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Highlights:
- Incitec Pivot Limited (ASX:IPL) published its interim results ended 31 March 2023.
- In the half-year period, IPL clocked revenue (from ordinary activities), increasing by 19.9 % to AU$3,055.1 million.
- For 1H FY23, IPL’s directors have declared a distribution of 10 cps, which will be paid on 4 July 2023.
The fertiliser and explosives chemicals manufacturer Incitec Pivot Limited (ASX: IPL) shares decreased by 8.463% and was trading at AU$2.920 on Wednesday, 17 May 2023, at 11:39 am AEST, post it released its 1H FY23 results ended 31 March 2023.
Let’s find out the details of the ASX agricultural stock- IPL’S 1H FY23 results.
On Wednesday, Incitec, in its 1H FY23 results, clocked revenue (from ordinary activities) increasing by 19.9 % to AU$3,055.1 million from AU$2,548.3 million in pcp. In the given period, statutory NPAT decreased by 8% to AU$354 million. ROIC (including goodwill) was 12.8%, reflecting a rise of 10.1% from pcp. EBIT was at AU$552 million, decreasing by 3% compared to pcp.
For the 1H FY23 period, directors of the company have declared a 60% franked distribution of 10 cps, which will be paid on 4 July 2023. The distribution amount denotes a payout ratio of 54% of NPAT (excl. individual material items).
During the reported period, the company made substantial development in its strategic goals. It included divesting the Waggaman ammonia facility for US$1.675 billion. Also, an exclusive deal was inked with Perdaman Chemicals and Fertilisers Pty Ltd for 2.3 million tonnes per annum of granular urea.
Further, the company inked a long-term gas supply deal for its ammonium nitrate plant in Queensland-based Moranbah, for gas supply till 2037. IPL’s latest acquisition of Titanobel business integration is generating earnings in accordance with the business case. The company is anticipating a rise in advanced technology sales in focus.
In line with IPL’s capital allocation framework, it intends to take on an on-market share buyback of AU$400 million. They have enough cash reserves and committed bank facilities to conclude the buyback.
On the outlook front, its business unit Dyno Nobel Americas is anticipated to deliver stronger earnings in 2H FY23 on the back of a favourable sales mix and rising consumer base, price resets concluded, progressive gain from March 2023, etc.
Dyno Nobel Asia Pacific’s re-contracting is advancing as planned with gains from FY24. Moranbah is anticipated to deliver nearly 330 kt.
Incitec Pivot Fertilisers’ distribution margins are anticipated to get better from 4Q FY23. Whereas, full-year Phosphate Hill production is anticipated to be between 900 to 930 kt. Also, 100 kt of GI manufactured product (urea-linked) remains on hand.
