SGH boss Ryan Stokes on the lookout for deals after posting bumper $655m profit

Ryan Stokes says industrial giant SGH remains on the hunt for takeover deals in the aftermath of a $15 billion Bluescope bid earlier this year.

The SGH chief executive also warned east coast manufacturers against “cheap shots” about gas pricing but was confident there would be a “constructive pathway” forward on the Federal Government’s hotly-debated proposal for a reservation scheme.

ASX-listed SGH posted a statutory profit of $655 million in the year to June, up more than 30 per cent on the 2025 financial year.

That was particularly driven by rising earnings at construction materials company Boral, which were up 14 per cent.

Mr Stokes signalled his interest in steel-maker Bluescope remains after the $15b February takeover proposal was knocked back, adding that SGH would run the ruler over other industrial businesses.

Net debt fell 12 per cent to $3.7b and Mr Stokes said that “deleveraging” would pave the way for growth opportunities.

“Our balance sheet would enable us to take on a sizeable growth step, an acquisition,” he said.

“We’ve got capacity to add from a financial perspective and operational perspective.”

He said Bluescope “would’ve been a neat fit” thanks to broader themes boosting industrial businesses like Boral, which include a big pipeline of construction and infrastructure work.

“There’s a number of companies that would fit. It will just be the right situation and timing,” Mr Stokes said.

Boral’s revenue lifted 5 per cent to $3.8b. SGH took full control of the cement, concrete and asphalt supplier in mid-2024.

WesTrac revenue dipped 6 per cent to $5.8b yet earnings improved.

SGH expects about $1.7 trillion of spending on infrastructure and construction work across the country over the next five years, boosted by the Federal Government’s home-building target.

In energy — where SGH has a 30 per cent slice of oil and gas producer Beach Energy — Mr Stokes said the domestic gas sector was “threatened” and “vulnerable” under the Federal Government’s proposed reservation scheme.

That policy will require exporters across the country to pump 20 per cent of production into the local market regardless of demand. It was largely driven by concerns of a shortfall in the east coast wholesale gas market.

“I understand there’s a need to do something to ensure (businesses) accessing the wholesale gas market can have reliable long-term contracts,” he said.

“There’s a role for LNG producers to play into that. There is a constructive pathway that works for all parties.”

He stopped short of urging manufacturers in need of gas to stump up their own cash to fund exploration work but said critics needed to understand the risk and cost of developing energy projects.

“We have (invested in new supply), not because we needed to, but because we thought it was sensible,” he said.

“If you’re not prepared to put money up and understand the risks involved with bringing gas to market, its pretty easy to take cheap shots and say ‘I want something cheaper’.”

Manufacturers have long been pushing for the reservation policy as it will push down input costs. But oil and gas companies say driving down the price of gas too far will worsen shortages by forcing local producers out of the market.

SGH holds a 20 per cent stake in Southern Cross Media, which owns WA Newspapers, publisher of The Nightly, The West Australian and The Sunday Times.

Mr Stokes is a director of Southern Cross.