Shares in Bega Cheese topped the ASX 200 performance chart on Thursday after a 2019-20 profit that satisfied investors.
The Bega share price reached as high as $5.30 (a rise of more than 8%) and closed a touch lower at $5.24, still up 7.8%.
For the full year ending 30 June, Bega revealed revenue of $1.5 billion, up 5% over 2018-19 thanks to strong sales in its international grocery market which grew by 15.1%.
But EBITDA fell 2% to $103 million, down almost 2% from $104.8 million.
Net profit after tax was $31.8 million, a small increase of 3% compared to the $31 million rise the year before.
The company also managed to reduce its net debt position by $52 million to $236.4 million.
Bega declared a fully franked dividend of 5 cents a share, for a total for the year of 10 cents a share.
That was down from the 11 cents paid the year before but directors made it clear they were being cautious while they waited to see how COVID-19 played out.
The company obviously wants to preserve cash and keep trimming debt.
Bega said in the profit commentary that the pandemic is expected to impact its customers and supply chain well into 2020-21 and possibly longer.
The company says it has been regularly reviewing its continuity plans to ensure it is able to meet the strong domestic demand for its products, as well as managing production destined for export markets.
Like so many other companies, Bega did not provide any guidance to future earnings. However, the company expects the improved seasonal conditions in recent months to help going into the current year.
It said it was determined to further reduce working capital and net debt to strengthen its balance sheet.
It also said it will be focusing on investing in its product range and branded foods portfolio to grow sales.
And no mention of future corporate activity which probably assured investors that it won’t be looking for new capital, even though it has been touted as the logical buyer for the Lion Nathan dairy assets that are back on the market for around $600 million.
