Inghams Group (ING) H2 2024 earnings summary

Executive summary

• FY24 delivered record results with revenue up 7.2% to $3,262.0M, underlying pre-AASB 16 EBITDA up 30.8% to $240.1M, and NPAT up 68% to $101.5M, driven by volume and margin growth in both Australia and New Zealand.

• Fully franked dividends totaled 20.0cps, up 37.9% year-over-year, with a payout ratio of 73.1%.

• Return on invested capital reached 21.3%, up from 19% in FY23.

• Safety performance improved, with TRIFR down to 4.4 and a 7% decline in injury frequency rate.

• Retail channel volumes grew as consumers shifted to in-home dining amid cost-of-living pressures.

Financial highlights

• Underlying pre-AASB 16 EBITDA rose 30.8% to $240.1M; EBITDA margin increased 130bps to 7.4%.

• Group revenue grew 7.2% year-over-year to $3,262.0M, driven by a 5.4% increase in net selling price and 2.8% volume growth.

• NPAT increased 68% to $101.5M; EPS up 68% to 27.3cps.

• Cash flow from operations was $453.1M, with cash conversion at 97.7%.

• Net debt increased by $85.4M to $347.9M, mainly due to acquisitions.

Outlook and guidance

• FY25 core poultry volume expected to decline 1%–3% due to phased Woolworths contract changes and cost-of-living pressures.

• Underlying pre-AASB 16 EBITDA guidance for FY25 is $236M–$250M, representing flat to ~6% growth.

• Modest growth in net selling price anticipated; feed cost reductions expected to provide net benefit.

• Capital expenditure (excluding Bostock acquisition) forecast at $100–110M.

• Cost savings initiatives planned to offset inflationary effects.