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Trading result for the year ended 30 June 2011

[Attached:
SKL_Results_BriefingJune_11.pdf
SKL_Appendix_1_June_2011.pdf
SKL_Appendix_7_Aug_11.pdf]

25 August 2011

Skellerup Holdings Limited

Trading result for the year ended 30 June 2011

Key points

•Continuing Operations Revenue up 7.1% to $193.6 million

•Continuing Operations audited Net Profit after Tax (NPAT) up 68.9% to $20.2 million

•Net Debt reduced from $26.9 million to $9.1 million

•4.0 cents per share dividend (fully imputed), to be paid on 21 October 2011

•Earnings per share of 10.50 cents up 54% from 6.81 cents

Summary

Skellerup has today announced a record audited Net Profit after Tax (NPAT) of $20.2 million for the year ended 30 June 2011 – an increase of $8.2 million, or 68.9%, on the previous year.

Adjusting last year’s result for one-off costs incurred of $2.5m, the increase is 39.7%.

This year’s result is an especially pleasing performance given the disruption the company has experienced in Canterbury. It reflects an improved trading environment as our customers recover from the impact of the global financial crisis, gains from winning new business through our focus on new products and the benefits of ongoing operational improvements.

Industrial Division sales for the year were 7.6% ahead of the previous year, reflecting good growth in demand for most industrial products, but particularly the sale of industrial vacuum pumps into the North American oil and natural gas exploration markets.

Agri Division sales for the year were 4.9% ahead of the previous year, as a result of on-going demand from the dairy industry for our range of consumable products. The Quatro and Red Band gumboot continues to be well received in the New Zealand market. Demand for items of a capital nature, such as dairy vacuum pumps, has improved reflecting a more positive outlook for dairying as a consequence of improved milk solid prices over the past year.

Financial summary

 Year to 30 June 2011 $000(audited)Year to 30 June 2010 $000(audited)2nd Half Year to 30 June 2011 $000(Unaudited)2nd Half Year to 30 June 2010 $000(Unaudited)
Continuing operations 
Total Revenue193,593180,71997,39695,416
Earnings before interest and tax32,22721,69016,75514,324
Less finance costs2,6674,7851,2972,355
Profit before tax29,56016,90515,45811,969
Less taxation9,3604,9475,0873,286
Net profit after tax20,20011,95810,3718,683

Debt Reduction

Group debt reduced during the year from $26.9 million to $9.1 million – a result of strong earnings growth. As at the end of the financial year, the percentage of debt to debt-plus-equity improved from 21.0% to 7.6%.

Dividend

The Company’s dividend policy is to return to shareholders each year a total dividend payout of between 40% and 60% of NPAT. Accordingly, the directors have resolved to pay a final dividend of 4.0 cents per share on 21 October 2011, to shareholders on the register at 5pm on 07 October 2011.

Given the strong financial position of the Company, the Dividend Reinvestment Plan will not be operative for this dividend payment.

CEO Appointment

On behalf of the Board of Skellerup Holdings Limited, Chairman Sir Selwyn Cushing is pleased to announce the appointment of Mr David Mair as Chief Executive Officer of the Company.

Mr Mair has been Acting Chief Executive for the past 12 months and has been a director of the Company since November 2006.

Mr Mair is a former Executive Director of Interlock Group, Vice President of Asia Pacific Operations and Operational Council Member of ASSA ABLOY (Sweden).

Sir Selwyn says “Mr Mair’s knowledge of the business, and previous international and investment experience, will be of real benefit to the Company."

Mr Mair says he is very much looking forward to leading the company. He sees significant opportunities to continue to grow the business internationally.

Annual Meeting

Skellerup’s Annual Shareholders’ Meeting will be held at Eden Park, Auckland, on Wednesday 26 October 2011, at 2.30 pm.

Canterbury Earthquakes
Skellerup has over 200 people working in Christchurch. Despite enormous personal difficulties arising from the Canterbury earthquakes, our staff has worked hard to quickly return our business to normal operations. Without this exceptional effort, our customers would have been inconvenienced and our reputation for reliability would have been damaged.

Looking Ahead

We consider the outlook for the coming year is positive for both divisions with earnings at the NPAT level for the June 2012 year expected to be within the range of $22m to $23m.

ENDS

[Attached:
SKL_Results_BriefingJune_11.pdf
SKL_Appendix_1_June_2011.pdf
SKL_Appendix_7_Aug_11.pdf]

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