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Pandemic cuts $22 million from GWA revenue

Business

Queensland fixtures and fittings company GWA has reported a 12 per cent fall in while normalised net profit after tax to $44.9 million.

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Total revenue increased by 4 per cent to $398.7 million and a final dividend of 3.5 cents a share was declared.

Managing director Tim Salt said it was a very challenging year, with significant uncertainty.

GWA estimated that COVID-19 impacted group revenue by about $22.2 million and group earnings before interest and tax by about $8.6 million in 2020.

“Our top line was significantly impacted by lower construction activity, merchant destocking in the first half, and the impact of the COVID-19 pandemic and lower than expected merchant restocking in the last quarter of the year,” Salt said.

“Our continued focus on operational and cost discipline across the business resulted in a resilient EBIT margin of 18 per cent compared to 18.5 per cent in the prior year.

“While markets were challenging and compounded by the unforeseen impact of COVID-19, our focus continues to be on controlling those elements within our control.

“That included the successful integration of Methven into the group which remains on track with our sales teams fully integrated and synergies achieved ahead of schedule with $3m savings delivered in 2020.

“Our $9 million to $12 million cost-out program also remains on schedule with $5 million savings in 2020, while we also implemented further short-term cost reductions which delivered an additional $10.5 million of savings.

“Meanwhile, we continued to implement our growth strategy. Our relationships with trade partners continue to improve through joint business planning and core range extensions for Caroma, Clark and Methven brands and enable us to respond to changing consumer buying dynamics.”

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