Broadspectrum ups FY2016 earnings guidance

Detention centre operator Broadspectrum has upgraded its earnings guidance for the 2016 financial year, raising the stakes for its takeover bidder.

The company now expects full year underlying earnings before interest, tax, deprecation and amortisation to range between $265 million to $285 million, compared to the previous guidance of flat year-on-year earnings at $265 million.

"Our diversified portfolio has allowed us to withstand the cyclical nature of some of the sectors in which we operate better than most of our peers," Managing Director Graeme Hunt said on Monday.

"We're enjoying predictable and solid work volumes and we have a strong pipeline of future work opportunities," he added.

Broadspectrum, formerly known as Transfield Services, is the federal government's preferred bidder to operate the Nauru and Manus Island detention centres for another five years, which it has been operating since 2013.

A decision on the extension is expected in early 2016.

Mr Hunt said the construction and maintenance services firm is seeing increased volumes in the natural gas segment of its energy business, and expects increased demand for its well-servicing operations.

It is also expecting increased activity in the US refining and petrochemicals sector, and in the telecommunications sector in Australia and New Zealand.

The announcement comes on the heels of a second, $715 million takeover bid earlier this month by Spanish infrastructure giant Ferrovial.

The Spanish company, which was thwarted in its attempt to buy Transfield a year ago when the board knocked back a $2.00 per share offer, is currently offering $1.35 a share in an all-cash offer.

The Australian firm has said it will make a formal recommendation to shareholders in January on whether they should accept the offer or not.

At 1348 AEDT, Broadspectrum shares were trading 4.5 cents, or 3.54 per cent higher at $1.315 each.