Scott Technology Reports Positive Momentum In Half Year Results

Automation and robotics solutions provider, Scott Technology Limited (NZX: SCT), has today released its unaudited interim results for the six months to 28 February 2021 (H1 F21).

In summary:

• Positive momentum as the Scott 2025 strategy takes hold, delivering a streamlined cost structure, a focus on core areas of proven expertise and improved performance
• Year on year increases in revenue and EBITDA and strong gross margin improvement
• Revenue up 5% to $104.5m, gross margin up 28% to 23%, EBITDA of $11.2m and net profit after tax of $4.7m
• Strong programme of forward work with new system design and build contracts in Europe, USA, China and Australasia and continuing growth in product and service businesses
• Dividend declared of 2.0 cents per share

The results reflect the positive momentum being gained as the Scott 2025 strategy takes hold and as most regions commence the recovery from COVID-19. This has seen forward work programs in Europe, USA, China and Australasia grow firmly from this time a year ago as new system design and build contracts have been awarded at a steady and focused pace over recent months.

The product and service businesses of Scott are continuing to show strong recovery and positive margin performances. The mining products and parts business - Rocklabs - together with the BladeStop product revenues into the meat industry are showing strong growth on prior year. Service revenues across several key markets are also growing as the team places increasing importance on executing up-front service level agreements with key customers.

These revenue streams are all supported by the streamlined operating cost structure now in place following last year’s restructuring activity across all regions and Group head office. This is seeing an increase in margins.

The focus on employee health and safety across the Group is reflected in a large increase in reported near-misses – seen as a forward-looking indicator as avoids potential future risk – while the ‘lag’ indicators of lost time injuries fell to zero at the half year. This is great progress and a result of the deep and sincere commitment from employees across the Scott Group.

CEO of Scott Technology John Kippenberger, said: “Despite the ongoing disruptions of the global pandemic and the pressures this continues to place on our international operations and travel, the team at Scott has demonstrated strong progress with our new focused strategy, including positive strides forward on team safety and earnings performance.

Our priority remains to deliver in our proven areas of expertise in systems technology, products and service. As the world begins to slowly open up as vaccines are rolled out, we are confident of building on the early positive momentum seen in H1 F21”.

The full announcement and presentation are attached and can also be viewed online here https://www.nzx.com/announcements/370356

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