HRnetGroup (CHZ) H2 2023 earnings summary

Executive summary

• FY2023 revenue was S$578.5m, PATMI S$63.6m and EBITDA S$79.5m; revenue and PATMI declined YoY, while PATMI/GP conversion improved to 45.7%.

• Cash, CLN and T-bills totaled S$311.6m with zero borrowings; 2023 dividends and buybacks returned S$42.3m to shareholders, equal to 76% of FCF.

Financial highlights

• Revenue fell 5.4% YoY to S$578.5m; gross profit declined 20.2% to S$139.0m.

• NPAT was S$66.1m, down 8.8%; PATMI was S$63.6m, down 5.9%; EPS was 6.44 cents, down 4.6%.

• EBITDA declined 14.6% to S$79.5m; PBT was S$78.0m, down 10.1%.

• Other income rose 40.6% to S$28.1m, including S$9.3m reversal of trade-related accruals, S$9.2m government subsidies and S$6.9m interest income.

• FY2023 results exceeded the displayed analyst consensus estimates: NPAT S$66.1m vs S$61.0m consensus and PATMI S$63.6m vs S$57.6m consensus.

Outlook and guidance

• 2024 real GDP growth forecasts include Indonesia 5.0%, Mainland China 4.6%, Singapore 2.1%, South Korea 2.3% and Japan 0.9%.

• The presentation cautions that forward-looking statements are subject to risks and uncertainties that may significantly affect expected results.