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 NZD 479.1 million, down 18.7% year-over-year, and normalised EBIT of NZD 14.5 million, down 54.8% from FY23.

• Maintained strong gross margin per tonne through focus on higher-margin, value-added products, pricing discipline, and cost control.

• Robust balance sheet with net cash position, no borrowings, and a NZD 100 million 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

• Net profit after tax was NZD 2.6 million, including one-off and non-trading costs, down 84.7% year-on-year.

• Revenue declined 18.7% year-on-year to NZD 479.1 million due to a 21% drop in volumes.

• Gross margin dollars per tonne improved to NZD 901, up 6% year-on-year.

• Normalised EBITDA was NZD 35.8 million and normalised EBIT was NZD 14.5 million, in line with guidance.

• Full-year dividend of NZD 0.06 per share, with a gross dividend yield of 9.7% and 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 NZD 5 million in savings for FY 2025.

• Focus on supporting customers, margin management, cost control, and exploring organic and M&A growth opportunities.

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