HIT hitech group australia limited

Ann: HIT FY24 Results Summary, page-4

  1. 4,878 Posts.
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    Quite rare to see this kind of results : + 16.5 % for EBITDA despite - 14.5 % for revenues. Similar trends during H1 24.
    Apparently, the main explanation is the gross margin which went from 14.8 % to 20.1 %.
    But I was not able to find reasons for this gross margin trend.

    It seems that the company was able to more than offset the sales decrease during H1 (- 16 %) by the gross margin increase (19.9 % vs 12 %).
    However, gross profit decreased by 2 % yoy during H2 (as the company had a limited potential to further improve the gross margin which was already 18.1 % for H2 23) while sales decreased by 12 % yoy.

    Anyway, the stock does not look expensive with a free cash flow yield of 8.8 %.
    Not bad for a company which claims to have a "10th consecutive year of strong profit growth".

    As @RTheo mentioned it, we probably need some explanation to better understand the trends for sales and gross margin.
 
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