Full Year 2024 DGL Group Ltd Earnings Call Transcript
Key Points
- DGL Group Ltd (ASX:DGL) achieved a compound annual growth rate of 32% in revenue from FY21 to FY24, reaching $465 million.
- The company expanded its capacity for storing, manufacturing, and transporting chemicals, contributing to meaningful volume growth.
- DGL Group Ltd's gross margin increased by 16% year-on-year, driven by raw material procurement benefits and improved product mix.
- The company has made significant investments in organic growth projects, internal system enhancements, and a shared services platform, expected to benefit future earnings.
- DGL Group Ltd has a strong balance sheet with significant tangible assets of $340 million, providing a solid platform for future growth.
- Net profit after tax decreased due to increased finance charges, depreciation, and reinvestment into shared services.
- Operating cash flows decreased from $59.3 million in FY23 to $37.3 million in FY24, impacted by higher financing costs.
- The environmental division faced challenges due to supply constraints in the Used Lead Acid Battery market, reducing utilization and gross margin.
- DGL Group Ltd experienced cost inflation in wages and insurance, contributing to increased operating expenses.
- The company is facing increased domestic competition in some industries, particularly in the environmental services sector.
Good morning, ladies and gentlemen. Simon Henry, CEO and Founder of DGL, here to present our FY24 financial results. Joining me on this call today is Frank Izzo, our CFO; and Alex Wing, our COO.
And now we'll page turn through the pack. Let's start on slide 3. DGL is a leading provider of chemicals, and materials, and services to essential industries throughout Australia and New Zealand.
Turning to slide 6. High-level financial numbers, revenue is broadly in line with expectations. EBITDA once again broadly in line with expectations. Net profit after tax is down primarily as a result of increased finance charges, depreciation and our reinvestment into developing out our shared services across the Group. Once again, our cash flows from operations is down as a result of -- primarily as a result of higher interest rates.
Turning to slide 7. Key drivers throughout FY24. We had meaningful volume growth of production and logistics through our various operations. We managed to expand our capacity, both
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