Steel & Tube (STU) H2 2024 earnings summary

Executive summary

• Delivered solid FY24 performance amid challenging economic conditions, maintaining strong market share and customer relationships, with revenue of $479.1m, down 18.7% year-over-year, and normalised EBIT of $14.5m, down 54.8% from FY23.

• Focused on higher-margin, value-added products and services, improving operating leverage and gross margin per tonne.

• Robust balance sheet with net cash position, no borrowings, and $100m facility available for growth and M&A.

• Strategic investments and M&A activity continue, with two acquisitions completed and eight under active consideration.

• Well positioned for recovery as economic conditions improve, with diversified product portfolio and sector exposure.

Financial highlights

• Revenue declined 18.7% year-over-year to $479.1m due to a 21% drop in volumes.

• Gross margin per tonne improved to $901, up from $850 in the prior year.

• Normalised EBITDA was $35.8m, down 32.3%; normalised EBIT was $14.5m, down 54.8% year-over-year.

• Net profit after tax was $2.6m, down 84.7%, including one-off and non-trading costs.

• Full-year dividend of 8.3 cents per share, gross dividend yield of 9.7%, with a new Dividend Reinvestment Plan introduced.

Outlook and guidance

• Economic recovery and demand growth anticipated from calendar 2025, with steady improvement rather than a rapid turnaround.

• Interest rate cuts and government infrastructure spending expected to stimulate activity in key sectors.

• Ongoing cost-out program targeting an additional $5m in savings for FY25.

• Well positioned to capitalize on infrastructure, manufacturing, and climate resilience opportunities.

• Government budget allocates $68b to infrastructure over five years, supporting medium-term sector growth.