Hellaby Holdings produced a ''satisfying solid''
operating profit of $56.1 million for the year ended June,
Craigs Investment Partners broker Chris Timms said.
Although some of the company's divisions did not perform up
to expectations, the diverse company had taken measures which
would provide benefits in the future.
The operating profit was up 49% on the previous corresponding
period. Earnings per share increased 20% to 27.4 cents per
share, reported profit was up 44% to $26.8 million and there
was a 25.4% return on funds employed. Revenue was up 35.2% to
Acquisitions were made during the year and while Construction
Resources was a disappointment, the actual result was 9%
better than revised guidance, Mr Timms said.
The company had a low gearing, or 23%, and would probably be
comfortable with a gearing up to 35% if it was to buy more
Hellaby also decided to write down the goodwill for its
underperforming Hannahs and Number One Shoes, taking a hit of
$26.9 million. Mr Timms said the write-down brought the
company back to the value Hellaby believed it was worth.
Hellaby managing director John Williamson said the improved
operating result included the positive impact of recent
acquisitions as well as creditable performances by Hellaby's
Four of the five divisions performed ahead of last year and
within those divisions, most businesses had improved
year-on-year. The equipment business had a particularly
stellar year, Mr Williamson said.
The three acquisitions made during the year - Federal
Batteries, Dasko and New Zealand Trucks - were all
integrating well and performing as expected.
The continued focus on profitable market share, operating
efficiency and tight financial control was demonstrated by
Hellaby's strong key financial indicators, Mr Williamson
The board declared a final tax-paid dividend of 9.5cps,
taking the total dividend for the year to 15cps, 15% higher
than the previous period. Chairman John Maasland said the
final dividend had been determined as if no goodwill
impairment had occurred.
''The board took this decision in recognition of the
company's record earnings growth, its strong positive outlook
and because the impairment had no impact on group cash
Looking ahead, Mr Williamson said the company was expecting
to see increased contributions from its recent acquisitions,
solid performances from its longer-held subsidiaries and
continued focus on reshaping its portfolio.
''We're in excellent financial shape with a very strong
balance sheet to support further acquisitions and currently
have some interesting opportunities in play.''