S&P/ASX 200 Index (ASX: XJO) stock Reece Ltd (ASX: REH) is taking a tumble today.
Shares in the plumbing parts company closed on Friday trading for $27.10. In early trade on Monday, shares are swapping hands for $25.94 apiece, down 4.3%%.
For some context, the ASX 200 is down 0.2% at this same time.
This underperformance comes following the release of the ASX 200 stock's full-year financial results for the 12-month period ending 30 June (FY 2024).
Read on for the highlights.
ASX 200 stock slides despite FY 2024 profit lift
- Sales revenue of $9.11 billion, up 3% from FY 2023
- Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of $1.01 billion, up 5% year on year
- Adjusted net profit after tax (NPAT) of $416 million, up 3% from FY 2023
- Fully franked final dividend of 17.75 cents per share, up 4% from last year's final dividend
What else happened with Reece in FY 2024?
Investors are bidding down the ASX 200 stock today after the company reported its $9.1 billion in sales revenue, up 2% on a constant currency basis, was impacted by softer housing markets in Australia and New Zealand, along with "mixed demand" across end markets in the United States.
The 5% year on year boost in earnings of $1.01 billion was said to reflect Reece's ongoing focus on cost control to moderate the impact of continuing operating cost inflation, particularly related to rising wages.
Operating cash flow came in at $751 million in FY 2024, down slightly from the $766 million reported last year. Reece attributed the strong cash flow to effective working capital management.
The final dividend of 17.5 cents per share takes the full-year dividend payout to 25.75 cents per share, fully franked.
The board declared a final dividend of 17.75 cents per share fully franked, taking the total dividends for FY 2024 to 25.75 cents per share, up 3% year on year.
What did management say?
Commenting on the results pulling the ASX 200 stock lower today, Reece CEO Peter Wilson said, "Reece delivered a solid result in a challenging environment in FY24, supported by the teams' ongoing disciplined execution."
Wilson added:
As we faced into the softer trading environment, we intentionally set out to refocus the team on the fundamentals of trade distribution, in core skill programs such as selling and trading. These are the foundations of the Reece model underpinning the success of our business.
What's next for Reece shares?
Looking at what could impact the ASX 200 stock in the year ahead, Wilson said:
Whilst we expect FY 2025 to remain challenging, we will continue to focus on the long-term. We invest through the cycle to ensure we are well placed to support customers as the market recovers.
Reece stated that the sector's fundamentals remain positive over the longer term. The company noted that long-term structural factors will support demand for housing and infrastructure in its operating regions.
How has the ASX 200 stock been tracking?
With today's intraday share price falls for Reece factored in, the ASX 200 stock remains up 27% over 12 months.
