Peter Warren Automotive Holdings (PWR) H2 2024 earnings summary

Executive summary

• FY24 revenue rose 19.4% year-over-year to AUD 2.48 billion, driven by organic growth and acquisitions, with record vehicle deliveries and expansion in new and used cars, service, parts, and aftermarket products.

• Underlying profit before tax (PBT) was AUD 56.8 million, within guidance but down 30.6% from AUD 81.9 million last year, due to lower new car margins and higher interest costs.

• Strong cash generation with AUD 112.6 million from operations, low net debt, and significant property assets valued at AUD 226 million.

• Four NSW dealership acquisitions completed and integrated, with further expansion in Toyota, Volkswagen, and GWM businesses.

• New CEO, Andrew Doyle, to commence on 1 October 2024.

Financial highlights

• Revenue increased 19.4% year-over-year to AUD 2.48 billion, with 13.1 percentage points from acquisitions and 6.3 from organic growth.

• Underlying EBITDA was AUD 135.0 million (down 3.9% year-over-year); statutory EBITDA was AUD 131.6 million (down 5.8%).

• Gross profit margin declined from 18.9% to 16.9% due to new car margin pressure and lower margins from acquired Toyota dealerships.

• Operating expenses reduced from 12.2% to 11.5% of revenue, saving AUD 9 million annually.

• Final dividend declared at AUD 0.06 per share, bringing the full-year dividend to AUD 0.145 per share, fully franked.

Outlook and guidance

• Revenue growth expected to continue in FY25, especially in service, parts, aftermarket, and finance.

• New car margins anticipated to remain under pressure, but other segments to maintain strong margins.

• Continued focus on inventory management, margin improvement, and cost reduction into FY25.

• Expansion strategy remains, but with a more cautious and selective approach to acquisitions and greenfield sites, focusing on maintainable earnings and shareholder value.

• Well-positioned for NVES and energy transition with broad brand and fuel options.