Marine & Civil Maintenance
Marine & Civil Maintenance (MCM) is an industry leader in the repair and maintenance of complex infrastructure assets throughout the Pacific, operating across sectors including water, transport, marine, buildings and industrial and mining.
Need
To secure contracts, MCM is often required to provide bank guarantees, which puts pressure on its working capital and cash flow during the critical early stages of each project.
Solution
We provided bonds to help MCM free up its capital to cover the costs of hiring staff and purchasing equipment required to prepare for and undertake its projects.
MCM occupies a unique space in the infrastructure sector. It undertakes specialist maintenance and repair work with a particular focus on wharves. As its works on wharves are often linked to the facilitation of exports, we were able to support with bonds to secure its contracts.
For more than two decades, MCM has conducted vital upkeep on major infrastructure assets. The bulk of its work relates to wharves, but the business also helps to maintain bridges, local government assets, water infrastructure and sea walls.
Much of this work is directly tied to Australia’s success as a global exporter. The wharves and other port infrastructure MCM maintains facilitate the shipment of goods, helping other Australian businesses reach new markets.
In 2022, MCM began its own major export journey after winning a contract with Fiji Ports to repair some of the country’s wharves.
Export Finance Australia’s support frees up our capital to grow our business.
Nick Critchley
Managing Director, Marine & Civil Maintenance
Navigating cash flow constraints
Securing the contract for this infrastructure project required MCM to pay a sizable security bond upfront. Bonds like these serve as a guarantee that the work will be completed to a satisfactory standard.
MCM Managing Director Nick Critchley explained that these guarantees can put a strain on cash flow and capital, especially in the early days of a project when significant upfront procurement expenditure is being made.
“We have been in a position where for every dollar for a bank guarantee we needed to provide, we needed to provide equivalent cash cover, which is not ideal when you’re commencing a project,” he said.
During conversations with other businesses that had already broken into the Pacific region, Nick was recommended to connect with us for support with security requirements.
If you’re in a business that has ties to export, it's certainly worth investigating the services offered and having an initial conversation with the team at Export Finance Australia.
Nick Critchley
Managing Director, Marine & Civil Maintenance
Financial support here and abroad
MCM’s domestic work is tied directly to the capacity of Australian businesses to export, which meant we were able to provide a variety of financial solutions to support a range of its projects across Australia and in the Pacific – a fact Nick was unaware of until speaking to us.
Since then, we’ve worked closely with MCM to provide bank guarantees to support wharf contracts around Australia. With minimal cash cover required for the bonding solutions we provided, this helped free up MCM’s cash flow.
“A large proportion of our business is repairing wharves, and with ports having an export link, we've been able to get support from Export Finance Australia to provide our clients with the bank guarantees, which act as security for our performance of the works – this has been really important for our business.”
Without having working capital tied up in bank guarantees, Nick said the business has been able to build its presence in the Pacific and is beginning into make inroads to other markets within the region.
“There is less reliance on securing parts of the guarantee with our cash when working with Export Finance Australia, which frees up our capital to grow the business. We're certainly on quite a growth path as a business, making management of our cash flow ever important.”
Looking forward, MCM is exploring opportunities in other pacific regions.
