Fleetwood Limited – H1FY25 Interim Results Summary
Overall Report Tone
Fleetwood Limited delivered strong revenue growth (+19%), with significant EBIT improvement (+$12M YoY), driven by Building Solutions and Community Solutions. Despite challenges in RV Solutions, cash flow improved, and the company increased its dividend to 11.5cps, highlighting confidence in future earnings.
Financial Performance Overview
| Metric | H1FY25 | H1FY24 | Change ($) | Change (%) |
|---|---|---|---|---|
| Revenue | $272.7M | $229.9M | + $42.8M | +19% |
| EBITDA | $25.2M | $14.5M | + $10.7M | +74% |
| Underlying EBIT | $18.3M | $6.3M | + $12.0M | +190% |
| Net Profit After Tax (NPAT) | $4.7M | $3.9M | + $0.7M | +18% |
| Free Cash Flow | $21.6M | -$10.6M | + $32.2M | +300% |
| Order Book | $137M | $100M | + $37M | +37% |
| Dividend (fully franked) | 11.5 cps | 2.5 cps | +9.0 cps | +360% |
Key Insights & Business Developments
📈 Revenue Growth & Business Performance
- Building Solutions: Revenue +17.7% to $202.6M, EBIT up +121.9% to $7.1M, supported by education and housing projects.
- Community Solutions: EBIT surged +257% to $16.8M, driven by Searipple Village occupancy increasing to 71% (from 34%).
- RV Solutions: Struggled due to OEM market weakness, posting a $0.7M loss, leading to $6M goodwill impairment and $1.9M restructuring costs.
💰 Profitability & Cash Flow
- Free Cash Flow of $21.6M (vs. -$10.6M in H1FY24), driven by working capital improvements.
- Strong balance sheet, closing cash of $57.5M (up $23.5M).
- Capital management includes a share buyback of $1.1M.
🚀 Strategic Developments
- Building Solutions: $137M order book, with $200M+ in pending tenders.
- Community Solutions: Securing long-term contracts for Searipple Village, with 81% occupancy locked in for FY25.
- RV Solutions: Focus on cost reduction and price adjustments to return to profitability in H2FY25.
Result vs Market Expectations
✅ Revenue and EBIT exceeded expectations, driven by Building & Community Solutions growth.
✅ Cash flow turnaround (+$32.2M YoY) reflects strong working capital management.
⚠️ RV Solutions impairment ($6M) and restructuring costs ($1.9M) highlight ongoing challenges in the caravan market.
✅ Dividend of 11.5 cps significantly higher than 2.5 cps in H1FY24, demonstrating confidence in earnings momentum.
Outlook & Guidance
🔹 Building Solutions:
- Strong pipeline, with $200M+ in tenders awaiting award.
- 15% return on capital target expected to be achieved earlier than planned.
- Continued expansion in education and housing projects.
🔹 Community Solutions:
- Searipple Village occupancy secured at 81% for FY25 and 73% for FY26.
- Opportunities in Build to Rent (BTR) and key worker accommodation.
🔹 RV Solutions:
- Cost-cutting initiatives and pricing adjustments expected to return the segment to profitability in H2FY25.
Market Positioning
Shares in the Fleetwood were strong coming into this result.
Analyst Positioning
1. Revenue Forecasts:
- H1FY25 Revenue: $272.7M (up 19% YoY from $229.9M)
- This suggests that FY25 revenue may exceed the current analyst estimate of $466.05M if this growth rate continues in H2FY25.
- However, some seasonality effects in Building Solutions (lower activity in H2 due to installations) may moderate full-year growth.
- Revision Expectation: Analysts may slightly increase their FY25 revenue forecasts, particularly if contract momentum remains strong.
2. EBITDA Forecasts:
- H1FY25 EBITDA: $25.2M (up $10.7M YoY, or +74%)
- Analyst expectations for FY25 EBITDA are $52.15M, meaning the company has already delivered nearly 50% of that in H1.
- Given that EBITDA momentum is strong and cost-saving measures (RV Solutions restructuring) are expected to improve margins further in H2, full-year EBITDA may surpass the current forecast.
- Revision Expectation: Analysts are likely to increase their FY25 EBITDA forecasts, given the strong H1 performance and ongoing cost optimizations.
Final Takeaway:
- Revenue: Mild upward revision possible if H2 maintains strong contract execution.
- EBITDA: Upward revision highly likely due to stronger-than-expected margin expansion and cost efficiencies.
Disclaimer: This information is provided purely for educational purposes. It takes no account of an individual’s personal financial circumstances and hence can in no way constitute financial advice. The above data may be subject to errors or inconsistencies for which the author takes no liability. It is imperative that all investors do their own research or if they need advice, seek it from a qualified financial adviser.
Quick Take: H1FY25 ASX:FWD