This $10 billion ASX industrial stock jumped 6% to $22.19 on Thursday after Orica Ltd (ASX: ORI) delivered a strong first-half result.
The rally continues a solid recovery for the ASX industrial stock following its March dip. Orica shares are now up around 8% over the past month and roughly 32% over 12 months, comfortably outperforming the S&P/ASX 200 Index (ASX: XJO), which has gained about 8% over the same period.
So, what sparked today's sharp move higher?
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Scale and global footprint deliver
The ASX industrial stock is one of the world's largest providers of commercial explosives and blasting systems used in mining and infrastructure projects. Orica also has growing exposure to mining technology, digital solutions, and chemical services.
Its strength lies in scale, long-term customer relationships, and its global manufacturing and supply network. And today's results showed those advantages are still delivering.
The company posted record first-half EBIT of $512 million, up 5% year on year. Underlying net profit after tax rose 8% to $283.1 million, while earnings per share increased 12% to 60.7 cents.
Revenue slipped 1% to $3.88 billion, but investors appeared far more focused on profit growth and margin strength.
Record earnings
Demand remained strong for Orica's premium blasting products and advanced technology offerings. Supportive gold and copper market conditions also helped drive earnings higher.
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.
Share buyback, explosives takeover
Investors in the ASX industrial stock also welcomed signs of disciplined capital management. Orica completed its $500 million share buyback during the period and resumed its Dividend Reinvestment Plan. That reinforces confidence in the balance sheet and cash generation.
The company was also active strategically. Management announced agreements to acquire Nelson Brothers' explosives business in North America, as well as the Danafloat™ range, expanding Orica's footprint in copper processing and mining chemicals.
At the same time, the business successfully navigated disruptions in ammonium nitrate supply and resolved major litigation issues in the United States.
What next for Orica?
Looking ahead, management expects full-year underlying EBIT growth across all business segments and regions, assuming no major external disruptions emerge.
The ASX industrial stock also plans to continue investing in supply chain security, premium product adoption, and digital technology offerings.
Cost reduction remains another major focus. Management is targeting at least $100 million in long-term savings, with most of the benefits expected to flow through from 2027 onwards.
Importantly, the balance sheet remains strong, with leverage sitting at the lower end of management's target range. That gives Orica flexibility to continue investing in growth while supporting shareholder returns.
