Chemical Industries Far East (C05) H2 2024 earnings summary

Executive summary

• FY2024 profit before tax was $5.665m, supported by a $9.8m fair value gain on investment properties; profit attributable to owners was $5.147m.

• Weak demand, lower chlor-alkali prices, elevated energy costs and raw-material supply disruptions weighed on chemical manufacturing.

• Business continuity was minimally affected by senior executive departures; second- and third-tier leaders maintained operations while a search for new leadership began.

Financial highlights

• Revenue was $72.583m versus $100.034m in FY2023; gross profit was $5.713m versus $6.929m.

• Profit before tax rose to $5.665m from $4.066m; profit for the year attributable to owners was $5.147m versus $3.554m.

• Net cash generated from operating activities was $4.809m, compared with $8.634m used in FY2023; cash and cash equivalents ended the year at $21.442m.

• Property, plant and equipment purchases were $11.861m, up from $5.755m; net cash used in investing activities was $11.838m.

Outlook and guidance

• Near term, losses in chemical manufacturing are expected to narrow; longer term, management expressed confidence in navigating the difficult phase.

• Regional chlor-alkali competition is expected to remain intense; priorities include trading, engineering services, operational efficiency, and organic and inorganic growth opportunities.

• Electricity costs remain high following the 2024 supply contract renewal and are expected to weigh on earnings for the next few years.