Steel & Tube Holdings Limited has reported its unaudited results for the six months to 31 December 2023, with normalised EBIT of $11.3 million, which is above the top end of guidance; a further reduction in inventory; and a positive cash position with no bank debt. Chief Executive, Mark Malpass, said the result demonstrates Steel & Tube’s resilience and agility through the economic cycle. “We have continued our focus on ‘controlling the controllables’ while providing high levels of customer service. The $5 million cost out program is progressing well and offsetting inflationary pressures with costs below prior year. Pleasingly, we have seen market share growth in key categories, and we continue to generate strong margins with gross margin $/tonne increasing above prior year. Strategic investments into high value products and services and acquisitions continue to perform strongly.

“With a strong balance sheet and proven dual pathway strategy, Steel & Tube is well positioned to take advantage of increasing activity and demand when the economy recovers. Steel & Tube has significant experience and expertise in many areas identified as priorities by the new Government including transport infrastructure, renewable energy, water and climate resilience. We will continue to focus on both organic and acquisition growth with multiple opportunities currently being assessed.”

Mr Malpass noted subdued volumes were seen across all sectors with economic headwinds continuing the trends seen in 2H23. Volumes were down 5.1% on 2H23, with revenue down a corresponding 4.4% to $261.8 million. Gross margin $/tonne continued to improve as a result of pricing disciplines and cost control, increasing to $926 per tonne compared to $850/tonne in the pcp. Normalised EBIT of $11.3m was an improvement on 2H23 and at the top end of guidance.

Economic conditions are expected to remain challenging in the short term with some easing of macro trends supporting increased activity from Q4 FY24. Steel & Tube is well positioned to leverage the increase in demand from both the private and public sectors. Growth remains a key focus, both through organic expansion and acquisition.