Half Year 2024 James Fisher and Sons PLC Earnings Call Transcript
Key Points
- Underlying operating profit increased by 20%, driven by strong performance in well services, tank ships, and submarine rescue platforms.
- Significant reduction in net debt, with GBP100 million realized from the sale of non-core businesses.
- Improved cash management and collection, with a net working capital inflow of GBP12.2 million.
- ROCE increased to 7.5%, reflecting a 200 basis point uplift due to improved profitability and contract discipline.
- Strong demand in core markets such as oil and gas, offshore wind, and defense, with a healthy order book and pipeline.
- Revenue declined by 12.1% year-on-year, primarily due to business closures and the cessation of the Swordfish vessel operations.
- Net debt to EBITDA ratio remains high at 2.6x, although it is expected to reduce further by year-end.
- Corporate costs increased by GBP2 million, reflecting higher investment in capabilities and improvement initiatives.
- Challenges in the subsea and decommissioning business, with insufficient sales growth to offset losses.
- Higher finance charges, up from GBP8.7 million to GBP14 million, due to increased interest costs and fees.
Good morning, everyone. Thank you for joining our 2024 interim results earnings call. I am pleased to be joined by our Chief Financial Officer, Karen Hayzen-Smith and together, we will provide an update on our business turnaround and the program (technical difficulty) to reduce our net debt in support of a stronger, more sustainable business.
I will start by walking through our 1H '24 Business Highlights aligned to our transformation strategy. Karen will then provide an overview of our financial results at Group and divisional levels, which are an outcome of the work we are doing on our turnaround. I will then provide a strategic update and a market outlook.
So let's start with the highlights from our first half of the year. We are now about halfway through our business turnaround, and we are making progress through focus and simplification. Our first half performance was in line with expectations, while revenue was down 12.1% year on year. Underlying operating profit was up by 20%, mainly due to the
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