Steel & Tube (STU) H1 2026 earnings summary

Executive summary

• Sales revenue increased 8.1% year-over-year to $211.9m, with volumes up 11.3% to 54,213 tonnes, despite a challenging operating environment and slow economic recovery.

• Net loss after tax widened to $12.4m from $10.4m in the prior year, with basic and diluted loss per share at (6.8) cents.

• Perry's Galvanizing acquisition outperformed expectations, delivering above-expected synergies and offsetting margin pressure in the base business.

• Cost reductions, efficiency gains, and SKU rationalization from 23,000 to 15,000 have made the business leaner and more efficient.

• No interim dividend declared as capital discipline and balance sheet rebuilding are prioritized.

Financial highlights

• Net loss after tax for the six-month period was $12.4m, with normalised EBITDA at $2.8m, up from $2.0m in 1H25.

• Operating cash flow was $5.6m, down from $23.1m in 1H25.

• Product margin improved to 31.1% from 28.7% year-over-year, and per tonne margin rose to $1,214.

• Net debt increased to $43.0m, mainly due to the Perry acquisition, with net debt to total debt plus equity at 20%.

• Inventory at period end was $115.9m, with turnover stable at 2.3x.

Outlook and guidance

• Economic recovery is expected to be gradual and uneven through 2026, with cautious optimism for improvement.

• Construction and manufacturing demand forecast to rise, supported by lower interest rates, government spending, and infrastructure projects.

• No formal guidance provided, but management expects EBIT to improve in the second half, aiming for breakeven.

• Medium-term plans include debt reduction, resumption of dividends, and continued M&A activity as conditions allow.

• Management expects to meet revised banking covenants in the upcoming financial year.