The operating earnings of Skellerup's industrial divisions arm increased 10 percent due to increased sales of wastewater, high-performance foam, and roofing applications. Photo: Supplied
Rubber goods manufacturer Skellerup's full-year profit is up 7 percent to $50.9 million as the company sees growth in all of its divisions, particularly its industrial portfolio.
- Net profit $50.9m vs $47.8m
- Revenue $333.5m vs $316.8m
- Net debt $26.8m vs $25.2m
- Cash flow $54.1m vs $43.3m
- Final dividend 22 cents a share vs 13 cents a share
Skellerup chief executive David Mair said he was proud of the result amid challenging global economic conditions.
"It reflects the success of our business strategy, purpose and focus," he said.
The operating earnings of the company's industrial divisions arm increased 10 percent due to increased sales of wastewater, high-performance foam, and roofing applications, he said.
"Our industrial division generates 85 percent of its revenue from international markets," Mair said.
"FY23 sales revenue growth of 5 percent was slower than in recent years.
"Strong revenue growth was realised from sales of vacuum systems for wastewater applications (most notably in the USA), sales of high-performance marine foam products (into the USA, NZ and Australia) and roof-flashing products for solar energy installations (in the UK).
"This growth was partially offset by lower sales for potable water and appliance applications as customers reduced inventories; this reflected both lower demand and an easing of supply chain pressures such as raw material shortages and freight congestion prevalent during the Covid-19 pandemic of the preceding two years."
While growth in the company's agri divisions arm was more modest, Mair said footwear sales remained strong.
"Footwear was a standout during FY23 as increased sales in NZ (hardware channels and urban markets) and the USA (electricity applications) delivered earnings growth.
"Sales volumes of dairy consumables were down as customers reduced inventories due to lower demand and an easing of freight congestion prevalent during the Covid-19 pandemic.
"Sales price adjustments in the second half of the year lagged the impact of raw material cost increases incurred in the first half; however, productivity gains helped offset the impact of lower production volumes, higher raw material prices and freight costs."
Skellerup chair John Strowger said the company was in a robust financial position.
"At Skellerup, we are often told by well-intentioned third-party commentators that we have a 'lazy' balance sheet," he said.
"It is true that we do carry low levels of debt, but in periods of uncertainty have found this to be a distinct advantage; this ensures we make the right decisions for the business in a holistic sense, rather than responding to short-term exigencies.
"It also enables us to distribute a healthy proportion of our earnings to shareholders in the form of dividends."
The company has rewarded shareholders with an increased full-year dividend of 22 cents per share.