The Emeco Holdings Limited (ASX: EHL) share price has slumped in lunchtime trading on Wednesday.
Shares in the mining equipment company have U-turned after earlier bolting more than 5% higher after Emeco released its full-year results for FY21.
Let's take a look at how Emeco performed for the full year.
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Emeco declares first dividend in 8 years
Emeco's full-year report was highlighted by an operating EBITDA of $237.7 million.
Despite being 7% lower than operating EBITDA in FY20, Emeco highlighted the various challenges the company faced in FY21.
The company noted disruptions arising from the COVID-19 pandemic, high levels of uncertainty in global markets and declining coal prices as some of the challenges.
In addition, Emeco highlighted a return on capital of 17%, demonstrating the company's resilient business model.
For FY21, the company's revenue rose 14.8% to $620.5 million although net profit tanked 68.7% to $20.7 million.
Emeco also noted the contribution of Pit N Portal which the company acquired in February 2020.
The company also stressed its strengthened balance sheet after reducing its interest and hedging costs by 64% in June.
Despite profit tumbling, Emeco declared a fully franked dividend of 1.25 cents per share for the first time in 8 years.
The company also launched a $3.8 million on-market share buyback.
Outlook for Emeco
Emeco noted that the company is expecting a strong improvement in performance for FY22.
The company highlighted a renewed focus on redeploying idle rental equipment and improving the growth trajectory in its services-based operations.
Emeco reported its rental business is supported by strong momentum in earnings from the fourth quarter of FY21.
The company's strategic focus for FY22 will rely on winning long-term projects to continue commodity diversification and increase services revenue.
As a result, FY22 net capital expenditure is expected to be in the $140 million to $150 million range.
Emeco also noted continued strong free cash flow and delivering on management's policy of returning 25-40% of operating NPAT to shareholders.
Snapshot of the Emeco share price
Despite a dour start to the year, the Emeco share price is trading more than 13% higher since the start of 2021.
At the time of writing, shares in the mining equipment company are down 1.16% for the day to $1.275.
The Emeco share price has been trading in a wide range today as investors digest the company's results.
Shares in Emeco were more than 5% higher earlier after hitting an intraday high of $1.36.
