Peter Warren Automotive Holdings (PWR) H2 2024 earnings summary

Executive summary

• Achieved record FY 2024 revenue of AUD 2.5 billion (or $2.48bn), up 19.4% year-over-year, driven by organic growth and acquisitions.

• Underlying profit before tax (PBT) was AUD 56.8 million, within guidance, but down 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 and low net debt, supported by significant property assets.

• Four NSW dealership acquisitions completed and integrated; expansion via acquisition or greenfield sites considered.

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

Financial highlights

• Revenue increased 19.4% year-over-year to AUD 2.47 billion (or $2.48bn), with 13.1 percentage points from acquisitions and 6.3 from organic growth.

• Underlying PBT: AUD 56.8 million (down 30.6% year-over-year); statutory PBT: AUD 53.4 million.

• Gross profit margin declined to 16.9% from 18.9% due to new car margin pressure and Toyota acquisition dilution.

• 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 expected to continue growing, 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 FY 2025.

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

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