Aluminium specialist, Capral, is a leading supplier for Australia’s trailer building industry.
The company, according to a 2020 full year results presentation, has six plants and nine extrusion presses as well as 18 distribution centres nationwide.
Capral has more than 800 employees and manages an annual extrusion capacity of 65,000 tonnes.
The business reported annual turnover for the 12 months to 31 December 2020 of $432 million.
Tony Dragicevich, Capral CEO and Managing Director, outlined full year earnings ahead of guidance, very strong second half profit and cash flow, and continuation of dividend as key FY2020 highlights.
- Trading EBITDA of $19.7 million (FY2019: $11 million) and EBITDA of $47.2 million (including JobKeeper: $11.9 million) (FY2019: $19.9 million).For the second half of 2020 (2H20) trading EBITDA was $13.9 million due to strong sales peformance, improved operating leverage and sales realised from business initiatives.
- Volumes were up 7.6 per cent on the prior period to 61,000 tonnes with buoyant conditions in 2H20.
- Capral posted a strong balance sheet and net cash of $49.4 million.
- Normalised earnings per share at 66 cents.
- Final dividend declared at 45.0 cps (fully franked), up on 2019 which was impacted by structuring costs and in line with 2018.
- Market share also gained against imports.
- The major restructure of Bremer Park facility was completed, realising a further $5 million savings in FY2020.
- Market conditions in the residential building sector reportedly improved on the back of the government stimulus.
- Key investment in Smithfield, New South Wales, extrusion capacity contributed positively to Q2 FY2021.
- The total reportable lost time and medically treated injuries per million work hours was the best on record at 5.8 (FY2019: 11.4).
Capral continued to operate throughout the period of Covid restrictions and a number of initiatives were implemented to safeguard employees and the business.
Notably, Capral qualified for JobKeeper in May allowing all Capral employees’ jobs to be retained. The JobKeeper funds set aside were invested in job creating capital projects such as the Smithfield extrusion plant acquisition 2021 ($9 million) and NSW paint line 2022 ($3 million).
The Smithfield acquisition is expected to contribute from Q@ FY2021 onwards.
Despite new truck and van builds being down 9.2 per cent from 2019, transport has started to lift. The industrial sector is rebounding.
Dragicevich summarised Capral’s strategy and outlook: “Deliver benefits from capital resourcing investments to further improve Capral’s long term competitive position”.