Waterco (WAT) H2 2024 earnings summary

Executive summary

• FY24 marked a transformational year with the acquisition and integration of Davey Water Products, driving significant revenue and earnings growth.

• Sales revenue surged 85% to $239.1m, with underlying EBITDA up 59% to $34.5m and underlying NPAT up 35% to $14.6m year-over-year.

• The acquisition expanded product offerings, market reach, and operational synergies, positioning the group for further growth.

• Dividend per share increased 50% to 15c, reflecting strong financial performance and positive outlook.

• Sustained share price appreciation with a 5-year CAGR of 27%.

Financial highlights

• Operating revenue rose 83% to $244.8m; sales revenue up 85% to $239.1m compared to FY23.

• Underlying EBIT increased 60% to $23.2m; underlying EBITDA up 59% to $34.5m.

• Underlying NPAT grew 35% to $14.6m; underlying EPS up 35% to 41.5 cents.

• Total declared dividend up 50% to 15c per share, fully franked.

• Net working capital increased by $49.2m, mainly due to the Davey acquisition.

Outlook and guidance

• Focus on increasing market share in Pool & Spa, further synergies from Davey, and geographic expansion.

• Continued investment in products, technology, and optimising distribution networks.

• Anticipated further margin improvements and operational cash flow to support debt reduction in FY25.

• Consideration of further M&A opportunities once Davey integration is complete.