Steel & Tube buys Composite Floor Decks for $13.3 mln

Friday 14 October 2016 04:56 PM

Steel & Tube buys Composite Floor Decks for $13.3 mln

By Sophie Boot

Oct. 14 (BusinessDesk) - Steel & Tube Holdings will buy Composite Floor Decks, which supplies and installs composite floor decking, for $13.3 million, with a further $3 million possible based on its performance over the next two years.

The company has been Steel & Tube’s distributor and installer of composite metal floor decking since 2005, Steel & Tube said in a statement. It had 2016 revenue of $18 million and $4.3 million in earnings before interest, taxation, depreciation and amortisation, while the forecast for the 2017 financial year is revenue of $22 million and ebitda of $5.5 million.

In August, the Lower Hutt-based company reported an underlying profit of $19.4 million in the year ended June 30 on record sales of $516 million as the contribution from new acquisitions and cost savings helped offset weaker prices and margins and costs related to quality issues.

“With Steel & Tube having the license to manufacture and market ComFlor, the acquisition means we enhance our supply chain capabilities, creating an end-to-end process from manufacture through to installation," chief executive Dave Taylor said. The purchase will be completed on Oct. 31.

Steel & Tube's shares last traded at $2.19, and have fallen 4 percent this year. It was a member of the S&P/NZX50 benchmark index until September, and dropped out after the value of its shares hit their lowest level since 2001 in June at $1.79 following a difficult few months.

(BusinessDesk)

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