K&S (KSC) H2 2024 earnings summary

Executive summary

• Operating revenue declined 2.9% to $824.6 million for FY2024, with statutory profit after tax rising 9.1% to $31.2 million year-over-year.

• Underlying profit before tax (excluding significant items) was $42.1 million, down 3.6% from the prior year, while underlying profit after tax increased 3.4% to $31.7 million.

• The Group maintained a strong balance sheet, with shareholders' funds up 10.7% to $355.9 million and gearing ratio (excluding lease liabilities) at 6.3%.

• A fully franked final dividend of 8.0 cents per share was declared, bringing the total FY2024 dividend to 18.0 cents per share, unchanged from FY2023.

• Safety performance improved, with lost time injury frequency rate dropping to 3.0 from 5.4.

Financial highlights

• Statutory profit before tax increased 1.6% to $41.3 million; EBIT rose 1.9% to $44.9 million year-over-year.

• EBITDA fell 2.8% to $87.6 million; underlying EBITDA was $88.4 million, down 5.0%.

• Net borrowings (excluding lease liabilities) rose to $23.8 million from $(0.4) million, mainly due to property acquisitions.

• Operating cash flow decreased 35.2% to $65.8 million.

• Net tangible assets per share increased 10.8% to $2.56.

Outlook and guidance

• Higher inflation, interest rates, input cost pressures, customer de-stocking, and lower construction activity are expected to present risks to FY2025 results.

• Loss of several customer contracts will pressure FY2025 results, but price, volume, and margin improvements are anticipated to partially offset these impacts.

• The Group will focus on quality revenue growth, working capital management, and accretive investments in property and market segments.