- Release Date: 20/02/14 10:30
- Summary: HALFYR: STU: 2014 Half Year Results
- Price Sensitive: No
- Download Document 6.62KB
STU 20/02/2014 08:30 HALFYR REL: 0830 HRS Steel & Tube Holdings Limited HALFYR: STU: 2014 Half Year Results Issuer: Steel & Tube Holdings Limited Reporting period: 6 months to 31 December 2013 Previous reporting period: 6 months to 31 December 2012 Amount ($000)Percentage Change Revenue from ordinary activities: 211,653; 6.05% Profit before tax 11,233; 10% Tax expense - operating income 3,202; 8% Profit after tax attributable to security holders: 8,031; 10% Current Year Prior Year Net tangible assets per share: $1.53 $1.53 Amount per security Imputed amount per security Interim Dividend: 7.0 cents 2.7 cents Supplementary dividend: 1.2 cents Record date: 14 March 2013 Payment date 31 March 2013 Review The financial statements attached to this report have been reviewed. Comments Refer to separate attachment. The unaudited condensed consolidated interim financial statements have been prepared in accordance, and comply, with, New Zealand Generally Accepted Accounting Practice (NZGAAP), New Zealand Equivalents to International Financial Reporting Standard NZ IAS 34: Interim Financial Reporting and International Accounting Standard IAS 34: Interim Financial Reporting. Directors' Report Steel & Tube half-year results reflect solid performance Steel & Tube has posted a positive half-year result, reflecting a solid performance in the six months to 31 December 2013. Both profits and sales have increased compared to the same period last year on the back of a slowly improving economic environment. Good progress also continues across multiple initiatives aimed at improving the effectiveness of the organisation to serve customers. Results The trading result for the six months to 31 December 2013 is a profit after tax of $8.0 million. This is an increase of 10 percent compared with the same period last year, and is consistent with previous guidance. Sales have also increased by $12.1 million or 6 percent to $211.7 million on improved volumes. Margins were consistent with last year despite lower selling prices. The net tangible assets per share at 31 December 2013 have remained at $1.53. Dividend The Directors have declared a fully-imputed interim dividend of 7 cents per share to be paid on 31 March 2014 to holders of fully-paid ordinary shares, registered at 14 March 2014. The amount payable is $6.19 million and a supplementary dividend of 1.2 cents will be paid to non-resident shareholders. Performance The new financial year ushered in a more positive economic sentiment after multi-year lows, with expectations of a firmer economic footing set to position the New Zealand economy for expansion. These expectations have started to materialise, albeit slowly, with activity levels and volumes increasing across most of our sectors and product categories. The construction sector and in particular residential construction continue to lead the way with strong activity in Christchurch and Auckland. Consequently those products aligned to this sector continue to do well. Non-residential appears to be slowly improving and we are participating in several key infrastructure projects across the country. Similarly, the rural sector continues to be buoyed with solid demand and healthy commodity prices more than compensating for drought-impacted volumes. As a result, investments are increasing in dairy and viticulture. In anticipation, Steel & Tube has made substantial investments ensuring we are well positioned to support the increased activity, particularly in the construction sector. New plant and equipment was commissioned which has boosted our wire processing and roofing capabilities in Canterbury. Other investments within reinforcing and a lift in key product lines are also positioning the business for increased activity. Globally, the steel industry continues to grapple with excess capacity and sluggish demand suppressing margins and creating pricing volatility. The mid half-year price increase had mixed impact as competition remains intense. Meanwhile, investment in our people and the business continued on multiple fronts and we have made good progress on moves to strengthen and revitalise our business via the One Company transformational project. The key supply chain building blocks are in place and focus has turned to the IT infrastructure with a number of initiatives already completed. Health and Safety remains a key focus and the number of incidents in the period are consistent with the improved position of last year. Outlook During the first half we began to see further evidence of the beginnings of economic recovery. Indicators and sentiment now suggest that New Zealand may be on the cusp of a marked economic turnaround. Similarly, the global economic outlook is also generally more optimistic, despite relatively muted growth and internal debt concerns within China. Domestically a key driver for the economy is the construction sector with the rebuild effort in Christchurch, heavy demand for residential housing particularly in Auckland and on-going government infrastructure expenditure. New residential consents continue to increase with December consent data (by value) 29.7 percent higher than the previous year. However non-residential data is only 6.9 percent higher than last year and disconcertingly, the last quarter to December 2013 saw a reduction of 9.9 percent by value. Another key driver is the rural sector with commodity prices remaining robust. Investments are expected to gain momentum over coming years directly from the sector and from those manufacturers supplying into it. While New Zealand's manufacturing sector is not as bullish as other sectors we do expect to see slow improvements in volumes with some attributable to pull through from other sectors. Although quarterly output data is volatile we were encouraged by the increase to metal manufacturing output for the September quarter of 6.6 percent. Despite slowly improving domestic steel demand the industry remains extremely competitive. For Steel & Tube to remain competitive new investment and greater labour flexibility is critical. We remain focused on delivering multiple initiatives aimed at improving our capabilities, products and services to customers, while maximising our position for the anticipated lift in activity. Steel & Tube remains in good shape, increasingly benefiting from the company's reinvigoration and with an expectation the momentum of the first half will continue into the second half. For further information, please contact Dave Taylor, Chief Executive Officer, Steel & Tube Holdings Limited on (04) 570 5001. ENDS End CA:00247228 For:STU Type:HALFYR Time:2014-02-20 08:30:38
Add to My Watchlist
What is My Watchlist?
