Announcement
HALFYR: SKL: Skellerup reports record 1H22 earnings
08:30am
SKL
17/02/2022 08:30
HALFYR
PRICE SENSITIVE
REL: 0830 HRS Skellerup Holdings Limited
HALFYR: SKL: Skellerup reports record 1H22 earnings
Skellerup announced today a record unaudited net profit after tax (NPAT) of
$23.2 million for the six months ended 31 December 2021 and provided full
year NPAT guidance of $44 to $47 million.
Key points for the six months ending 31 December 2021
o Revenue of $150.5 million, up 10% on prior comparative period (pcp)
o Earnings before interest and tax (EBIT) of $32.4 million, up 18% on pcp
o Industrial Division EBIT of $18.7 million, up 20% on pcp
o Agri Division EBIT of $16.7 million, up 9% on pcp
o Corporate costs of $2.9 million, down 12% on pcp
o Net profit after tax (NPAT) of $23.2 million, up 19% on pcp
o Operating cash flow of $19.7 million, down 44% on pcp
o Net debt of $25.6 million, up $16.9 million on FY21 year-end
o Interim dividend of 7.5 cents per share (an increase of 1.0 cps), up 15% on
pcp
o FY22 NPAT forecast in the range of $44 to $47 million.
CEO David Mair said he was proud of Skellerup's growth trajectory. "Our
consistently strong earnings performance is the culmination of years of hard
thinking about the essence of our business and making deliberate choices to
lay a foundation for future success. That essence is designing and developing
real solutions to predominantly original equipment manufacturer (OEM)
customers, and our unwavering focus on their needs."
Mair emphasised that both Agri and Industrial Divisions achieved record
results generated from revenue growth, whilst maintaining margins and
controlling indirect costs. "Growth was broad based, and strongest in US, NZ
and Asian markets, notwithstanding the impact of longer shipping timeframes,
material shortages, freight and material costs increases. In short, Covid-19
interruptions were successfully overcome by our people."
Mair added, "I am very proud of our people. Notwithstanding the difficult
challenges faced, our teams have continued to deliver the many essential
products we make for our customers across the world. We have progressed new
products along their development path, including launching some into market,
as well as starting new projects. We have kept our focus on where it matters
most, our customers and our employees."
Skellerup's Industrial Division achieved a record EBIT of $18.7 million, up
20% on pcp. Revenue grew by 12%, and earnings growth was broad based. "The US
market had the largest impact due to growth in potable and wastewater
products and marine foam. Roofing, electronics and health applications drove
growth in Asian and New Zealand markets", stated Mair. He added, "The
acquisition of Talbot Advanced Technologies in August provides a very good
fit for the Skellerup Group. It strengthens our capability and capacity for
health, technology and electronics applications".
Skellerup's Agri Division achieved a record EBIT of $16.7 million, up 9% on
pcp. Mair noted, "Revenue grew 7%, with dairy rubberware sales up,
particularly in the US market. Margins, however, were down slightly due to
the impact of increasing raw material prices and freight costs. The Agri
Division was also boosted by increased footwear sales across all markets, and
particularly in New Zealand."
Operating cash flow in the first half was down on pcp due to a planned
increase in inventory to mitigate the impacts of Covid-19. Mair said "We
increased raw materials and finished goods in transit to our distribution
centres to ensure continuity of supply to our customers. Net debt is up on
FY21 year-end because of the acquisition of Talbot and investment in working
capital. Skellerup's balance sheet remains very strong."
The record first half result meant that expectations are for a record Full
Year profit. Skellerup expects to deliver FY22 NPAT in the range of $44 to
$47 million. Mair said "We have strengthened our team with new appointments
in sales, product development and operational roles. These investments in
capability and capacity will support sustained future growth. We will
continue to manage the many disruptions caused by Covid-19, primarily in
international shipping."
Chair Liz Coutts said the outstanding first half earnings, and expectations
for the full year, allowed the Board to declare a 15% increase in the interim
dividend to 7.5 cents per share, imputed 50% (the same level as in the pcp).
"During the first half, Skellerup has once again demonstrated the strength of
our business, generating earnings from delivering critical products to our
(OEM) customers around the world. The Board is proud of the contribution of
our global team, especially given the ongoing disruption caused by the
pandemic. The Board is focused on supporting our people as we maintain our
strong focus on investing to grow sustainable earnings and shareholder
returns."
For further information please contact:
David Mair
Chief Executive Officer
021 708 021
Graham Leaming
Chief Financial Officer
021 271 9206
End CA:00387395 For:SKL Type:HALFYR Time:2022-02-17 08:30:37
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