Sanford (SAN) H2 2024 earnings summary

Executive summary

• Adjusted EBIT rose 50% year-over-year to a record $74.2m, driven by wildcatch restructuring, strong salmon and mussel pricing, and reduced head office costs.

• NPAT increased 96% year-over-year to $19.7m, despite significant asset impairments and a one-off negative tax adjustment.

• Revenue grew 5% year-over-year to $582.9m, reflecting improved prices across key species.

• Operating cashflow surged 78% year-over-year to a record $73.0m, aided by inventory rationalisation and expedited cash collection.

Financial highlights

• EBIT up 75% year-over-year to $54.3m, with large one-off impairments/adjustments of $19.9m from restructuring.

• Earnings per share increased from 10.7c to 21.1c; full year dividend of 10.0c per share declared, with a reduction in the final dividend to prioritize debt reduction.

• Net debt reduced 5% year-over-year to $185.5m, reflecting stronger financial performance and lower capital expenditure.

• Operating cashflow funded $46.0m in capex, dividends, and net debt reduction.

Outlook and guidance

• FY25 focus on capital allocation, operating cashflows, debt reduction, and dividends.

• Anticipated price pressure on some species, especially those exported to China.

• Cost increases expected in fuel, feed, freight, and wages, necessitating productivity improvements and cost reduction plans.

• Net benefits from cost initiatives expected to materialize in FY26.