Wagners Holding Company Limited (ASX: WGN) has been on its expansion path since inception and has now included cement, fly ash and lime, reinforcing steel, contract crushing, bulk transport and lightweight composite fibre products in its portfolio. WGN has recently organized its annual general meeting on November 1, 2018 i.e. today. Brief view on FY18 financial growth along with the plans laid for FY19 were the core part of the meeting. FY18 results for the company were well in sync with the estimated one and has laid a strong growth platform for the years ahead.
20% growth on proforma basis in both revenues and EBITDA was reported for FY18, and 50.7% growth in net profit after tax was posted by the company. Construction materials and service business posted 21% growth in revenues in comparison to the prior year and new generation building materials business posted 26% growth in revenues in comparison to the previous year.
Company had several projects that neared to its completion in the first half of 2018, and the impact of the same was well reflected on the first half result of FY18. For FY19, company has no major projects in line for commencement. Significant investments related to capability upgrades for concrete and quarry assets as well for offshore expansion for the new generation building material business were made during the year.
In its projected estimated for FY19 growth, company expects slight slowdown during the first half of the year in correspondence to FY18. However, company expects a healthy growth coming from the second half with the commencement of the projects work. Upturn in the mining sector has significantly benefitted the transport business of the company and company holds a strong positive outlook for the years ahead in this domain. The infrastructure program in Queensland faced some issues and has not turned well so far as per the expectation by the company, however the growing demand of infrastructure will boost the demand for the cement in near term. Company is a low-cost producer of cement with proper control over the manufacturing process expected to work stable during the challenging period to be faced by the sector in FY20. Company’s long term plan to roll out a concrete plant network throughout South east Queensland is now progressing slowly and this well definitely support the cement volumes in the future and the impact will be seen on the company growth in future.
FY18 has been a period of foundation building for the company to grow in the heavy construction materials and services space as well as in composites and EFC. Management is highly positive for FY19 outlook which is again dependent on the large contracts timings and roll out of the infrastructure spending across Australia.
With the progress of the infrastructure program carried at Queensland and growing demand from mining sector and infrastructure space, company expects to continue with its growth plan. The stock of the company is trading at lower levels of $ 3.88, down 8.3% on November 01, 2018 (3:30 PM AEST).
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