Construction boom leads Scaffold provider Acrow to upgrade its guidance

Acrow Formwork and Construction (ASX:ACF) was one stock that gained today despite the ASX having another dour day, shedding over 2%.

The company provides formwork and scaffolding systems to construction entities across Australia and has 1,300 clients.

The broader construction sector has benefited amidst COVID-19 from government schemes and stimulus such as the HomeBuilder scheme and Acrow is reaping dividends from the boom.

Acrow previously tipped 20% growth in its earnings and 40% growth in its profit for FY22. But now it expects these figures to be at least 25% and 50% higher respectively.

The company also reported $12.8 million of secured hire contracts in the September quarter up 50% from the same quarter last year.

The standout state was Queensland in which it won several high-rise contracts. Tasmania, South Australia and Western Australia performed too – in Wthe latter state the company said it was generating the highest level of revenue in over 5 years

And even with the restrictions in New South Wales, it secured over $7 million in equipment purchase orders and labour hire contracts for the Snowy Hydro 2.0 project.

This project is an extension of the existing Snowy Scheme, which will be Australia’s biggest green energy project when complete in late 2024. It will involve the construction of 27 kilometres of tunnels to connect existing Snowy Scheme reservoirs.

The company said it expected these conditions to continue going forward.

“Acrow has now established itself as a key player in the market segments in which it operates,” said CEO Steven Boland.

“With the tailwinds of a growing transport infrastructure construction market and increasing recognition in the industrial services maintenance sector, we anticipate this strength to continue.”

Acrow shares on the ASX grew by over 10% this morning and are up over 20% in the last 12 months.