Vulcan Steel Limited (ASX:VSL) Reports Half-Year Financial Results
Financial Performance
Vulcan Steel Limited (ASX:VSL) reported a 12.6% decline in revenue for the first half of FY25, totaling NZ$493 million. EBITDA decreased by 30.5% to NZ$57 million, and net profit after tax (NPAT) fell by 64.8% to NZ$9 million. Operating cash flow stood at NZ$81 million, marking a 23.4% decrease compared to the same period last year. The company’s return on capital employed declined to 10.3%.
Operational Performance
Despite challenging economic conditions, Vulcan Steel maintained a stable gross margin of 35.2% and reduced group operating expenses by NZ$1.4 million. Sales volume decreased by 8.3% to 109,217 tonnes, while active trading accounts slightly increased to 22,612. The company successfully managed to lower its net debt to NZ$242 million.
Dividend Declaration
Vulcan Steel declared an interim dividend of 2.5 NZ cents per share for 1H FY25, with 100% franking and 20% imputation. The Board has adjusted the annual dividend payout policy to 40% to 80% of NPAT, aiming to balance returns to shareholders with investments for growth and recovery.
Future Outlook
The company remains focused on strengthening its foundation and capitalising on future opportunities as economic conditions improve. Vulcan Steel plans to continue its expansion through brownfield and greenfield initiatives, mergers and acquisitions, and aims to enhance its geographic and product footprint across Australasia.
Environment & Sustainability
Vulcan Steel continues its commitment to a safe and healthy work environment with the launch of the Safety Step Change Programme. Scope 1 and 2 greenhouse gas emissions remained stable at 13,865 tonnes for FY24. The company also supports local community organisations and invests in employee training and development.
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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