ASX 200 stock Incitec Pivot Ltd (ASX: IPL) is in the green on Monday after the company posted its FY24 results.
Shares in the fertiliser company are swapping hands at $3.17 apiece, nearly 2% higher on the day as investors digest the numbers.
Zooming out, the stock is up 11% this year to date, after a nearly 7% jump this past month.
Here's what the ASX 200 stock posted in its annual figures.
ASX 200 stock climbs on FY24 results
Incitec Pivot reported mixed results for the year, largely due to major restructuring expenses. Here are the highlights:
- Reported a net loss of $311 million, primarily due to a $712 million non-cash impairment in the fertilisers business
- Pre-tax earnings, excluding one-off items, was $580 million, down from $880 million last year
- A final unfranked dividend of 6.3 cents per share, reflecting a 50% payout ratio. Full payout of 10.6 cents per share, down from 15 cents last year
- Completion of a $500 million capital return and an ongoing $900 million on-market share buyback
What else happened in FY24?
The ASX 200 stock had a good year on the chart but a mixed year in the business.
Incitec Pivot's "transformation activities" dominated the year, with a focus on reshaping its business portfolio.
The sale of its ammonia manufacturing plant in Louisiana and the closure of its Gibson Island facility led to a re-basing of operations.
Due to the mixed performance, the board approved a 6.3 cents per share final dividend, reducing the company's annual dividend to 10.6 cents per share from 15 cents per share last year.
Meanwhile, customer demand boosted sales in its Dyno Nobel business in the Asia Pacific (APAC) region. It posted record pre-tax earnings of $257 million, up from $188 million the prior year.
Management put this down to the "steady uptake" of the technology in the region.
Meanwhile, the APAC fertilisers business saw pre-tax earnings decrease to $120 million from $153 million last year.
This was put down to "reduced manufacturing performance at Phosphate Hill."
The company also achieved major environmental milestones, including installing the Moranbah N2O Tertiary Abatement Project, which aims to reduce greenhouse gas emissions.
What did management say?
CEO and Managing Director Mauro Neves expressed optimism about IPL's performance amid a year of transformation:
Despite a challenging first half, our efforts to enhance operational efficiency and reliability have delivered significant improvements at Phosphate Hill, with the site finishing the year strongly. Pleasingly, our Distribution business delivered its strongest result on record with an EBIT of $60m, positioning this business well for the future alongside a strong agricultural industry.
We remain committed to delivering the Fertilisers separation in the next six to twelve months, with a potential divestment in parts to maximise value and increase execution certainty. We have confirmed the closure of the Gibson Island primary distribution centre and will be transitioning to a third-party facility operated by Qube at the Port of Brisbane. This will significantly modernise IPF's Brisbane PDC capability, enabling us to meet our customers' expectations well into the future.
What's next?
Looking ahead, Incitec Pivot is focused on further growth in FY25, with plans to divest parts of its fertilisers business.
Management says this is set to have a positive impact on earnings this year.
This will be The outlook for FY25 is expected to be strong, supported by transformation activities focusing on areas such as price discipline and cost management, recontracting benefits and improved margins from technology. Turnarounds in FY25 are expected to have an earnings impact of $45m to $55m for the year.
ASX 200 stock snapshot
This ASX 200 stock has shown resilience over the past year, bolstered by the company's strategic moves and commitment to shareholder returns.
