DGL Group Limited (DGL) H2 2024 earnings summary

Executive summary

• FY24 revenue was flat year-over-year, reaching between AUD 465 million and $466.1 million, as volume growth offset lower commodity prices across divisions.

• Underlying EBITDA was $63.7 million, flat or down 1% YoY, while statutory NPAT declined 19% to $14.1 million due to higher finance charges, depreciation, and reinvestment in shared services.

• Gross margin improved by 6 percentage points to 43.1%, driven by procurement, product mix, and raw material price decreases.

• Cash flow from operations declined 37% to $37.3 million, mainly due to higher working capital, interest rates, and inflationary pressures.

• Five bolt-on acquisitions completed in FY24 contributed to growth, with a focus on integration and operational efficiencies.

Financial highlights

• Revenue reached up to $466.1 million, flat year-on-year, with a 32% CAGR since FY21.

• Gross margin rose 16% to $200.4 million (43% margin, up 6 points YoY).

• Underlying EBITDA was $63.7 million, flat or down 0.6% YoY, constrained by investments in growth and systems.

• Statutory NPAT was $14.1 million, down 18.9% YoY, due to higher interest and depreciation.

• Operating cash flow was $37.3 million, down from $59.3 million in FY23, with cash conversion at 86%.

• Operating expenses increased 26–26.5% YoY, mainly from headcount and inflation.

• Net assets increased 4% to $342 million YoY.

Outlook and guidance

• Strong demand expected across divisions, with environmental division remaining soft.

• Early FY25 shows stronger volumes in crop protection and stable demand in automotive manufacturing.

• Focus on extracting value from expanded capacity, integrating acquisitions, and leveraging operational synergies for FY25 profitability.

• New wastewater and liquid waste treatment facilities expected online in 2H FY25.

• Trading update to be provided at AGM in November 2024.