Acquisition lends strength to Steel & Tube results
Key Financial Results
- The trading result for the full year to 30 June 2014 is a profit after tax of $17.9 million, compared with $15.6 million for the previous year. An increase of 14.7 per cent
- Revenue increased to $441.4 million and includes $12.9 million from Stainless (Tata Steel International (Australasia) Ltd), representing a 12.2 per cent increase, compared with $393.3 million for the previous year
- Operating cashflow: $12.3 million
- Net borrowings increased to $58.7 million, reflecting the Stainless acquisition and the increase in inventory and debtors associated with increased revenue
- A final dividend of 9 cents per share was declared on 14 August 2014.
Steel & Tube CEO Dave Taylor says the company enjoyed a strong year, with improved top-line performance increasing bottom-line results. “The acquisition of the Tata Steel (Australasia) business in April 2014 – since rebranded to S&T Stainless – strengthens our position as the leading stainless supplier within New Zealand, with exclusive distribution rights to several key product lines.”
Mr Taylor says the Stainless operation is going well and performing in line with expectations.
The company continues to reinvest for growth. Two new facilities are currently being built in Auckland, with new plant and machinery that will further enhance processing capability and efficiency. Another purpose-built facility in Palmerston North is set to begin operating in the final quarter of 2014. Key ICT projects, aimed at enhancing customer interactions and service are also underway.
From a wider industry perspective, he says, “Economic activity, and consequently volumes, improved across most sectors although competition remains intense, restraining margins”.
Mr Taylor welcomes the Government’s continuing commitment to infrastructure, noting that S&T is currently participating in some of the country’s most iconic building projects, including Auckland’s Waterview Connection, Wellington’s National War Memorial Park and underpass and Burwood Hospital in Christchurch.
Globally, he says, the steel industry remains challenged: over-capacity is a continuing issue alongside increasing geopolitical risks and reducing economic forecasts across several regions.
Mr Taylor is confident about Steel & Tube’s future. “We expect that the economic activity levels across the sectors we serve will continue to increase and the S&T business will continue to deliver improving results.”
For further information contact Diane Robinson, Steel & Tube Communications Manager: 04 570 3290 or 027 569 1919