Big River Industries (BRI) H2 2024 earnings summary

Executive summary

• Revenue declined 7.7% to AUD 414.7 million, mainly due to a soft residential market and site delays, partially offset by commercial market strength.

• EBITDA before significant items fell 36% to AUD 32.6 million, with margin at 7.9% as gross margin and volumes declined.

• NPAT before significant items dropped 62.8% to AUD 8.4 million; reported NPAT was AUD 8.1 million, down 63.8% year-over-year.

• Cash conversion remained strong at 98.2%, supporting a total dividend of 7.5cps at a 78.1% payout ratio.

• Acquisition of Specialised Laminators Queensland in May 2024 expanded capabilities and contributed to increased intangibles and fixed assets.

Financial highlights

• Gross profit margin declined 142 basis points to 26.0%, mainly due to lower frame and truss volumes and competitive pressures.

• Operating expenses rose 4.1%, with like-for-like costs up 1.3% amid inflationary pressures.

• Net debt increased to AUD 27.6 million, mainly from acquisition funding and contingent consideration payments; gearing ratio rose to 18.8%.

• Working capital to revenue ratio stable at 16.6%; debtor days improved to 42 from 43.

• Basic EPS was 9.6cps, down from 26.8cps in FY23.

Outlook and guidance

• Residential market expected to remain subdued for the next 12 months due to interest rate uncertainty and low building activity, with recovery anticipated towards late 2025.

• Commercial segment outlook remains strong, supported by solid project pipelines.

• Focus on growth in Queensland, Western Australia, and South Australia, leveraging market and regional diversity.

• Continued pursuit of strategic M&A and operational synergies to offset margin pressures.

• Emphasis on tight cost management, improving metrics, and investment in people, systems, and processes.