Annual Report 2012
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Annual Report 2012 Building and renovations … it’s our business Alesco at a glance Alesco supplies innovative Contents branded products to trade Financial Overview 2-3 Chairman’s Report 4-5 customers in the Australian Managing Director’s Report 6-9 Divisional Reports 10 and New Zealand building - Garage Doors & Openers 11 - Cabinets, Windows & Appliances 12 products markets. - Construction Products & Equipment 13 Board of Directors 14-15 We operate through three divisions: Executive Team 16 Safety & Our People 17 Garage Doors & Openers Directors’ Report 18 Corporate Governance Statement 19 Cabinets, Windows & Appliances Remuneration Report 30 Financial Statements 65 Construction Products & Equipment 2012 Revenue1 Employees Listed on ASX $459.7m ~1380 ALS Group Financial Summary yeAR eNded 31 mAy 2012 2011 2010 2009 2008 Revenue ($ million) 459.7 478.8 483.6 512.7 561.9 2 NG 3 ui EBIT ($ million) 32.2 40.3 32.1 33.3 58.3 esses N N ti 3 N EBIT/Sales (%) 7.0 8.4 6.6 6.5 10.4 Busi Co Return on net operating assets4 (%) 7.0 8.5 6.7 6.7 11.7 Profit after tax($ million) -13.9 13.6 -124.3 -12.8 58.0 Return on equity (%) -3.3 3.2 -22.7 -2.2 11.2 oup Earnings per share (cents) -14.7 14.4 -132.8 -13.9 67.2 R G Dividend per share (cents) 18.0 14.0 7.0 7.0 67.0 Market capitalisation ($ million) 185.6 290.1 250.6 302.1 710.1 1. Continuing business only 2. Parbury and Dekorform businesses were sold on 31 March 2012. 3. Earnings before interest, tax and significant items. Represents segment measure of performance. 4. Earnings before interest, tax and significant items divided by average net operating assets. This report is dated 10 August 2012. Alesco Corporation Limited ABN 23 008 666 064 Garage Doors Cabinets, Windows Construction Products & Openers & Appliances & Equipment This year we have further rationalised and repositioned Alesco’s portfolio, we have strengthened our balance sheet and have continued to implement Project Restore disciplines across all our divisions. We are well-progressed through our three year programme, focussed on improving our divisions’ operational fitness and financial performance and have identified further initiatives and growth paths for the 2013 financial year. Our business model is to develop a sustainable building products business with market leading brands, capable of performing strongly at any time of the cycle. Alesco Annual Report 2012 1 Revenue1 s GaG ce raar an gae li g De p oD 35% p oo A r os & r & s s & O w pO o e d p Total n e n i e n r e s W r , s s 39% t $459.7 e n i Million b a C ts Financial Overview uc Con rod struction P t men & Equip 26% Our Safety Performance Medical Treatment Injury Frequency Rate Medical Treatment Injury Frequency Rate & Lost Time Injury Frequency Rate & Lost Time Injury Frequency Rate 50 10 50 10 1 1, 2 Revenue 40 EBIT (Before significant items) 8 40 8 30 6 30 6 ws do s GaG 24% in ce raar es an gae , W nc li g De 20 s a 4 20 4 p 35% t li p oD e p oo in p A ro s b A & r & a s & s & C s O 10 2 10 2 w r Injuries per million man hours pO Injuries per million man hours o e e d p n Total n e Total n e i e n C r p e s W 0 0 0 0 o r , O s s n 39% t $459.7 FY07 FY08 FY09$32.2 FY10 FY11 FY08 FY09 FY10 FY11 FY12 s e & t n & r i Million s u Million r b 57% E c a o q t C i o u o D ip n Medicalm TreatmentP e Medical Treatment r g Injury Frequencye o a MedicalInjury Frequency Treatment Lost Time Injury s n du ar ct 19%Rate (LHS)t c G Rate (LHS) Frequency Rate (RHS) C du ts Injury Frequency onst Pro ruction nt Lost Time Injury RateLost (LHS) Time Injury & pme Equi 26% Frequency Rate (RHS) Frequency Rate (RHS) Results at a glance 1, 2 EBIT (Before significant items) ws 24% do • 35%in improvements in LTIFR to 4.2, including the discontinued businesses. W ce s, n t lia e p 3 inNetp loss after tax of $13.9 million, down from a profit of $13.6 million (pcp) •b A a C & s r 3 Reported earnings loss e per share of 14.7 cents per share (cps), against earnings per share of 14.4 cps (pcp) • Total n e C 2 p 4, 5 o O n EBIT before$32.2 significant items of $26.1 million •s & t & r s u Million 2 r 57%4 6 E c o q t- EBIT before significant items from continuing businesses of $32.2 million, on revenue of around i o u o D ip n m P e r g e $460o million a n du ar 19% t c G - Solidts second-half performance with EBIT of $12.8 million for continuing businesses and revenue of approximately $211 million • Net profit after tax before significant items of $11.3 million7, ahead of guidance of $9.9 million to $10.7 million provided in January 20128 • Sale of loss-making Parbury and non-core Dekorform businesses for approximately $4.0 million6 • Significant items after tax totalling $25.1 million relating to asset sales and associated impairment ($20.7 million) and response costs arising from DuluxGroup Limited’s (DuluxGroup) takeover offer ($4.4 million) • Net debt of $65.9 million at year end, down from $78.1 million at 31 May 2011 with gearing at 14.0% down from 15.3% at 31 May 2011 - Strong cash generation achieved through improved working capital management and proceeds from the sold businesses • Total dividends for the year of 18.0 cps comprising a fully franked final dividend of 5.0 cps and a fully franked special dividend of 10.0 cps payable on 7 September 2012, together with the FY12 interim dividend of 3.0 cps paid in March 2012 1. For continuing businesses. 2. Earnings before interest and tax. 3. Prior corresponding period. 4. Earnings before interest, tax and significant items. Represents segment measure of performance. 5. Includes 10 months of net trading losses for the combined Parbury and Dekorform businesses until the date of sale on 31 March 2012. 6. Parbury and Dekorform businesses were sold on 31 March 2012. 7. Non-IFRS information is reported to provide a greater understanding of the Group’s underlying businesses. Further details of non-IFRS information can be found in the reconciliation to statutory profit on page 3. 8. On 25 January 2012, the Alesco Board confirmed that assuming there was no further market deterioration from current forecasts, net profit after tax before significant items for continuing businesses for the full-year ending 31 May 2012 was likely to be down by between 30% to 35% from the prior corresponding period ($15.3 million). This equated to a range of between $9.9 million and $10.7 million. 2 Alesco Annual Report 2012 Key Financial Indicators Earnings per share (cents)1 Dividends per share (cents) Return on net Return on equity (%) operating assets (%)4 11.7 67.2 67.0 11.2 8.5 3.2 14.4 7.0 6.7 6.7 08 11 08 11 09 10 12 09 10 12 -13.9 -14.7 -2.2 -3.3 18.03 14.02 7.0 7.0 08 09 10 11 12 08 09 10 11 12 -132.8 -22.7 Total Shareholder Returns, Share Price and Dividends to 31 May 2012 Total returns – Total returns – 3 year % return 5 year % return Alesco Share Price (LHS) S&P/ASX Small Ords Accumulation Index (RHS)5 $16.00 9,000 8,000 19.45 $14.00 -19.46 16.86 7,000 $12.00 6,000 $10.00 -34.25 5,000 $8.00 4,000 $6.00 3,000 $4.00 2,000 Alesco -80.96 Alesco $2.00 1,000 S&P/ASX Small Ordinaries S&P/ASX Small Ordinaries Accumulation Index5 Accumulation Index5 $0.00 0 May 08 May 09 May 10 May 11 May 12 S&P/ASX 200 S&P/ASX 200 -29.00 Accumulation Index Accumulation Index Non-IFRS Information Alesco’s statutory results are reported under International Financial Reporting Standards. Earnings before significant A$m FY12 FY11 items is a non statutory measure reported to provide a greater understanding of the underlying business performance of the Net profit / loss after tax -13.9 13.6 group. Significant items are detailed in Note 4 to the Financial Significant items after tax -25.1 1.2 Statements and relate to amounts of expense that are associated with significant business restructuring, impairment Profit after tax before significant items 11.3 12.4 and DuluxGroup takeover response costs. A reconciliation of Tax expense -5.7 -8.4 earnings from continuing operations before significant items Profit before tax 17.0 20.8 to reported profit is detailed to the right. Financing costs -9.1 -13.4 The summary has not been subject to review or audit. It contains disclosures which are extracted or derived from the EBIT pre significant items 26.1 34.2 Financial Statements for the financial year ended 31 May 2012 EBIT on discontinued operations* -6.2 -6.1 which has been subject to external audit.