Results for the half year ended 31 December 2009

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Results for the half year ended 31 December 2009 Powered By Docstoc
					                                                                                     WATTYL LIMITED
                                                                                     ABN 46 008 412 173

                                                                                     Level 4, 2 Burbank Place
                                                                                     Norwest Business Park
                                                                                     Baulkham Hills, NSW 2153
                                                                                     AUSTRALIA

                                                                                     Tel: +61 2 9813 3333
                                                                                     Fax: +61 2 9813 3344

                                                                                     16 February 2010


        Announcement to Australian Securities Exchange


         Results for the half year ended 31 December 2009
ALL DOLLARS ARE IN AUD UNLESS OTHERWISE STATED

        Sales revenue flat at $198.2m
        EBIT increased to $7.0m
        Gearing reduced to 20.7%
Wattyl Limited (“Wattyl” or the “Group”) recorded a profit after tax of $2.4 million for the half year
ended 31 December 2009. This result is a significant improvement over the loss of $1.5 million
(before non-recurring items) reported for the prior corresponding period in 2008. This improved
profit was achieved on flat sales of $198.2 million ($199.6 million last year) and was largely the result
of the cost and margin improvement initiatives implemented during the prior 12 months.
Earnings Before Interest and Tax (EBIT) of $7.0 million was also substantially ahead of the $1.3 million
reported for the prior corresponding period. The reduction in bank debt resulted in lower finance
costs of $2.9 million ($3.7 million last year).
Net debt decreased by $5.6 million in the period under review to $32.5 million ($71.6 million as at 31
December 2008). This reduction in debt resulted in a lower gearing ratio (net debt to net debt plus
equity) of 20.7% at 31 December 2009. In October 2009 a new two year banking facility was finalised
with Wattyl’s banker.

                                                                     31 Dec 2009             31 Dec 2008
Results Summary
                                                                        $ million               $ million
Continuing operations – before non-recurring items

Sales                                                                       198.2                   199.6
EBIT (earnings before interest and tax)                                        7.0                     1.3
Net interest                                                                 (2.9)                   (3.7)
Profit / (Loss) before tax                                                     4.1                   (2.4)
Income tax                                                                   (1.7)                     0.9
Profit / (Loss) after tax                                                      2.4                   (1.5)
Non-recurring items and discontinued operations (after tax)                      -                   (4.1)
Profit / (Loss) after tax – reported                                           2.4                   (5.6)
Earnings per share (cents)                                                     2.9                   (6.7)
Ordinary dividends for the period (cents) – fully franked                      Nil                     Nil


                                                                                                   Page 1 of 3
Whilst there has been an improvement in both the profits of the Group and gearing, the economic
outlook still remains uncertain and consequently the directors have resolved to not declare an
interim dividend. The directors are aware that many Wattyl shareholders rely on dividends and it is
the intention of the directors to resume the payment of dividends as soon as fiscally prudent.


Australia

                                                          31 Dec 2009     31 Dec 2008
Results for the half year to                                                               Change %
                                                             $ million       $ million
Sales                                                           177.7           178.2           (0.3)
EBIT - before non-recurring items                                  6.2             0.7           767
EBIT - reported                                                    6.2           (4.6)           n/a

In Australia sales were 0.3% below those of the previous half year. This result was achieved
notwithstanding a decline in overall paint industry volumes of 5.6% for the same period in the prior
year.

The Australian business has secured profit improvements despite the impact of declining industry
volumes. Execution of key sales and marketing initiatives is ongoing and the rollout of the new
Wattyl colour selector system continues to be well received in the marketplace.

Significant reductions in operating expenses were achieved following the implementation of cost
management initiatives during FY2009. These savings have offset inflationary pressure and
contributed positively to the improved EBIT result compared to the previous half year.


New Zealand

                                                          31 Dec 2009     31 Dec 2008
Results for the half year to                                                               Change %
                                                             $ million       $ million
Sales                                                            20.5             21.4          (4.5)
EBIT - before non-recurring items                                  0.8             0.6          40.4
EBIT – reported                                                    0.8             0.1         816.0

Sales in New Zealand declined 4.5% as the residential construction sector continues to be adversely
impacted by the economic downturn. Effective cost management has contributed to the $0.2 million
improvement in EBIT before non-recurring items to $0.8 million.


Non–recurring items
There were no non-recurring items included in the half year. The prior year reported result included
the following items

                                                                         31 Dec 2009     31 Dec 2008
                                                                            $ million       $ million
Restructuring costs                                                          -                  (5.8)
Tax benefits relating to non-recurring items                                 -                    1.7
Non-recurring items after tax                                                -                    4.1



                                                                                           Page 2 of 3
Outlook

Housing Industry bodies in Australia and New Zealand are forecasting an improvement in housing
starts in 2010. However, this outlook must be tempered by the uncertainty created by the prospect
of higher interest rates and the withdrawal of government stimulus initiatives. In light of these
factors modest growth is anticipated in 2010.

Management will maintain control over input costs, continue to strengthen Wattyl’s brands and
focus on revenue growth.

Broker reports estimate FY2010 EBIT between $12 million and $13 million. In view of the above we
expect full year EBIT broadly in line with consensus.




For further information:
Tony Dragicevich, Managing Director, on (02) 9813-3301
Emmanuel Zammit, Chief Financial Officer, on (02) 9813-3303




                                                                                        Page 3 of 3
                 WATTYL LIMITED
               A.B.N. 46 008 412 173

     RESULTS FOR ANNOUNCEMENT TO MARKET



 PRELIMINARY FINAL REPORT – ASX LISTING RULE 4.3A

FOR THE FINANCIAL HALF YEAR ENDED 31 DEEMBER 2010
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3URILW  /RVV DIWHU WD[ ² UHSRUWHG                                                                   
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(%,7  UHSRUWHG                                                                                           QD

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(%,7 ± UHSRUWHG                                                                                        

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3ULFHZDWHUKRXVH&RRSHUV                                                                                  )HEUXDU\ 




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6DOHV 5HYHQXH                                                                              D                     
2WKHU 5HYHQXH                                                                              E                                
5HYHQXH IURP FRQWLQXLQJ RSHUDWLRQV                                                                                  


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5DZ PDWHULDOV DQG FRQVXPDEOHV XVHG                                                                                 
(PSOR\HH EHQHILWV H[SHQVH                                                                                          
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)LQDQFH &RVWV                                                                                                        
2WKHU H[SHQVHV                                                                             G                    
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,QFRPH WD[ H[SHQVH  EHQHILW                                                                                       


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&DVK DQG FDVK HTXLYDOHQWV                                                                                                      
7UDGH DQG RWKHU UHFHLYDEOHV                                                                                                  
,QYHQWRULHV                                                                                                                  
'HULYDWLYH ILQDQFLDO LQVWUXPHQWV                                                                                                            
&XUUHQW WD[ DVVHWV                                                                                                                      
7RWDO FXUUHQW DVVHWV                                                                                                   


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3URSHUW\ SODQW DQG HTXLSPHQW                                                                                                
'HIHUUHG WD[ DVVHWV                                                                                                          
,QWDQJLEOH DVVHWV                                                                                                            
7RWDO QRQFXUUHQW DVVHWV                                                                                               
7RWDO DVVHWV                                                                                                           
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%DQN RYHUGUDIW                                                                                                                          
7UDGH DQG RWKHU SD\DEOHV                                                                                                     
3URYLVLRQV                                                                                                                   
%RUURZLQJV                                                                                                                            
2WKHU                                                                                                                                    
7RWDO FXUUHQW OLDELOLWLHV                                                                                                


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%RUURZLQJV                                                                                                                       
'HIHUUHG WD[ OLDELOLWLHV                                                                                                        
3URYLVLRQV                                                                                                                      
5HWLUHPHQW EHQHILW REOLJDWLRQV                                                                                                    
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7RWDO QRQFXUUHQW OLDELOLWLHV                                                                                                
7RWDO OLDELOLWLHV                                                                                                      
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3URILW IRU WKH SHULRG                                                                                                             
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7RWDO FRPSUHKHQVLYH LQFRPH                                                                                                   


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'LYLGHQGV SDLG RU SURYLGHG                                                                                                                
(PSOR\HH VKDUH RSWLRQV                                                                                                               
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5HFHLSWV IURP FXVWRPHUV                                                                                                     
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,QWHUHVW UHFHLYHG                                                                                                                     
%RUURZLQJ FRVWV                                                                                                               
,QFRPH WD[HV SDLG                                                                                                               
1HW FDVK LQIORZ  RXWIORZ IURP RSHUDWLQJ DFWLYLWLHV                                                                          


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3D\PHQW IRU SXUFKDVH RI LQWDQJLEOH                                                                                                    
3URFHHGV IURP VDOH RI SURSHUW\ SODQW DQG HTXLSPHQW                                                                                   
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3URFHHGV IURP VKDUH LVVXH                                                                                                                
3URFHHGV IURP ERUURZLQJV                                                                                                      
'LYLGHQGV SDLG                                                                                                                     
5HSD\PHQW RI ERUURZLQJV                                                                                                      
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1HW LQFUHDVH  GHFUHDVH LQ FDVK KHOG                                                                                          
&DVK KHOG DW WKH EHJLQQLQJ RI WKH SHULRG                                                                                       
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&DVK DQG FDVK HTXLYDOHQWV KHOG DW WKH HQG RI WKH SHULRG                                                                         

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5HYHQXH IURP H[WHUQDO FXVWRPHUV                                                                             

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,QWHUHVW UHYHQXH                                                                                                               
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6DOH RI JRRGV                                                                              

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,QWHUHVW LQFRPH                                                                                      
2WKHU UHYHQXH                                                                                        
                                                                                                     
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)RUHLJQ H[FKDQJH JDLQ                                                                                 
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)UHLJKW                                                                                       
+HDW /LJKW 3RZHU                                                                              
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0RWRU YHKLFOH H[SHQVHV                                                                         
&RPPXQLFDWLRQV                                                                                 
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1RQGHGXFWLEOH H[SHQVHV                                                                                                      
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&DVK DW EDQN DQG RQ KDQG                                                                                             
6KRUW WHUP GHSRVLWV                                                                                                            
                                                                                                                     
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%DODQFHV DV DERYH                                                                                                    
%DQN RYHUGUDIW                                                                                                             
&DVK SHU 6WDWHPHQW RI &DVK )ORZV                                                                                     

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&XUUHQW ± EDQN ORDQV                                                                                                        
1RQFXUUHQW ± EDQN ORDQV                                                                                               
                                                                                                                        
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posted:3/31/2010
language:English
pages:28
Description: Results for the half year ended 31 December 2009