Earnings growth was impressive for the financial year with earnings before interest, tax and amortisation (EBITA) increasing by 17.3 per cent on the prior year, to $91.2m. This exceeded the anticipated range of $85-90m. Salmat’s reported sales revenue slipped by 1.3 per cent to $878.8m, while its normalised revenue rose by 1 per cent to the 878.8m figure.
Net profit after tax, but before significant items, increased by 43.8 per cent to $47.4m. Net profit after tax and after significant items was up 42.5 per cent to $49.1m. Salmat’s improved profitability led to an earnings per share of 31.1 cents: an increase of 43.3 per cent.
The results are from the first full year without Salmat’s founders Peter Mattick and Phil Salter at the helm, they both retired from active roles in the business in January 2009.
Grant Harrod, CEO of Salmat says, “The results reflect a strong focus on streamlining and consolidating the Salmat business while aligning our suite of services through the One Salmat strategy to drive profitable growth.”
Salmat’s strong position and the Board’s confidence in the company’s future led to the declaration of a final dividend of 12.5 cents, bringing the full year dividend total to 23.5 cents per share, fully franked – a 17.5 per cent increase on the prior year. The Board has also declared a special dividend of 10.0 cents per share fully franked, bringing the total dividend to 33.5 cents per share, up 67.5 per cent on the previous year.
Harrod says, “Our financial position is very positive, with excellent cash flow and plenty of headroom on our finance facilities. During the year, we managed to reduce our debt by more than $33m, with net debt standing at $134.3m by year end.”
The company says cost control, productivity and margin enhancement programs have been very successful and have delivered excellent results during the year. Importantly, Salmat has made significant progress in delivering on its One Salmat strategy, which aims to package all its services into an extremely compelling ‘one stop’ multi-channel communication solution for its clients, substantially improving the return on their marketing investment.
Salmat says it anticipates that market conditions will remain fairly consistent over the next twelve months and that clients will continue to seek business solutions that drive revenue and enhance competitive advantage. “With our strong cash flow and solid new business pipeline, we are in a prime position to capitalise on opportunities within our existing client base; extend into new markets such as the Small to Medium Enterprise (SME) space; and pursue strategic acquisition targets.” Harrod said.
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