SGH (SGH) H2 2024 earnings summary

Executive summary

• Revenue grew 10% year-over-year to AUD 10.6 billion, with underlying EBIT up 20% to AUD 1.42 billion and NPAT up 30% to AUD 850 million, driven by strong customer activity across industrial services, mining, infrastructure, and transitional energy sectors.

• Industrial Services, led by WesTrac, Boral, and Coates, delivered strong earnings growth and margin expansion.

• Completed compulsory acquisition of Boral, now fully integrated, enhancing access to cash flow and strategic assets, and eliminating non-controlling interests.

• FY24 total shareholder return reached 56%, with a 10-year EBIT CAGR of 18%.

• Significant progress in safety and sustainability, with TRIFR and LTIFR down 26%.

Financial highlights

• Revenue up 10% year-over-year to AUD 10.6 billion; EBITDA up 14% to AUD 1.93 billion; EBIT up 20% to AUD 1.42 billion; EBIT margin expanded 106 bps to 13.4%.

• Group NPAT of AUD 850 million, up 30%; statutory NPAT of AUD 464 million, down 23% due to impairments.

• Operating cash flow down 16% to AUD 1.31 billion, impacted by over AUD 500 million working capital investment at WesTrac.

• Final ordinary dividend of AUD 0.30 per share, total AUD 0.53 per share, fully franked, up 30%.

• Return on equity at 20.8%, up 406 bps.

Outlook and guidance

• FY25 guidance for high single-digit EBIT growth, supported by strong demand, robust project pipelines, and productivity gains.

• WesTrac expected to benefit from strong capital sales pipeline and service demand; Boral and Coates to leverage productivity and infrastructure pipeline.

• Beach Energy targets 17.5–21.5mmboe production, with strategic refresh underway.

• Leverage expected to reduce from 2.26x to around 2.1x by end of FY25, assuming no major transactions.