Coventry Group (CYG) H1 2025 earnings summary

Executive summary

• Group sales for H1 FY25 were AUD 185.2 million, flat year-over-year, with underlying EBITDA up 0.8% to AUD 9.9 million and EBIT steady at AUD 7.8 million.

• Statutory net loss was AUD 0.7 million, compared to a AUD 0.4 million loss in H1 FY24, mainly due to AUD 5.2 million in ERP project costs.

• Microsoft D365 ERP system upgrade completed on schedule and budget, with no further material costs expected in 2025 and full benefits anticipated.

• Net assets at 31 December 2024 were AUD 140.8 million, with current assets exceeding current liabilities by AUD 31.5 million.

• Recent Steelmasters acquisition performed to expectations, supporting organic growth initiatives.

Financial highlights

• Group sales for H1 FY25 were AUD 185.2 million, flat year-over-year.

• EBITDA (pre-AASB 16, pre-significant items) grew 0.8% to AUD 9.9 million; EBIT at AUD 7.8 million, flat year-over-year.

• Statutory net loss of AUD 0.7 million, impacted by one-off ERP implementation costs.

• Net cash from operating activities was AUD 7.5 million, up from AUD 6.4 million in the prior year.

• Net debt at 31 December 2024 was AUD 52.9 million, higher than planned due to delayed customer payments and ERP costs.

Outlook and guidance

• Expectation of improved net profit in H2 as ERP costs subside and delayed payments are collected.

• Group sales growth of 6.0% reported for the first six weeks of 2025, with daily sales at highest levels in over six months.

• Anticipate market conditions in Australia and New Zealand to improve in 2025, aided by interest rate cuts.

• Focus on organic growth, new store openings, margin improvement, and leveraging the new ERP platform.

• No further material ERP costs expected; business expected to become more cash generative.