Why this FIFO construction firm ‘never loses a client’

“We go along for the ride, identify opportunities for our clients to reduce costs and increase the quality [of their businesses].”

This approach has won the company a string of bigger and bigger contracts for the likes of mining giants Newmont and Iluka Resources, and grain supply group CBH, propelling it to fifth overall on The Australian Financial Review Fast 100 list for 2024 off the back of a compound annual growth rate of 228 per cent.

In FY24 revenue surged to $79.4 million, up from just $28.7 million in the year before, as its pipeline of projects expanded from its west coast base across to the Pacific (serviced by a new office in Brisbane).

“Our growth has been built on quite small opportunities initially,” says Rielly. “Then through building relationships, our flexibility and operating model we’ve taken on new scope and our contracts have grown because of client confidence. Once we get a client, we never lose them.”

HTS Constructions’ niche is doing mining and agricultural projects in remote and difficult locations. It never does projects in capital cities or metro locations.

“We don’t do any projects that aren’t fly in, fly out,” Rielly says. Instead, it embraces the opportunity to solve complex logistical challenges and demonstrate its worth.

In the Tanami Desert in the Northern Territory, HTS Constructions has completed numerous projects for gold miner Newmont after winning the contract to expand a mining village from 300 to 415 rooms via the supply and installation of 29 prefabricated accommodation modules. It’s since built a bulk materials storage dome and installed critical electrical infrastructure for Newmont.

“We’ve gone from doing accommodation villages to now doing heavy industrial electrical and instrumentation installation, structural and mechanical piping, and major water infrastructure,” Rielly says.

HTS Constructions was founded in 2017 by Dan Hunt, a former electrical technician for the Australian navy, Blake Thackrah, a plumber with remote infrastructure and commercial project experience, and Kian Bullock, an Australian army veteran, engineer and project manager.

Their brainchild was to combine their trades and specialities to deliver all the aspects of complex construction projects.

The trio had become frustrated with the traditional subcontractor model – where a construction company is essentially a project manager and hirer of various tradies – and thought they could do it better by bringing it all inhouse.

While there are other construction firms doing projects in remote locations, HTS Constructions’ in-house delivery model is a key differentiator in the marketplace.

“If we need a capability, we build it, We don’t use subcontractors,” says Rielly, who joined the company as a director in October last year.

“We make sure we have the right resources, which is critical to our delivery of projects.”

This approach has shielded the company from the tradie shortages that have plagued other construction firms as big government infrastructure projects have sucked up skilled labour.

“Each of those three guys are very good at what they do. They prefer being on the ground with the teams, delivering projects,” says Rielly. “What they do not enjoy doing is running a more and more complex business [which is where I come in].

“When you go from revenue of $6 million to $80 million in three years, there are a lot of growing pains. So I handle things like compliance and systems.”

Hunt, Thackrah and Bullock are equal shareholders in the business, which has grown without the need for capital raisings or external investment. Instead, cash generated from bigger and bigger projects, has been reinvested into the business.

Amid a war for talent, HTS Constructions has “very low levels of regrettable staff turnover”, Rielly says. “We pay well, though not crazily. We have good benefit schemes, and we invest in training. We also encourage our employees to provide feedback to the company.”

He says HTS Constructions’ three-year strategic plan is to hit $200 million in turnover by 2027. “We’re also diversifying geographically to spread the risk.”

TradieSpec offers rent to own

Tim Cullen and business partner Matt Deeks came up with the idea of a specialist car hire company aimed solely at tradies after working at an accident replacement vehicle company.

“We realised there were no hire cars provided for tradies,” he says. “When they were involved in an accident, they were given a Corolla even though they had driven a Hilux kitted out with a toolbox, ladder rack and everything they needed. The replacement car just wasn’t doing the job, and it was critical to them earning an income.”

Alongside co-founder Richard McDonald, the trio established TradieSpec in 2018, which ranked 34th on the Fast 100 with a compound annual growth rate of 81 per cent.

The company, which now has a fleet of 700 cars and 22 staff, generated revenue in FY24 of $10.1 million, up from $6.1 million in the year before.

TradieSpec started out with a single Toyota Hilux listed for rent on classifieds website Gumtree.

“We got a call from a lady that lived down in Richmond, about 2½ hours from where we were based in Peakhurst in the Sutherland shire,” Cullen says.

They lent the car out to her, and three days later picked it up. “It had been completed totalled. There was a huge scratch. The tray was covered in hard concrete, and it was very dirty.”

From this initial failure, Cullen and Deeks realised they needed to come up with a proper business plan that included providing a “trade-ready” ute that came with insurance, servicing, maintenance and roadside assistance. This was offered as a “subscription-style” model with weekly direct debit payments.

“We worked out all the kinks and issues, and the rest is history as we started to build our fleet up,” Cullen says.

In the first couple of years, the co-founders self-funded the business, but when they started to run out of cash they sought backing from angel investors and people they knew. “After two years, we raised about $250,000 to give the business some runway,” says Cullen.

Having initially focused on offering flexible rental options and vehicle types, TradieSpec launched its most popular product, a rent-to-own offering where the user owns their vehicle outright at the end of a fixed rental period and where there is no need to secure finance or undertake credit checks.

“Our customers range from sole traders needing one ute to publicly listed construction companies and multinationals needing a fleet of 40,” says Cullen.

This year, TradieSpec expanded into Brisbane and Melbourne to become a national business. Cullen says a key lesson he and his business partners have learnt on the journey is the importance of maintaining positive cash flow.

“This is a very cash-thirsty business. We need enough capital to purchase [more inventory] to grow,” he says. “And make sure you maintain meticulous overview of your business financials.