In This Article:
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Revenue: $435 million, steady compared to both the first and second half of the previous year.
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EBITDA: $137 million, up 21% from the first half of 2023.
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EBIT: $60.7 million, up 49% from the prior corresponding period.
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Return on Capital: Improved to 15% from 13%.
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Operating Free Cash Flow: $40 million for the half.
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Net Leverage: Slightly above 1x EBITDA target.
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Rental Revenue: Just under $260 million, an increase of 11% from the first half of 2023.
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Rental Operating EBITDA: Just under $140 million, a 13% increase from the prior corresponding period.
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Force Operating EBITDA: $8.6 million for the first half of 2024.
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Pit N Portal Operating EBITDA: $12.1 million with an EBIT of $3.7 million.
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Net Debt: $290 million, up from $276 million.
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Liquidity: Just under $140 million, including $64.5 million in cash.
Release Date: February 19, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Emeco Holdings Ltd (ASX:EHL) reported a solid financial performance with a steady revenue of $435 million for the first half of 2024.
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EBITDA increased by 21% compared to the first half of 2023, reaching $137 million.
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The company improved its return on capital to 15%, up from 13% in the previous period.
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The rental and Force businesses delivered strong operational and financial performance, with stable margins due to improved contract pricing.
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The company maintained a strong balance sheet with net leverage slightly above its 1x EBITDA target, supported by positive cash generation and recent credit rating upgrades.
Negative Points
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The Pit N Portal business contributed slightly lower to EBIT due to higher depreciation charges and a $2 million lower contribution.
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The announced scale back of Wyloo projects is expected to marginally lower Emeco Underground earnings in the second half of 2024.
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The company's capital management program has been suspended, with a focus on reducing financing requirements.
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Operating NPAT saw a reduction compared to the last half due to a previous tax loss write-back.
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Growth CapEx is expected to moderate in FY25, potentially impacting future expansion opportunities.
Q & A Highlights
Q: Can you confirm if you're comfortable with the consensus EBITDA of about $280 million for the full financial year? A: Yes, we're comfortable with the consensus. - Ian Testrow, CEO
Q: Could you discuss the demand environment for parts and rebuilds in the Force group, which had another record period? A: Our Force business has performed exceptionally well, showing significant revenue growth over the past two halves. It provides quality service to our customers and a competitive advantage to our Rental business. Demand remains high. - Ian Testrow, CEO