Highlights
Finance Report
Non-recurring items
The reported net profit after tax of
$15.3 million for continuing operations
includes the following non-recurring
items, leading to a net charge against
profit of $1.1 million (post tax):
$ million
Take-over advice and
compliance costs
Costs associated with recent
(0.1)
take-over activities.
Australian
restructuring costs (1.5)
Costs associated with aligning the
Australian organisation
Total ‘non-recurring items’ (1.6)
Tax benefits relating to
non-recurring items 0.5
Total ‘non-recurring items’
post tax (1.1)
Cash flow
Net cash flow from operating activities
of $33.4 million ($3.1 million in
FY2006) was driven by the significant
improvement in operating
performance as well as benefiting
from working capital management.
The net cash outflow from financing
activities of $19.8 million ($0.7 million
in FY2006) includes the payment of
the fully franked 40 cent special
dividend of $32.8 million in
September 2006.
Working Capital (A$m)
Capital Expenditure
Net Debt (A$m)
Working Capital
Depreciation and
Interest cover (times)
as a % sales
Amortisation
Working Capital
Capital Expenditure
A$m
Capital expenditure
Wattyl maintains its prudent
approach to capital expenditure
with projects focusing primarily on
sustaining operations totalling
$7.3 million in FY2007 compared
to $8.0 million in FY2006.
Financial position
Wattyl’s financial position remains
strong, with net debt of $48.0 million
at 30 June 2007, compared to
$26.7 million at 30 June 2006.
This represents a gearing ratio (net
debt: equity & net debt) of 26.9%
compared to 14.4% at June 2006.
Bank loans and facilities were
renegotiated in August 2006 and
have been increased to $100 million
for a three year term expiring on
30 September 2009.
Wattyl operates well within all relevant
bank and debt covenants, with
interest cover (EBIT before nonrecurring
items to total interest paid)
at 5.4 times (2006: 6.5 times).
Interest Cover
Financial Risk
Management
Exposure to currency, credit,
liquidity and interest rate risks
arises in the normal course of
Wattyl’s business. Corporate
Finance is responsible for financial risk
management under policies approved
by the Board. The overall financial risk
management program seeks to
minimise potential adverse effects,
reduce volatility of earnings and
ensure a base level of profitability.
Further details are provided in note 39
of the financial statements.
Urs Meyerhans,
Finance Director
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