Hellaby first-half profit jumps 36%, sees full-year earnings growth

Thursday 19th February 2015

Hellaby Holdings posted a 36 percent gain in first half profit, driven by improved performance in four of the diversified investor's five businesses, and said it on track to lift full year earnings.

Profit rose to $13.5 million in the six months ended Dec. 31, from $9.9 million a year earlier, the Auckland based company said in a statement. Sales rose to $386.9 million from $351.6 million.

Hellaby managing director John Williamson said the firm's spread of businesses, from oil & gas industry services through to footwear stores has helped the company spread its risk in the face of variable market conditions. The first half results include the first full period of contribution from auto electrical parts wholesaler Dasko and truck servicing firm NZ Trucks, acquired in early 2014 and added to its automotive and equipment divisions respectively. Automotive operating earnings rose 13 percent to $12.4 million and equipment earnings rose 8.3 percent to $5.2 million in the first half.

"Hellaby's strategy to expand through operational growth and value accretive acquisitions is continuing to deliver," said chairman Steve Smith. "With gearing at 28.3 percent, Hellaby remains well positioned to fund future growth opportunities."

The shares rose 5 percent to $3.35. The shares are up 4 percent in the past 12 months, and are rated an average 'buy' based on four analyst recommendations compiled by Reuters, with a median price target of $3.43.

Hellaby will pay a first half dividend of 9 cents a share, up from 5.5 cents a year earlier.

The company's oil & gas services division lifted operating earnings to $12.1 million from $8.5 million, while footwear, which owns the Hannahs and Number One Shoes stores, reported earnings of $900,000, up from $700,000.

The packaging division earnings fell to $1.6 million from $2.1 million, which the company said reflected a "major manufacturing relocation project which nonetheless provides a platform for long term growth."

BusinessDesk.co.nz

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