For the second year in a row Capral Aluminium
(ASX:CAA) has revealed a late upgrade to its earnings outlook for the year to December 31.
In December 2021, the company lifted its earnings guidance with only several weeks to go and yesterday it lifted its 2022 guidance in a similar fashion.
“Market conditions in the second half remained firmer than anticipated resulting in improved earnings,” Capral said in a statement to the ASX
“Further to the guidance provided at the release of our half year results on 18 August 2022, Capral is pleased to announce an upgrade to its FY22 earnings guidance.
“Capral expects underlying EBITDA and underlying EBIT to increase around $5 million, on the midpoint of our previous guidance range, to around $60 million and $40 million respectively.”
In 2021 the company reported EBITDA of $59.2 million so the upgrade should see the company avoiding reporting a weaker operating result. But after-tax profit will be down around 25% from the $42.7 million reported for 2021.
“Net Profit After Tax (excluding Income Tax Benefit) will be around $31 million (in 2022), impacted by a negative LME negative revaluation of $3 million in the second half (FY21: $3m positive revaluation).
“On this basis, Capral would be in a position to continue the payment of a fully franked final dividend,” directors said in an echo of the wording in the 2021 statement.
Capral paid a full franked final dividend of 50 cents a share for 2021 and a total of 70 cents.
Capral paid an interim dividend for 2022 of 20 cents a share after reporting record half year earnings after tax of $22.3 million, including a $3.5 deferred million tax benefit. Underlying EBITDA rose to $31.6 million.
Directors said the interim result saw “Strong volume and improved sales mix and margin combined to lift profitability to record levels. Dwelling commencements have started to decline but a very high order book at the start of the year supported volume. A high level of capacity utilisation in our extrusion plants, combined with benefits of the 2019 operational restructure, contributed to the profit result.”
Investors liked the news of the upgrade and of the final dividend and sent the shares up 4.7% to $7.80.
