HY21: Wagners (ASX:WGN) share price soars, cements plan for growth

The Wagners Holding Company Ltd (ASX:WGN) share price soared 8% yesterday after revealing its HY21 result and plans for growth.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Wagners Holding Company Ltd (ASX: WGN) share price jumped 8% yesterday after reporting its FY21 half-year result.

Wagners is a diversified Australian construction materials and services provider. It produces cement, concrete, aggregates and composite products. It offers a 'Earth friendly concrete' product and it also provides transport services, precast concrete and reinforcing steel.

What did Wagners report in the FY21 half-year result?

The building products business reported that total revenue increased by 26.9% to $155.8 million. Wagners said that revenue increased due to improved transport, quarry, concrete and cement sales.

There was a 15% increase in crossarm sales offset by lower activity in pedestrian infrastructure, mainly due to COVID-19 delays.

Gross profit went up by 30.9% to $88.1 million. Most types of expenses increased for Wagners in line with increased business activity.

The earnings before interest, tax, depreciation and amortisation (EBITDA) of Wagners more than doubled, rising by 116% to $18.6 million. EBIT soared 415% to $10.3 million.

The EBIT margin improved by 4.1 percentage points to 10.6% in the construction materials and services division, whilst new generation building materials saw a 3.7 percentage points increase in the EBIT margin to 8.8%.

There was an improvement of net profit after tax (NPAT) of $6.2 million, leading to a bottom line profit of $6.1 million.

Wagners reported that it generated $32.4 million of pro forma cash flow from operations, up $43.2 million from the prior corresponding period.

Net debt improved by $21.9 million to $61.1 million, which was helped by the improved operational cashflow from better business performance.

Growth plans

It has invested in automation in Australia and increased capacity for its crossarm production facilities to achieve higher productivity and lower cost of production of the new generation building materials. There has been no growth in the USA with the impact of COVID-19, but the pultrusion machine has arrived in USA and it's also pursuing opportunities with manufacturing from Australia.

Wagners boasted that there has been around 20,000 tonnes of CO2 emissions saved by using Wagners low carbon concreate technology Earth friendly concrete (EFC). it said there is increased demand in UK and Europe. The global regulatory focus on CO2 emissions provides a perfect platform for EFC, according to management.

The company said that there was a significant increase of sales of cement in the first half of FY21, with the market outlook looking promising. Wagners is also expecting increased demand in FY21 for concrete with the commencement of infrastructure projects.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

A smiling businessman in the city looks at his phone and punches the air in celebration of good news.
Share Gainers

Why ARB, Cleanaway, Hub24, and RPMGlobal shares are storming higher today

These shares are ending the week with a bang. But why?

Read more »

Five people in an office high five each other.
Technology Shares

5 best performing ASX 200 tech shares of FY25

Some of the technology sector's biggest names led the charge in share price growth last financial year.

Read more »

A young male ASX investor raises his clenched fists in excitement because of rising ASX share prices today
Share Gainers

3 ASX shares that rose 100%+ in FY25

Let's see why these shares delivered huge returns for their shareholders in the last financial year.

Read more »

Silhouettes of nine people climbing a steep mountain to the top at sunset, and helping each other along the way.
Share Gainers

Here are the top 10 ASX 200 shares today

ASX investors had a wild ride this Thursday.

Read more »

Excited couple celebrating success while looking at smartphone.
Share Gainers

Why Domino's, NRW, Pro Medicus, and WIA Gold shares are charging higher today

These shares are avoiding the market weakness and are pushing higher today. But why?

Read more »

Three scientists wearing white coats and blue gloves dance together in a lab.
Healthcare Shares

UP 127% in a year, why is the Pro Medicus share price rocketing higher again today?

ASX investors are sending Pro Medicus shares flying higher on Thursday. But why?

Read more »

Happy man working on his laptop.
Share Gainers

Here are the top 10 ASX 200 shares today

The ASX roared higher this hump day.

Read more »

Delighted adult man, working on a company slogan, on his laptop.
Share Gainers

2 popular ASX 200 shares that returned 30%-plus in FY25

These popular stocks rewarded their owners in FY25.

Read more »