In This Article:
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Revenue: Sales decreased by $190 million, down 6% year-on-year.
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Gross Margin: Increased by $18.6 million to $637.6 million, up 3% year-on-year.
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Underlying EBIT: Finished at $128 million, just below the midpoint of guidance.
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Net Debt: Increased by $177 million to $437 million.
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Return on Capital: Decreased from 16% to 11.3% in FY24.
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Dividend Per Share: Maintained at $0.18, franked at 70%.
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Operating Cash Flow: Inflow of $82.9 million.
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Inventory: Decreased by $94 million.
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Debtors: Increased by $157 million.
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Acquisition of Delta Ag: $475 million acquisition, with expected synergies of $12 million over three years.
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EPS Accretion: Mid-digit pre-synergies, double-digit post-synergies.
Release Date: November 17, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Elders Ltd (EDESY) demonstrated resilience in a challenging market, achieving a full-year EBIT of $128 million, which is near the midpoint of their guidance.
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The company maintained a strong cash flow and declared a stable dividend of $0.18 per share.
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Elders Ltd (EDESY) successfully executed 13 acquisitions in FY24, contributing to a diversified product and service portfolio.
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The Delta Agri acquisition is expected to be EPS accretive pre-synergies, enhancing Elders' geographical diversification and technical expertise.
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The company has made significant progress in sustainability initiatives, including centralized waste control and solar upgrades, aligning with their climate targets.
Negative Points
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Elders Ltd (EDESY) faced a difficult first quarter in FY24, impacting their overall financial performance and return on capital.
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The company's gross margin was negatively affected by competitive pressures and lower crop protection prices, particularly in the first half of the year.
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There was an increase in debtors due to a delayed winter crop and higher demand for seasonal finance, impacting working capital.
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The company's return on capital decreased from 16% to 11.3% in FY24, falling below their target of 15%.
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The acquisition of Delta Agri is subject to ACCC approval, which could pose risks if there are concerns about market concentration.
Q & A Highlights
Q: Could you provide an update on the business performance over the last 1.5 months and the outlook for the first quarter of FY25? A: Paul Rossiter, CFO: The start of FY25 is in line with expectations, continuing the recovery seen in the second half of FY24. We are seeing a continuation of themes in livestock recovery and stability in wholesale and real estate sectors.