The S&P/ASX 300 Index (ASX: XKO) share EBOS Group Ltd (ASX: EBO) had a rough reporting season – it's down 26% in the last month, as the chart below shows.
EBOS is not a widely known name, but it describes itself as the largest and most diversified Australasian marketer, marketer, wholesaler and distributor of healthcare, medical and pharmaceutical products. It's also a leading Australasian animal care brand owner, product marketer and distributor. The TerryWhite Chemmart network may be one of its most recognisable businesses in its stable.
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What happened in the FY25 result?
The ASX 300 share reported a difficult set of numbers for investors who were hoping for growth.
Revenue declined by 7% to $12.3 billion, underlying operating profit (EBITDA) fell 6.3% to $585 million , underlying net profit after tax (NPAT) dropped 15.1% to $258 million and statutory net profit after tax sank 20.8% to $215 million.
There were a few positive growth numbers, after excluding the Chemist Warehouse contract earnings for the period ending 30 June 2024. Total revenue increased 12% and underlying operating profit (EBITDA) grew 7.5%. Plus, the TerryWhite Chemmart network added 34 net new stores, taking its overall number to more than 620 stores.
Outlook for the ASX 300 share
Despite "material adjust to business volumes" as management put it, the company said it's well-positioned for long-term growth, with "continued positive healthcare and animal care industry trends".
It noted near-term macro pressures, including a competitive wholesale pharmacy environment, soft hospital capital spending and subdued consumer sentiment impacting discretionary pet categories.
Taking all of the above into account, the company said it's targeting underlying operating profit (EBITDA) of between $615 million to $635 million, which would be 7% growth at the midpoint of that range. It's expecting positive contributions from both its healthcare and animal segments.
Is the ASX 300 share a buy?
One positive was the dividend. The board decided to maintain the dividend that was declared with the FY25 result at the same level as FY24, increasing the dividend payout ratio to do so. The board said that decision was due to its confidence in the company's growth outlook and overall financial capacity.
It has a grossed-up dividend yield of roughly 5%, including franking credits, which is a solid level of passive income.
In terms of analyst ratings, there are currently 11 recommendations on the business. There's only one sell rating, with five hold ratings and five buy ratings.
So, while investors aren't universally bullish on the business, the average rating is positive, so the ASX 300 share could be a turnaround opportunity after the sell-off.
