GWA is doing its best to keep shareholders happy in straightened times.
The company revealed yesterday that it will pay a final dividend of 9.5 cents a share, fully franked, taking the total dividend for the year to 18.5 cents a share.
That’s up from 18 cents a share in 2017-18 and a payout ratio of a very high 94.3%.
GWA admitted the payout “is higher than the company’s dividend policy.”
“However, the Board believes the level of dividend is appropriate and strikes the right balance between immediate returns to shareholders and investment for future growth, coupled with the expectation that Methven (a New Zealand taps group bought during the year) will positively contribute to future earnings growth.
Directors said yesterday that during the year the Group successfully completed the divestment of its Door & Access Systems’ business, acquired Methven Ltd “and delivered a solid financial result for shareholders.”
GWA is singularly focused on driving growth opportunities and sustainable value creation for shareholders over the medium term.
The company reported that ‘Normalised Group Net Profit After Tax from Continuing Operations’ was $51.8 million compared to $50.1 million for the prior year.
Total Revenue rose 6.4% to $381.7 million compared to $358.6 million last year with ‘normalised Group EBITDA’ increasing by 2.7%” to $82.3 million with ‘normalised Group’ EBIT improving 1.5% to $77.4 million.
(“Normalised refers to the exclusion from these figures of any contribution from the Door & Access Systems’ business which were sold in the year).
GWA’s reported statutory net Profit After Tax was $95.0 million which includes the $50.8 million after-tax profit from the sale of the Door & Access Systems’ business which was finalised on 3 July 2018, and $7.6 million in significant items (after-tax) relating to transaction and integration costs associated with the acquisition of Methven.
During the year, net debt increased to $141.9 million compared to $97.7 million in the prior year which reflects the acquisition of Methven which was funded from GWA’s existing debt facilities4.
Directors said the company “remains in a strong financial position.”
GWA says it will continue to target cost efficiencies and “is on track to deliver its $9-12 million cost out programme by FY21 with cost savings of approximately $3 million achieved in FY19, primarily from procurement, network optimisation and warehousing. “
“These cost savings are being used to selectively reinvest in the business and maintain margins,” directors said on Monday.
GWA shares rose 1.8% to $3.40.
