Elders (ELD) H2 2024 earnings summary

Executive summary

• FY24 marked the first year of the fourth Eight Point Plan, with a challenging Q1 but improved conditions and operational discipline in later quarters.

• Delivered resilient results amid difficult market and cost conditions, with EBIT near the midpoint of guidance at $128.0 million.

• Diversified business model and geographic spread supported earnings despite market volatility.

• Announced the acquisition of Delta Agribiz for AUD 475 million, fully aligned with strategic goals and expected to be EPS accretive pre- and post-synergies.

• Continued focus on safety, sustainability, and cash flow, with strong progress in transformation initiatives and system modernization.

Financial highlights

• Sales revenue declined 6% year-over-year to $3,131.3 million, but gross margin increased by 3% to $637.6 million, driven by acquisitions and new business.

• Underlying EBIT for FY24 was $128.0 million, down 25% year-over-year, mainly impacted by a weak Q1.

• Underlying NPAT dropped 38% to $64.0 million; statutory profit after tax decreased 55% to $45.1 million.

• Final dividend declared at 18.0 cents per share (70% franked); total dividends per share for FY24 were 46.0 cents (30% franked), down 22% from FY23.

• Operating cash inflow was $82.9 million, with cash conversion at 129%, down from 163% in FY23.

Outlook and guidance

• FY25 expected to benefit from average seasonal conditions and normalised first quarter earnings, with positive momentum from Q4 FY24.

• Targeting 5%-10% growth in EBIT and EPS through the cycles, with a minimum 15% return on capital.

• Margin stability anticipated in rural products, with livestock prices and volumes forecast to remain strong.

• Real Estate and Financial Services expected to benefit from acquisitions and industry trends.

• No formal annual guidance provided, but management is focused on financial discipline and cost control.