Business
GWA : Annual Report 2020
GWA : Annual Report
About this update from Gwa Group Limited
2020 Annual Report In this report Five Year Financial Summary 1 Board of Directors 12 Company Profile 2 Directors' Report 14 Strategic Summary 3 Financial Report 32 Chairman's Report 4 Other Statutory Information 79 Managing Director's Review of Operations 7 Shareholder Information 80 FY20 Performance Highlights GWA delivers disciplined financial result Continued cost discipline helps mitigate challenging market conditions NORMALISED 1 FROM CONTINUING OPERATIONS 2 A$ million excludes significant items, includes Methven for full year REVENUE EBIT OPERATING CASH FLOW $398.7 million $71.8 million $61.0 million 4.4% 8.0% 9.9% EBITDA NPAT EPS $92.2 million $44.9 million $17.0c per share 0.8% 11.6% 2.3c per share Reported 3 Net Profit After Tax Solid balance sheet maintained Successful integration of the for the period was $43.9 million with strong cashflow conversion Methven acquisition into the $43.9 million and cost discipline , enabling Group which remains on track the Company to manage with synergies achieved ahead through the current challenging of schedule. Final dividend 3.5 cents conditions. Caroma Smart Command® per share, full-year dividend Continued execution of superior gaining market traction with 11.5 cents, fully franked water solutions growth strategy focus on sustainability benefits 11.5 cents which has strengthened and enhanced hygiene. position for when market the Company's competitive conditions improve. Normalised is before $(1.0)m in significant items (after tax) relating to integration costs associated with the acquisition of Methven (FY19: $(7.6)m). Continuing Operations include the revenue and earnings contribution from Methven from the effective date of acquisition, 10 April 2019, but exclude the Door & Access Systems' business which was sold on 3 July 2018. Reported result includes $(1.0)m significant items (after tax) relating to integration costs associated with the acquisition of Methven. FY19 Reported result includes $50.8 million after tax profit from the sale of the Door & Access Systems business and $(7.6)m in significant items (after tax) relating to transaction and integration costs associated with the acquisition of Methven. Five Year Financial Summary CONTINUING OPERATIONS (1) 2015/16 2016/17 2017/18 2018/19 (7) 2019/20 (7) $'000 $'000 $'000 $'000 $'000 Revenue from continuing operations 439,666 350,437 358,622 381,730 398,704 Earnings before interest, tax, depreciation, amortisation (EBITDA) and significant items (2) 84,250 78,423 80,171 92,986 92,206 EBITDA margin (%) 19.2 22.4 22.4 24.4 23.1 Depreciation and amortisation (5,985) (4,122) (3,929) (14,869) (20,366) Earnings before interest, tax and significant items (EBIT) (2) 78,265 74,301 76,242 78,117 71,840 EBIT margin (%) 17.8 21.2 21.3 20.5 18.0 Interest (net) (6,508) (5,338) (4,813) (5,811) (8,644) Normalised profit before tax (2) 71,757 68,963 71,429 72,306 63,196 (%) 16.3 19.7 19.9 18.9 15.9 Tax expense on normalised profit (19,837) (19,712) (21,290) (21,467) (18,273) Normalised effective tax rate (%) 27.6 28.6 29.8 29.7 28.9 Normalised profit after tax (2) 51,920 49,251 50,139 50,839 44,923 Significant items after tax - - - (7,597) (1,037) Net profit after tax from continuing operations 51,920 49,251 50,139 43,242 43,886 Profit from discontinued operations (net of income tax) 1,761 4,420 4,113 50,802 - Net profit after tax for the period 53,681 53,671 54,252 94,044 43,886 Net cash from operating activities 54,924 57,171 39,158 67,630 60,952 Capital expenditure 3,628 5,281 12,475 4,326 12,317 Net debt (3) 88,420 79,756 97,729 141,930 144,841 Shareholders' equity 307,698 320,603 333,401 286,756 279,731 OTHER RATIOS AND STATISTICS Interest cover (times) (4) 14.3 17.1 19.6 23.5 13.6 Gearing: net debt/(net debt + equity) (%) (8) 22.3 19.9 22.7 27.5 28.4 Return on shareholders' equity (%) 17.4 16.7 16.3 32.8 15.7 Dividend payout ratio - Group (%) (5) 81.4 81.1 87.4 51.9 69.2 Dividend payout ratio - Normalised Continuing (%) (5) 84.1 88.4 94.7 96.0 67.6 Dividend per share (cents) (6) 16.0 16.5 18.0 18.5 11.5 Franking (%) 100 100 100 100 100 Share price (30 June) ($) 2.09 3.15 3.40 3.42 2.77 Dividend yield at 30 June share price (%) 7.7 5.2 5.3 5.4 4.2 Number of employees 876 760 757 665 629 Basic earnings per share (cents) - Group 19.7 20.3 20.6 35.6 16.6 Basic earnings per share (cents) - Continuing 19.0 18.7 19.0 16.4 16.6 Normalised basic earnings per share (cents) - Continuing 19.0 18.7 19.0 19.3 17.0 The Door and Access Systems' business has been sold with an effective date of 3 July 2018. During the year ended 30 June 2016, the Gliderol business was sold with an effective date of 31 July 2015. Accordingly, the operating activities of Door and Access Systems were classified as discontinued in FY18 and FY17, and Gliderol classified as discontinued operations in FY16, and presented separately from the results of continuing operations. FY16 includes the operating activities of Door and Access Systems as part of continuing operations. Continuing operations includes the contribution from Methven from the effective date of acquisition, 10 April 2019. Normalised profit before significant items is a non-IFRS financial measure reported to provide a greater understanding of the underlying business performance of the Group. The disclosures are extracted or derived from the financial reports and have not been subject to review or audit. The non-IFRS financial measures included in this table exclude significant items that are detailed in the relevant years' financial reports. (3) Net debt reflects the Group's borrowings and bank guarantees less cash (including cash classified within assets held for sale). (4) Interest cover (times) is calculated using EBITDA excluding non-recurring other significant items divided by net interest expense. Dividend payout ratio is calculated as the Dividend per share (cents) divided by the relevant Basic EPS. Basic EPS is calculated using the weighted average number of ordinary shares at 30 June. Dividend per share includes ordinary and special dividends. AASB16 Leases and the May 2020 IFRS Intepretation Committee decision on 'Multiple Tax Consequences of Recovering an Asset' have been adopted from 1 July 2019 (FY20), with retrospective restatement of FY19 made. FY16-FY18 has not been restated. Equity for the purposes of gearing excludes the retained earnings impact from the adoption of the May 2020 IFRS Intepretation Committee decision on 'Multiple Tax Consequences of Recovering an Asset'. GWA GROUP LIMITED | 2020 ANNUAL REPORT | 1 Company Profile We make life better for all our stakeholders GWA Group Limited (GWA) listed on the Australian Securities Exchange in May 1993 and is a leading innovator, designer and supplier of product solutions, services and intelligent technology focused on the water solutions segment. We own and distribute market-leading brands and state of the art product solutions across our ranges of sanitaryware, tapware, showers, basins, baths, kitchen sinks, laundry tubs, bathroom/kitchen accessories and valves. We have an intelligent bathroom system incorporating IoT smart water management solutions. GWA operates a central-led business with corporate functions supporting our water solutions business. We have sale and distribution facilities across our primary end markets of Australia, New Zealand, United Kingdom and China. We are highly respected within the building industry for innovation, water efficiency, product reliability and quality, technical expertise and superior service. We maintain cost efficient long term supply agreements with selected, exclusive manufacturing partners across Asia and Europe, and with light manufacturing operations in New Zealand and China. GWA has an experienced senior management team in R&D, design, brand building, customer engagement, supply and distribution. GWA remains committed to growing shareholder value through our focus on superior solutions for water and has strong market positions, market-leading brands and significant growth opportunities. GWA is a member of the ASX 200 index of listed Australian companies. OUR BRANDS 2 | GWA GROUP LIMITED | 2020 ANNUAL REPORT This is an excerpt of the original content. To continue reading it, access the original document here .