Gowing Bros (GOW) H2 2024 earnings summary

Executive summary

• Results were impacted by 13 interest rate increases by the Reserve Bank of Australia, leading to reduced sales and profitability in Surf Hardware International and higher long-term interest expenses.

• The group refinanced long-term debt on more flexible terms and renewed key leases, including Coles at Kempsey Central.

• A $6 million capital gain was realized from the Eli Lilly takeover of DICE Molecules.

• Sawtell Commons Stage 3 sales contributed significantly to cash flow and earnings.

• Shopping centre sales grew from $149 million in 2019 to $164 million in 2024, with strong leasing interest and new shop openings.

Financial highlights

• Net assets at 31 July 2024 were $203.6 million, down from $205.7 million the previous year.

• Net loss after tax was $0.04 million, a significant improvement from a $5.3 million loss in the prior year.

• Earnings per share were (0.07)c, compared to (9.91)c last year.

• Total shareholder return was 1.1%, including a 6.0c dividend paid during the year.

• Dividends declared per share totaled 6.45c, fully franked.

Outlook and guidance

• Outlook has improved with inflation within the RBA target range and potential rate cuts expected to relieve financial pressure on tenants and customers.

• Anticipates gradual recovery in consumer confidence and spending as economic conditions stabilize.