Melbourne-based packing group Pact (ASX:PGH) faced significant challenges in the 12 months leading up to June 30, resulting in financial losses and the omission of its final dividend.
As there was no interim dividend, shareholders will experience a shortfall. However, Raphael Geminder, a wealthy Melbourne businessman and 49% owner of the company, won't be impacted by this decision.
In addition, the company revealed the sale of a 50% stake in its crate pooling and crate manufacturing business for $160 million to infrastructure investor Morrison & Co.
Pact reported a loss of $6.6 million for the fiscal year 2022-23, attributed to $53 million in write-downs.
Despite challenging economic conditions, softer demand from Asia, and weather events across Australia and New Zealand, the company managed to achieve a 6% increase in revenue, reaching $1.949 billion. This growth was attributed to cost recovery and volume expansion, as highlighted by the directors.
The underlying earnings before interest and taxes (EBIT) of $145 million fell within the revised guidance range provided on May 15, 2023. However, it was 7% lower than the previous corresponding period due to the ongoing impact of adverse environmental conditions, alongside rising labor and domestic supply chain costs.
The reported net profit after tax (NPAT) recorded a loss of $7 million, mainly due to a non-cash impairment of $37 million in property, plant, and equipment within the Packaging & Sustainability segment. Directors explained that this impairment primarily reflected the anticipated replacement of plant and equipment across various platforms in Australia.
Pact stated its intention to provide a comprehensive update for the year 2024 during the upcoming annual meeting later in the year.
