Headlines

• • Revenue of $133.5m was up 5.9% on 1H20, driven by strong growth in Q2, where revenue exceeded the prior period by over 7% on a like for like basis. The growth also reflected contribution from the Pine Design acquisition completed in March 2020.
• • Comparable store sales grew 1% in 1H21, as construction sector trends turned more positive after declining for the previous 2 years.
• • Queensland, SA, WA and ACT all experienced strong sales growth results, while NSW and Victoria trailed the corresponding period, where the continued decline in multi-residential building impacted the most.
• • Underlying EBITDA of $10.0m, was up 14.8% on 1H20, with a particularly strong result from manufacturing operations being the highlight. • Underlying NPAT of $3.1m, was up 38.8% on the 1H20 result, and well ahead of the guidance provided in the Timberwood acquisition capital raise documents released to the market in December 2020.
• • On 3 November 2020, the Company announced the decision to consolidate the Company’s two plywood manufacturing sites onto a single site at Grafton. This decision was triggered by the impact to the long term wood supply available to the Wagga Wagga site following the major fires in the region in early 2020, and the successful awarding of $10m to the Company under the Government’s Bushfire Grants scheme. Whilst this has resulted in non-cash asset impairment during the period of $9.4m, the impact on both future earnings and cash flow of the project are very positive.
• • Working capital continued to be tightly managed, with cash conversion of 77% (or ~ 100% when the impact of deferred government covid-19 payments is adjusted). This was achieved despite some changes in the Company’s supply chain that saw materially higher volumes of imports.
• • The Board have determined a final dividend of 2.6 cents per ordinary share, fully franked. The Company’s dividend reinvestment plan (“DRP”) will be in effect for this dividend.