Gowing Bros (GOW) H2 2024 earnings summary

Executive summary

• FY24 was impacted by 13 RBA interest rate hikes, reducing sales and profitability at Surf Hardware International and increasing long-term interest expenses.

• Key achievements: refinancing long-term debt, $6M capital gain from DICE Molecules sale, strong Sawtell Commons sales, and solar panel installations.

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

• Final fully franked LIC dividend of 3.45c declared, with prudent dividend policy maintained.

• Outlook improved as inflation moves into RBA target range and rate cuts are anticipated in 2025.

Financial highlights

• Net loss after tax of $0.04M for FY24, a significant improvement from $5.3M loss in FY23.

• Net assets at $203.6M ($3.84 per share), down from $205.7M ($3.86 per share) in FY23.

• Earnings per share (EPS) of (0.07)c, up from (9.91)c in FY23.

• Total dividends declared for FY24 were 6.45c per share, fully franked.

• Total shareholder return was 1.1% for FY24, including dividends.

Outlook and guidance

• Easing global monetary policy and lower inflation in Australia expected to support business segments.

• Anticipated interest rate cuts in 2025 should relieve financial pressure on tenants and customers.

• Shopping centres expected to remain resilient and benefit from infrastructure projects like the Coffs Harbour Bypass.