The Orica Ltd (ASX: ORI) share price is in focus after the company reported record first-half EBIT of $512 million, up 5% year-on-year, and an 8% rise in underlying net profit after tax to $283.1 million.
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What did Orica report?
- Sales revenue of $3,884.2 million, down 1% from the prior half
- EBIT of $512.0 million, up 5%
- Net Profit After Tax (pre-significant items) of $283.1 million, up 8%
- Earnings per share (pre-significant items) of 60.7 cents, up 12%
- Unfranked interim dividend of 28.5 cents per share, up 14%
- Return on Net Assets at 14.7%, the highest in 13 years
- $500 million on-market share buy-back completed
What else do investors need to know?
Orica continued to deliver strong underlying earnings, with solid demand for premium products, technology offerings and stable gold and copper market conditions. The company finalised its $500 million share buy-back and resumed the Dividend Reinvestment Plan, highlighting a focus on capital management.
Strategic moves included agreements to acquire Nelson Brothers' explosives business in North America and the Danafloat™ range, expanding Orica's reach into copper processing. The company also successfully managed disruptions in ammonium nitrate supply and settled major US litigation.
Orica reported no significant environmental incidents and achieved its 2026 near-term emissions reduction target, reaffirming its commitment to sustainability.
What did Orica management say?
Managing Director and CEO Sanjeev Gandhi said:
We have delivered record earnings in the first half, driven by strong demand for premium products and advanced technology offerings, robust gold and copper markets and disciplined commercial execution. Despite a challenging environment, our first half EBIT was the highest in over 20 years and highlights the continued commitment of our people and the resilience and adaptability of Orica's diversified portfolio, manufacturing asset base and global supply network in a market that continues to value quality, security of supply and technology-enabled outcomes.
What's next for Orica?
The company expects full-year underlying EBIT growth across all business segments and regions, provided there are no major new external disruptions. Orica plans to continue investing in supply chain security, growing premium product adoption, and expanding its digital offerings.
Management also reiterated its focus on cost reduction, targeting at least $100 million in enduring savings, with most benefits expected from 2027. The balance sheet remains strong, with leverage at the lower end of targets, supporting further growth initiatives and aiming for sustainable long-term returns to shareholders.
Orica share price snapshot
Over the past 12 months, Orica shares have risen 25%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 8% over the same period.
