ALS (ASX:ALQ) demonstrates resilience by 139% payout increase

Company News

by Michael Luu

Testing services provider ALS (ASX:ALQ) has upgraded the company’s final payout by 8.5 cents or 139 per cent to 14.6 cents partially franked, despite suffering a 5 per cent revenue hit by pandemic challenges.

The lab examiner managed to limit its underlying profit slump to just 1.5 per cent, as the company recorded underlying earnings of $185.9 million for the coronavirus-battered financial year.

The Brisbane-based certifier managed to raise earnings margins by 72 basis points and increase statutory net profit by selling its environmental testing facility in Shanghai.

The $5.25 billion company operates 370 facilities to deliver testing, inspection, certification and verification services for products in 65 different countries. Its operations span across life sciences, commodities and industrial sectors, which experienced difficulties and interruptions by the COVID-19 pandemic.

The industrial sector sustained the most damage, recording a 17.5 per cent decline in gross income. This was associated with disruptions in construction activities, hampering the demand for testing services.

The company also had several business upsides in parts of the world that managed to subdue pandemic effects. These included a surface-testing operation and wastewater assessment tasks in Singapore, Hong Kong and Australia.

Shares in ALS (ASX:ALQ) are trading 6.9 per cent higher at $11.65.