Vulcan Steel (VSL) H1 2026 earnings summary

Executive summary

• Revenue rose 8.6% year-over-year to NZ$535.4 million for 1H FY26, driven by the acquisition of Roofing Industries Limited and volume recovery in key markets.

• Adjusted EBITDA was NZ$57.3 million, up 0.7% year-over-year, while adjusted NPAT rose 1.3% to NZ$9.3 million; statutory NPAT fell 9.7% to NZ$8.3 million.

• Operating cash flow declined 52.1% to NZ$38.7 million due to increased working capital and acquisition-related outflows.

• Net debt reduced by NZ$30.1 million since June 2025, now at NZ$202.3 million, with net debt/EBITDA at 2.9x.

• Interim dividend maintained at NZ 2.5c per share, fully franked/imputed.

Financial highlights

• Gross margin was 33.9%, down slightly from 34.1% year-over-year.

• Sales volume increased 10.8% to 120,988 tonnes, with active trading accounts up 12.6%.

• Customer base expanded 12.6% to 25,456 transacting customers.

• Adjusted cash conversion dropped to 55.6% from 59.6% year-over-year.

• Return on Capital Employed (ROCE) fell to 7.6% from 10.3% year-over-year.

Outlook and guidance

• Market conditions are stabilizing, with signs of recovery in New Zealand and Australia, though margin pressure persists.

• Demand is expected to improve gradually through FY26, but inflation and potential interest rate hikes remain risks.

• Steel segment outlook is positive, while metals segment faces mixed prospects.

• Olympic-related project activity in Australia is not expected to impact results until FY27 or later.

• Working capital requirements expected to rise over the next 12–18 months due to higher material prices and anticipated demand recovery.