HBY
27/02/2014 13:55
HALFYR
REL: 1355 HRS Hellaby Holdings Limited
HALFYR: HBY: Hellaby Holdings Ltd - Interim Announcement
Hellaby Holdings Limited - NZX / Media Release 27 February 2014
HELLABY DELIVERS ON FIRST HALF GROWTH PROMISE
Hellaby Holdings' group performance highlights for the six months to 31
December 2013 (comparisons to previous corresponding period):
- Trading EBITDA up 74% at $23.8 million
- Group NPAT up 60% to $9.9 million
- 22.9% return on funds employed
- Earnings per share up 23% to 10.1 cents
- Acquisition of Australian battery distributor Federal Batteries
- Interim dividend up 10% to 5.5 cents per share, fully imputed
Investment company Hellaby Holdings Limited (Hellaby) today reported a
significantly improved result for the six months to 31 December 2013,
highlighted by group trading EBITDA of $23.8 million, up 74% on the same
period last year, and NPAT up 60% to $9.9 million.
Hellaby Chairman John Maasland said that the strong performance was bolstered
by the company's two recent acquisitions, Contract Resources and Federal
Batteries, in addition to improved profitability in many of its businesses.
"The board is understandably pleased with this result. It is the first real
demonstration of the value being generated by the group's growth strategy,
reflecting both the benefits of portfolio expansion, and also the advantages
of diversification across different geographies and sectors."
Mr Maasland said the integration of both acquisitions during 2013 had been
remarkably smooth. "The board has been very impressed with the commitment of
the management teams of Hellaby, Contract Resources and Federal Batteries to
deliver a smooth and speedy transition, and remain focused on creating value.
This is already positively impacting the financial results."
Managing Director John Williamson said that while there were signs of
economic recovery in some areas, trading conditions have remained mixed
overall. "We're seeing growth in areas that are starting to pick up, such as
Equipment. However other sectors remain quite patchy, and the increased
profitability in some of our operations is simply due to the ongoing
commitment of our people to improve the performance of their respective
businesses."
Group sales were $351.6 million for the half year period, 44% higher than
last year's $243.7 million. Growth was driven primarily by the inclusion of
Contract Resources (acquired in April 2013) and Federal Batteries (September
2013), as well as a 38% increase in Equipment division sales.
Mr Williamson said four of the group's five divisions achieved operating
profits equal to or better than the same period last year, with only Footwear
performing below last year's level, driven mainly by a sluggish retail
environment. At $23.8 million, group trading EBITDA (trading surplus before
interest, tax, depreciation, amortisation and other non-trading transactions)
was 74% higher than the $13.7 million for the same period last year. Group
EBIT (trading surplus before interest, tax and other non-trading
transactions) was $17.2 million, up 62% on last year's $10.6 million. Both
EBITDA and EBIT profit measures included a full six month contribution from
Contract Resources and a three month contribution from Federal Batteries.
"Collectively this resulted in a return on funds employed (ROFE) of 22.9%,
well ahead of our group target of 20%. Likewise, our return on invested
capital (ROIC) was 14.7%, ahead of Hellaby's weighted average cost of capital
of 13.5%. These are both excellent results given that, calculated on a 12
month rolling basis, they include only nine months' earnings from Contract
Resources and three months' earnings from Federal Batteries, but are measured
against the full purchase price (including goodwill and transaction costs) of
those two acquisitions."
Corporate overheads decreased by 3% compared to the same period last year.
Group funding costs were $1.8 million higher, reflecting the debt-funded
acquisitions of Contract Resources and Federal Batteries. The tax expense was
$2.1 million higher than the same period last year.
Group NPAT (net profit after tax) was $9.9 million, a 60% increase on the
$6.2 million achieved for the corresponding period last year. Group NPAT
attributable to shareholders of the parent company was $9.4 million.
An interim dividend of 5.5 cents per share has been declared, compared to 5.0
cents last year. The record date is 4 April 2014, with payment to be made on
11 April 2014. The company has adopted a 2.5% discount under its Dividend
Reinvestment Plan.
Mr Williamson said he expected the second half to bring an ongoing solid
performance by all divisions. "The profitability of many of our subsidiaries
is weighted towards the second half, and we are on track to perform to market
expectations for the full year to 30 June 2014. Contract Resources is
expected to deliver to our previous forecast of at least $20 million EBITDA
in its first full financial year under Hellaby majority ownership."
"Our businesses will remain focused on operational improvement and organic
growth. The integration of Contract Resources and Federal Batteries will
continue, and we will also be driving acquisition opportunities to further
expand and enhance our portfolio."
Note: Reconciliations of non-GAAP financial measures are included on page 2
of the 2014 Interim Report.
ENDS
For further information please contact:
John Williamson
Chief Executive Officer
T +64 9 307 6844
M +64 21 271 4960
Richard Jolly
Chief Financial Officer
T +64 9 307 6844
M +64 27 497 6710
www.hellabyholdings.co.nz
Hellaby at a glance
Hellaby Holdings is an NZX-listed investment holding company, which owns a
diversified portfolio of 15 industrial, distribution and retail businesses.
Our vision is to be a leading Australasian investor, based on the value we
add to our portfolio, the returns we deliver to our shareholders and the
calibre of our people.
Hellaby's core purpose is to generate long-term shareholder value by building
better businesses. We achieve this through a combination of performance
improvement and organic growth in the businesses we own, as well as smart
acquisitions and divestments. We describe this strategy simply as 'Buy,
Build, Harvest'.
Our investment portfolio is structured through five divisions - Oil & Gas
Services, Automotive, Equipment, Packaging and Footwear - with 3,000 people
across New Zealand, Australia, Middle East and North America. We have a
variable investment horizon, and our portfolio will evolve as opportunities
arise in target investment areas.
We actively manage our investments through a lean corporate office, and
decentralise leadership and performance accountabilities to our companies.
We seek to generate total shareholder returns superior to the NZX50.
End CA:00247584 For:HBY Type:HALFYR Time:2014-02-27 13:55:44
