Silly as it sounds being expensive and all I bought few days back on reading the ESG Sustainability report, the very aggressive buyback and a way to leverage the US rate cuts.

Being already 4bn market cap many things can go wrong so didn't buy too much.

In case no one realised, Reece and RWC were the two bigger companies I was looking at to leverage the water thematic outside of Waterco and the US market. The sustainability report at least gives some idea RWC knows about water conservation despite the limited product range.

https://www.rwc.com/sites/default/files/media-file-public/ESG_Report_2024.pdf

I'm hoping to see more products on water from the back of this report and R and D efforts

ESG investing is so in right now...

(Held)

Another one these companies that look expensive with elevated valuation metrics and with little or negative growth plus uncertain future growth.

1. Lots of negative growth though at least adjusted EBITDA is flat
2. Company has experienced 11% growth in EPS over past 5 years, so this could be one of those rare down years
3. In saying that, this is the lowest annual profit the company has reported since 2020
4. At share price of $4.70 the PE is 26 (based off adjusted EPS)
5. Market might be pricing in some future growth
6. Non-quantitative guidance is bearish with little growth expected:

'For the first six months of trading in FY25 RWC expects group external sales to be broadly flat, within a range of up or down by low single digit percentage points, relative to the pcp, excluding the impact of Holman and Supply Smart. RWC expects a similar trajectory in each region.'

The company did not issue any FY25 quantitative guidance because of uncertainties

AFR street walk rumors of PE sniffing around now - Soft US housing puts Reliance Worldwide in PE’s sights (afr.com)

"Street Talk’s aware of a few PE firms keeping a close eye on Reliance Worldwide, following a 20 per cent drop in its market value and knowing listing markets will fret about FY23 and FY24 revenue and earnings when the long-term story remains intact."

I haven't looked at this company in ages but the recent cold snap in the US i imagine should see a temporary bump in sales so surprised it hasn't had that first level thinking bump (everyone must be on holidays). Looks like it maybe trading at a reasonaby attractive valuation too.

RWC RESULTS FOR SIX MONTHS ENDED 31 DECEMBER 2020:   REPORTED NET PROFIT AFTER TAX RISES 82% TO $91.4 MILLION, SALES 13% HIGHER  

Net sales of $642.4 million, up 13% on the prior corresponding period  

Net sales up 17%  on a constant currency basis

Reported net profit after tax of $91.4 million, up 82%

Adjusted net profit after tax1 of $99.3 million, up 56%

EBITDA1 of $166.3 million, up 32% Strong cash generation with cash flow from operating activities up 17% to $155.6 million and operating cash flow conversion of 94% of EBITDA

Net debt reduction of $76.2 million since 30 June 2020 Americas recorded 22% constant currency sales growth for the half  

Asia Pacific constant currency sales up 14% for the period  

EMEA sales recovered strongly following COVID?19 lockdowns, up 10% for the half in constant currency  

Interim dividend 6.0 cents per share, up 33% on pcp

1 EBITDA, EBIT, Adjusted NPAT and Adjusted EPS are non?IFRS measures used by RWC to assess operating performance. These measures have not been subject to audit or review.

Disc: I hold

Presentation

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02343876-3A561786?access_token=83ff96335c2d45a094df02a206a39ff4