief Financial Officer from 9 January 2023 and his appointment as Company Secretary from 28 February 2023. Prior to joining Saunders, Brett spent 18 years at Lendlease in various Executive and General Manager roles in Finance, including five years as the Chief Financial Officer for Lendlease’s Australian Construction business.
Angelo De Angelis Chief Operating Officer
With an executive career spanning over 30 years, Mark Benson is a seasoned leader in the engineering and construction industry. Prior to joining Saunders, Mark served as the General Manager of RCR Energy, a division of ASX-listed RCR Tomlinson. He also held senior executive positions with RICO, HIS Engineering, VRBT Group and major utility alliances including AGL, Origin, and NRG. Mark was appointed as Managing Director and a Director of the Saunders Board in 2015.
Angelo De Angelis brings a wealth of executive and industry experience to his role as Chief Operating Officer at Saunders. Prior to joining Saunders in 2021, Angelo worked at Ventia for over 25 years, including acquired organisations Broadspectrum and Transfield. In this time, Angelo held various senior and executive management roles in Australia and the US including Head of Strategy and Development, President - Transportation Infrastructure US, and Executive General Manager, Resources and Energy.
Annual Report 2023 12
Annual Report 2023 12
Senior Management Team
Trevor Walker General Manager, Growth and Innovation
Kala Notley People and Capability Manager
Claude Poffandi General Manager, Commercial
Rick Burke General Manager, Engineering Construction
Jonathon Bromilow General Manager, Saunders Civilbuild
Waleed Mansour Operations Manager, Asset Services
Eric Collins Operations Manager, Defence Programs
Robert Harvey General Manager, Saunders PlantWeave
Geoff Bladon General Manager, Saunders AIT
Frank Kraft General Manager, Business Development and Strategy
Wayne Mastello SHEQ Manager
Anthony Templeton General Manager, Operations Saunders AIT
Muhammad Sharim HSE Manager
Please note: Board Members biographies are featured on page 95.
13
Annual Report 2023 13
People and Capability
We’re recognised for our commitment to safety, collaborating with our clients to find new and smarter ways to support them, and coming together as ‘One Team’ – because we know we’re stronger when we work together to achieve our goals.
At Saunders, we strive to be an inclusive, flexible, encouraging and diverse environment for all our people. We invest in our people because we believe it makes our team stronger and better equipped to deliver on our promise of innovation, growth, and excellence. We’re passionate about giving back to communities where we work and to which we belong, both through our projects and as a part of broader group-wide initiatives.
2023 HIGHLIGHTS
Enhancing our employee benefits offering including development of learning and development capabilities and career progression strategies Launching an Employee Referral Program to boost our talent finding power Contributing to the community through fundraising challenges and charitable events Congratulating and rewarding our team from 5-40 years of service
14
Annual Report 2023
2024 FOCUS AREAS
Continued focus on developing, retaining and attracting talent, setting up our teams up to match our strong pipeline Implementing a new employee value proposition which includes benefits such as parental leave, wellbeing days, professional development opportunities and cost-of-living discounts Investing in continuous improvement in diversity and inclusion OUR VALUES Guiding our behaviours and underpinning our culture are our core values:
Zero Harm We are committed to the practice of Zero Harm behaviour at work and at home One Team We are better together when we collaborate with each other and our customers Excellence We commit to delivering excellence in everything we do Innovation We continually challenge ourselves to create innovative solutions for our customers Integrity We hold ourselves to the highest standards and deliver on our commitments Respect We act with respect to our people, customers, communities and the environment
15
Client Focus
Our clients appoint us to manage complexity, drive delivery, provide long-term strategic value, and develop innovative solutions. Together, we establish a foundation of trust and collaborate together to achieve excellent project outcomes, enjoying the journey along the way. We take pride in nurturing enduring partnerships, and our repeat clients are our ultimate performance indicator. Remarkably, we still work with clients who have been with us since the 1960s, including Mobil, bp, and Ampol. We’ve long been regarded as one of Australia’s best tank builders. However, as our business continues to grow and evolve, so does our service model. We’ve taken the time to listen to what’s most important to our clients, not only to meet their current needs but also to understand their future requirements. We’re investing in our front-end design engineering and operational capability. We’re proud to now be able to provide our clients with a one-stop multidisciplinary integrated offering across Engineering Construction, Civil, Asset Services, and Automation. The acquisition of Automation IT in 2023 will further enhance our capabilities across industrial automation and technology solutions and further enable our integrated service offering. We continue to expand into new regions and markets to support the business interests of national and international clients.
CURRENT KEY CLIENTS
Ampol
Ausgrid
Australian Department of Defence
bp
CPB
John Holland
Laing O’Rourke
Lendlease
Mobil
Origin Energy
Quantem
Seymour Whyte
Sydney Water
Thiess
TransGrid
Veolia
Local Government Councils across NSW
Viva Energy
Annual Report 2023 16
Annual Report 2023 16
PROJECT PROFILE Pelican Point Terminal Client Quantem Value $44 million Location Adelaide, SA Date secured July 2023 Operational Area Construction
CLIENT FEEDBACK
Now that works are complete, I would once again like to thank you and your team for all of the great work. The final weeks of the project saw many different activities being completed in a limited amount of time, all completed safely and to a high standard. Over the last couple of months we have seen all of the Saunders team roll up their sleeves and do what needed to be done to bring this project home. The end result was a product that we can all be proud of. Your management of the project has been strong throughout, working hard behind the scenes to ensure the best outcome for your client. Thank you. Project Manager Australian Fuel Major, QLD. June 2023
This project is a great example of the innovation and high‐quality, fast‐tracked results that can be achieved with early collaboration between client and contractor. In 2023, Saunders’ multi‐disciplinary in‐house engineering and operational teams worked closely with long-term and repeat client Quantem to value engineer, optimise constructability and conduct a full lifecycle analysis on a critical new project at Quantem’s Pelican Point terminal in Adelaide. Together, we were able to proactively manage risk and unlock extra value for our client as they looked to more than double diesel storage capacity at the site – it was a fantastic result and an impressive team effort. We announced the $44 million contract win in July 2023. The scope of work includes detailed design, procurement, construction, fabrication, installation, and commissioning of three 30,000 cubic metre diesel storage tanks and associated structural, mechanical and piping infrastructure, adding significant new diesel storage capacity for the fuel industry in South Australia. The project is supported by Quantem’s successful funding application under the Australian Government’s Boosting Australia’s Diesel Storage Program. Investing in Australia’s diesel storage capacity will help protect against future supply chain disruptions and will help the industry to meet new minimum stockholding obligations introduced as one of the measures in the Fuel Security Act (2021). This safeguard is essential for Australia’s energy security as diesel currently underpins our critical infrastructure, transport and industries, as well as the ability to respond to critical emergencies. Construction is set to begin on site in Q4 calendar 2023, with the site commissioned by Q2 calendar 2025. The project will contribute to Saunders’ revenue and earnings in 2024 and 2025.
17
Annual Report 2023 17
Innovation
Our operating model is underpinned by 73 years of construction and engineering expertise and further strengthened by our ongoing investment in innovation, pioneering of new world-class solutions. At Saunders, we’re focused on finding new and better ways to do things. In fact, innovation is one of our core values – it’s in our DNA. We’re focused on continual improvement, working with our clients and project partners to solve problems and create opportunities. These solutions, along with our learnings from developing them, are shared with our teams to support extended utilisation wherever possible.
CURRENT EXAMPLES
Leading the way in geodesic dome roof construction and installation We are the premier Australian contractor for constructing and installing geodesic dome roofs for storage tanks, with 12 roofs installed in 2023. In May, we successfully completed our largest-ever geodesic dome roof lift, using a 600-tonne crane to position the circa 52-tonne roof atop an existing 64-metre-wide tank. We are especially proud of our team for accomplishing this remarkable lift and are grateful for the positive feedback we received from our long-term client regarding this project. Using a unique tank jacking and rotating system on our projects We employ a unique system for constructing tanks when site conditions limit the use of traditional construction methods. We are the sole company in the region utilising the jacking and rotating system, which allows us to construct tanks from the top down, including the roof first, and then jack each completed strake into place. The jacking process for the tank enables simultaneous rotation of the entire tank, effectively creating a single work front for constructing the strakes, welding, and painting. This system significantly enhances productivity and safety, especially on compact sites where existing infrastructure precludes the use of traditional cranes and adjacent laydown areas in close proximity to the tank’s location.
Annual Report 2023 18
Annual Report 2023 18
We continually challenge ourselves to create innovative solutions for our customers
19
Annual Report 2023 19
Sustainability
We recognise that every decision and action we take is an opportunity to make a positive impact on the people and the world around us. We are proud to be a strategic enabler of our client’s bold sustainability initiatives and as we support them on their journey, we’re also learning and defining our own Environment, Social and Governance targets. We’re fortunate to be working with leading organisations including bp, Ampol and Lendlease, supporting them to not only deliver their projects, but also achieve their bold sustainability targets. We’re doing this through repurposing and repositioning assets, supporting carbon reduction initiatives, and aiding sustainable and ethical procurement. We’re also leveraging their plans and learnings as we embark on our own sustainability journey, focused on meeting the expectations of our people, our investors and our communities.
KEY FOCUS AREAS IN 2024
Environment Helping clients to achieve their sustainability targets. Growing our commitment to environmental sustainability. Setting our own carbon reduction targets and plan. Continued focus on environmental protection and enhancement. Social Creating value through our local and diverse supply chain. Engaging and respecting the communities we work in. Increasing procurement activity with Aboriginal and Torres Strait islander businesses. Investing in continuous improvement in diversity and inclusion.
Governance
Embedding sustainability in our decision making.
Building trust in our sustainable business practices. Advancing sustainable and ethical procurement.
Annual Report 2023 20
Annual Report 2023 20
OPERATIONS UPDATE
PROJECT PROFILE
Kwinana Renewable Fuels project Client bp
Value
$42 million
Location
Kwinana, WA
Date secured
June 2023
Operational Area
Asset Services
We’re particularly proud of our Kwinana Renewable Fuels Project win this year. Not only because it’s the largest project ever awarded to our Asset Services operational area, but also because of its bold sustainability ambitions. We’re refurbishing and modifying 25 tanks so they can be used for feedstock or biofuels storage, helping to repurpose bp’s former refinery site at Kwinana into a new integrated energy hub. The project plans to reutilise some infrastructure at the bp Kwinana site to produce lower-carbon fuel products that have the ability to support the decarbonisation of aviation and heavy industry. The project is subject to regulatory and State government approvals. The project commenced in July 2023 and will contribute to Saunders’ revenue and earnings from 2024 to 2026. The Kwinana project is the first of its kind globally for bp and a first for Australia. Our work will help bp produce sustainable aviation fuel and renewable diesel, supporting their net zero sustainability ambitions.
21
Annual Report 2023 21
Engineering Construction
Though Saunders boasts a rich history as one of Australia’s premier bulk liquid storage and geodesic dome construction contractors, our business has significantly evolved from its modest origins 73 years ago. Today, we stand as leaders in executing construction projects for blue-chip and government clients. We provide our clients with a scalable model and a multidisciplinary integrated team. The Saunders ‘one-stop shop’ draws from our pool of expert talent and resources to carefully guide the project from initial feasibility through to engineering and construction, commissioning and handover. Our scalable model provides us with the agility and flexibility to deliver projects of all shapes and sizes across our key disciplines, sectors, and regions. OUR SERVICES y Front End Engineering Design (FEED) y Structural Mechanical & Piping design y 3D drafting of large fuel terminals y Control system design and implementation y Network design and implementation y High Voltage and Low Voltage electrical design and implementation y Engineering, Procurement and Construction (EPC) & Engineering, Procurement, Construction and Management (EPCM) services y New tank builds for bulk fuel and chemical storage terminals y Water reservoirs and pumping stations y Tank Jacking technology (top down construction)
Annual Report 2023 22 Annual Report 2023 22
OPERATIONS UPDATE
PROJECT PROFILE
2023 HIGHLIGHTS
Western Sydney International (Nancy Bird Walton) Airport Client Multiplex
$44 million contract to deliver the Western Sydney International (Nancy Bird Walton) Airport Aviation Fuel Terminal for Multiplex in NSW (secured October 2022) $9.0 million contract to design and construct a new diesel storage tank for Park Fuels at Kooragang Island, Newcastle, NSW (secured October 2022) $8.5 million contract with Nova Nacap Joint Venture to design and construction two bulk liquid storage tanks in Katherine, NT (secured December 2022) Delivery of 11 jet fuel storage tanks with a capacity of 300 megalitres for the US Defence in Darwin, NT Significant progress at our $31 million Defence Fuel Infrastructure project for Laing O’Rourke, a part of the Larrakeyah Defence Precinct Redevelopment Program in Darwin, NT (due for completion December 2023)
Value
$44 million
Location
Luddenham, NSW
Date secured
October 2022
Operational Area
Construction and Automation
In late 2022, we were awarded a significant contract to build the aviation fuel terminal at the new Western Sydney International Airport, now also known as Nancy Bird Walton Airport for Multiplex. The project brings together an integrated Saunders team across both Construction and Automation, reinforcing our ability to leverage multi-disciplined solutions to deliver operational excellence for our clients. Our scope includes the design and construction of: y three aviation fuel storage tanks y the aviation fuel terminal’s mechanical piping, valves, pumps, filters, instrumentation, and controls y the aviation fuel terminal’s electrical services, including cabling and switchboards, SCADA electrical, and controls The project will contribute to our revenue and earnings in 2023 and 2024.
23
Annual Report 2023 23
Civil
PROJECT PROFILE
With over five decades of experience, our Civil team has earned a stellar reputation in the industry for our multidisciplinary approach to bridge design and construction. Beyond bridges, we excel in concrete construction projects, including wharves and jetties, foundation projects, culvert installations, and rail works. We are trusted by Tier-1 contractors for their complex and precision precast requirements. Our purpose-built precast facility specialises in pre-stressed bridge girders, Super T’s, and specialty precast items, with a production capacity of over 200 metres per day at full capacity.
Port Macquarie Bridges Project Client
Port Macquarie Hastings Council
Value
$11.2 million
Date secured
May 2023
OUR SERVICES y Road and rail bridge construction
We are proud to build upon our strong track record as trusted partners for Port Macquarie Hastings Council with a new contract. This project involves the replacement of five existing timber bridges with concrete bridges. The project is scheduled for completion over a 12-month period. Once completed, the new concrete bridges will reduce future ongoing maintenance costs for the Council and increase connectivity by allowing increased vehicle load limits. The project is being funded by Council and Transport for NSW under the NSW Government’s Fixing Country Bridges Program. The project will contribute to our revenue and earnings through 2023 and 2024.
y Marine structures y Precast fabrication y Concrete foundation systems y Manufacturing of complex Super T and planks for infrastructure projects y Excavation and installation of support structures y Road works
2023 HIGHLIGHTS
$11.2 million contract with Port Macquarie Hastings Council to replace five existing timber bridges with concrete bridges (secured May 2023) Significant progress on our biggest civil project to date: the delivery of precast Super T girders for the Sydney Gateway project, for John Holland and Seymour Whyte Successful completion of the Boston Street Bridge replacement in Boggabri for Narrabri Shire Council
24
Annual Report 2023
OPERATIONS UPDATE
We’ve earned a reputation for successfully delivering challenging civil projects using innovative design alternatives and construction methods, on time and to budget.
25
Asset Services Saunders are at the forefront of providing asset services, with a specialised focus on inspection, repair, modification, and maintenance solutions. Our expertise lies in reviving and revitalising our clients’ assets, enhancing their condition and availability, right through the asset’s lifecycle to decommission. We recognise the critical importance of timely rehabilitation and preservation of our clients’ assets and infrastructure and ensuring the uninterrupted flow of their business operations. Our expertise extends beyond the oil and gas, bulk fuels, power generation, mining, and resources sectors; we also excel in remediation projects involving bridges, marine structures, and water infrastructure. Our Asset Services work provides stable recurring revenues from long-term, blue-chip clients including Ampol, bp, Chevron, Mobil, Quantem, Viva Energy and Vopak. OUR SERVICES y Repair and maintenance of bulk liquid and chemical storage tanks y Asset management services y Industrial boiler work y Plant and facility shutdowns and decommissioning y Facilities maintenance y Shutdowns and upgrades y Structural Mechanical Piping installation y Pump and valve overhauls or replacements y Pressure welding y Electrical and automation upgrades
Annual Report 2023 26
Annual Report 2023 26
OPERATIONS UPDATE
PROJECT PROFILE
2023 HIGHLIGHTS
$42 million contract to provide tank refurbishment and modification services for BP at its Kwinana Energy Hub in WA (secured June 2023) Significant progress in mechanical modifications and supply and installation of two aluminium geodesic dome roofs at BP’s Bulwer Island fuel terminal, QLD with a total value of over $9 million Continuing delivery of our longer, cornerstone contracts, including year three of our five-year maintenance program for Mobil in Altona, Yarraville VIC with expected revenue of over $13 million in 2023 Continuing to support Viva Energy with their tanks maintenance program across Australia, currently executing maintenance projects in three locations, Gore Bay NSW, Newport VIC and Townsville Qld with a total combined revenue of $12 million Continuing our ongoing support for Ampol in both Lytton Refinery and Kurnell Terminal delivering large number of tanks modifications projects for a combined value of over $8 million in 2023
Viva Gore Bay
Client
Viva Energy
Value
$5.7 million
Location
Gore Bay, NSW
Date secured
July 2022
We’ve been trusted by repeat client Viva Energy to help maintain one of their important projects; 70-year-old Tank 6030 at the iconic Gore Bay Terminal on Sydney Harbour. The much-loved tank is getting some much-needed TLC. We’re replacing the floor and bottom strake and installing a concrete reinforced ring beam as part of our preventative maintenance program to ensure the tank continues to reliably service the Sydney market for many decades to come. At 36m in diameter and 14m high, Tank 6030 holds approximately 9,000m 3 of heavy marine fuel oil (50% of Gore Bay’s capacity), making it a crucial part of the infrastructure to supply the cruise ship market. Located in a challenging spot between a 17m high sandstone cliff to the West and the iconic Sydney Harbour to the East, a tower crane had to be utilised to access the difficult work front. Repairs are progressing very well and we’re estimating it to be ready just in time for the upcoming cruise season in early 2024.
27
Annual Report 2023 27
Automation
OUR SERVICES y Operational Technology y Industrial automation solutions y Networking and OT cybersecurity solutions - auditing and hardening to ISA/IEC Standards y Electrical engineering and control system design y Control system and telemetry upgrades y Electrical Panel manufacturing, testing and installation y Machine learning and statistical/physical process modelling y Functional safety of machinery - design and auditing y Asset and inventory management y Energy management systems and automated meter reading systems y Instrumentation selection, installation and calibration 2023 HIGHLIGHTS Automation IT acquisition In May 2023, we welcomed Automation IT, a specialist automation and control systems engineering business operating in the energy, water, defence and mining industries to the Saunders team. This follows our acquisition of PlantWeave in 2021 and further expands our industrial automation and technology- based infrastructure offering for our clients who are increasingly moving towards technology driven solutions. Automation IT and PlantWeave have commenced the integration of their team and operations to form Saunders Automation. y Plant commissioning y Process optimisation y Preventative maintenance y Data centre monitoring
As our clients increasingly embrace technology-driven solutions for their infrastructure and operations, we ensure that their projects and facilities operate at peak efficiency, productivity, reliability, and safety through our specialised industrial automation services. Our team excels at auditing and streamlining processes, integrating Information Technology (IT) and Operational Technology (OT) systems, boosting output, enhancing efficiency, and ensuring overall process quality, enabling our clients to achieve key production goals. We provide cutting-edge automation and energy management services to commercial, industrial and data centre clients. Our services include round-the-clock emergency support, cybersecurity, continuous control system enhancements, troubleshooting, maintenance, remote monitoring, as well as intuitive and tailored dashboard and reporting solutions. The acquisition of Automation IT will accelerate Saunders’ market expansion into Industrial Automation and Control Systems, building on our acquisition of PlantWeave in 2021.
Annual Report 2023 28
OPERATIONS UPDATE
PROJECT PROFILE
PROJECT PROFILE
Gatton Prison complex infrastructure Client Confidential
Barangaroo South
Client
Lendlease
Location
Barangaroo, NSW
Location
Gatton, QLD
Operational Area
Saunders PlantWeave (now Automation)
Operational Area
Automation IT (now Automation)
Lendlease has trusted our expert industrial automation team at Barangaroo South, Australia’s first carbon-neutral precinct, since it was first constructed in 2015. We’ve successfully delivered the OT solutions that not only provide chilled water for air conditioning, but also critical real- time analysis and automated system responsiveness, ensuring the precinct continues to achieve carbon neutral and water positive outcomes. We continue to expand, optimise and support this incredible y High Voltage Embedded Electrical Network y Implementation and monitoring of an ISA/IEC 62443-based Cybersecurity Solution Currently, we are engaged in full electrical, instrumentation, and controls, as well as mechanical commissioning, to expand the DCP to service the residential towers at One Sydney Harbour. subterranean infrastructure across the: y 62MW District Cooling Plant (DCP) y Recycled Water Plant
Our Gatton Prison complex infrastructure project is a crucial component of the Southern Queensland Correctional Precinct, a two-stage expansion and upgrade initiative. The project includes the construction of a new 1,500-cell, high security facility for male prisoners in Gatton, in order to address growing demand for correctional facilities in Queensland over the next three to five years. We were appointed to deliver the design, supply, programming, testing and commissioning of power Network Control System, generator control and Energy Management System and Sewage Treatment Plant control system. We are able to provide a diverse range of technical solutions to handle all the power, water and sewage control requirements.
29
Growth Markets Our focus remains on pursuing key clients and excelling in our core sectors while identifying opportunities in growth markets such as Defence, Water, and New Energy. We are actively pursuing projects in new regions, including New Zealand, and reviewing opportunities for further geographic expansion.
DEFENCE We’re seeing direct outcomes and significant progress following investment in our Defence sector strategy and specialist resources this year. In December 2022, we were awarded a $8.5 million project by the Nova Nacap Joint Venture in the Northern Territory. Our ability to tender directly and compete at scale within the Defence sector has been bolstered by securing our Defence Industry Security Program (DISP) accreditation and finalisation of Federal Safety Commissioner (FSC) accreditation. We are well-positioned to benefit from increased momentum and spend in the Defence sector as projects are brought to market in early 2024. WATER Saunders has a long history in the design, construction, and maintenance of bulk water storage tanks and reservoirs. In 2023, we were appointed to design and construct a two-megalitre column-supported tank for Fulton Hogan in Victoria – considered a core service offering for our organisation. However, our capability in the water sector has grown following the recent acquisitions of PlantWeave and Automation IT, and formation of our Automation business unit. This additional capability and client offering, along with increased capital investment in the sector, have heightened our focus on this market. We are well-positioned to secure a new Government- funded water project in Queensland, to be formally awarded in early 2024.
Annual Report 2023 30
Annual Report 2023 30
NEW ENERGY Fuelled by technological advancements and a growing global sustainability movement, the new energy sector is rapidly transforming the global energy landscape. Several clients are increasing their attention to this sector, not only because it addresses environmental concerns, but also due to governments’ heavy investments in renewable energy projects, which present economic opportunities, foster innovation, and create jobs. We’re currently working with several fuel majors, energy majors and key clients, including bp, Ampol, and UGL on new energy projects and anticipate significant future growth in this sector. GEOGRAPHIC GROWTH We currently have a strong geographic presence across New South Wales, Queensland, Victoria, Western Australia, South Australia, Northern Territory and Papua New Guinea. We’re building a new presence in New Zealand and will explore additional regions to follow key clients and opportunities when they align with our strategic direction.
PROJECT PROFILE
Nova Nacap
Client
Nova Nacap Joint Venture
Value
$8.5 million
Location
Katherine, NT
Date secured
December 2022
Operational Area
Construction
Our scope of work for this project includes the design and construction of two 4-megalitre aviation fuel tanks at RAAF Base Tindal in Katherine, NT. It is subcontracted through the Nova Nacap Joint Venture, which is contracted to the Naval Facilities Engineering Command (NAVFAC) Pacific, US Department of Defence. The project continues to strengthen our relationship with the repeat client Nova Nacap, while also enhancing our capability and track record within the Defence sector. This project will contribute to Saunders’ revenue and earnings through 2023 and into 2024.
31
Annual Report 2023 31
Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35 Page 36 Page 37 Page 38 Page 39 Page 40 Page 41 Page 42 Page 43 Page 44 Page 45 Page 46 Page 47 Page 48 Page 49 Page 50 Page 51 Page 52 Page 53 Page 54 Page 55 Page 56 Page 57 Page 58 Page 59 Page 60 Page 61 Page 62 Page 63 Page 64 Page 65 Page 66 Page 67 Page 68 Page 69 Page 70 Page 71 Page 72 Page 73 Page 74 Page 75 Page 76 Page 77 Page 78 Page 79 Page 80 Page 81 Page 82 Page 83 Page 84 Page 85 Page 86 Page 87 Page 88 Page 89 Page 90 Page 91 Page 92 Page 93 Page 94 Page 95 Page 96 Page 97 Page 98Made with FlippingBook - Online Brochure Maker