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- Mining equipment solutions provider Emeco (EHL) increases revenue by 22 per cent to $754 million for FY22, reflecting growth of its Pit N Portal and Force Workshops divisions
- The company also announced a five per cent increase in EBITDA to $250 million and a 21 per cent rise in net profits thanks to higher earnings and lower finance costs
- The board also announced a $13 million capital management package, including a 1.25 cent fully franked final dividend and $6.4 million to be applied to the buy back program
- Emeco says that while it expects tight labour markets and inflation challenges to continue, it’s confident it can deliver sustainable growth and increase shareholder returns in FY23
- Company shares are up 1.54 per cent to trade at 82.3 cents at 3:44 pm AEST.
Mining equipment solutions provider Emeco (EHL) has achieved growth across all operating segments in FY22.
Emeco reported operating earnings before interest, tax, depreciation and amortisation (EBITDA) of $250 million which was at the lower end of its guidance but marked a five per cent year-on-year (YoY) increase. The company described this as a “solid” result in the face of covid disruptions, labour shortages, inflationary pressures and weather events.
Earnings before interest and tax came to $121 million, largely in line with FY21, and generated a 16 per cent return on capital which remains above the company’s cost of capital.
Net profits after tax totalled $69 million which represents a 21 per cent leap on the prior year and can be attributed to higher earnings and lower finance costs.
Emeco saw its revenue rise 22 per cent YoY to $754 million, with significant growth in Pit N Portal and Force Workshops.
Rental revenue continued to grow as assets were deployed throughout the year despite tight labour markets and significant weather events on the east coast.
Importantly, the Board just announced a 2H22 capital management package of $13 million, including a 1.25 cent fully franked final dividend and $6.4 million to be applied to the buy back program.
When combined with the additional $7.6 million of shares Emeco purchased during 2H22, the capital management package brings the total amount allocated to capital management for FY22 to $31.7 million.
Additionally, earnings per share more than tripled to 12.1 cents, as a result of operating earnings, a significant reduction in financing costs and a reduced share count as a result of share buy back.
CEO and Managing Director Ian Testrow said FY22 was a “solid year” of operating and financial performance.
“Our team have worked tirelessly to achieve growth and maintain excellent service levels to our clients as well as operating safely,” he said.
“Whilst the challenges of tight labour markets and inflation are likely to remain through the year, I am confident that we can deliver sustainable growth from our existing assets and deliver increasing shareholder returns in FY23 as we leverage our strong market positions.”
Company shares were up 1.54 per cent to trade at 82.3 cents at 3:44 pm AEST.
