23 December 2024 FY 2024 results summary for Tristel (TSTL)<\/strong>:<\/p>\n <\/p>\n Further reading: <\/strong>My TSTL Buy report<\/a> | <\/strong>All my TSTL posts<\/a> |<\/strong> TSTL website<\/a> <\/p>\n [RNS July 2024] \u201cThe Board and I remain committed to our financial plan for the three years to 30 June 2025, which was a continuation of the plan for the prior three-year period ending in June 2022. The three key financial targets of both the old and new plans are:<\/em> \u201cHigher sales volume accounted for \u00a32.2m<\/em><\/strong> of the \u00a35.9m revenue growth and <\/em>price increases accounted for the remaining \u00a33.7m<\/em><\/strong>. This represents an <\/em>average price increase of 11%<\/em><\/strong>, driven primarily by the UK where the increase has been higher because of supply agreements which require fixed pricing extending into future years<\/em>.\u201d\u00a0<\/p>\n \u201c<\/em>The northern hemisphere makes up 75% of our sales, where winter buying in preparation for high levels of infection gives a real boost to the October, November, December numbers<\/em><\/strong>, when as a consequence we see a strong half-one because of winter buying.\u201d<\/em><\/p>\n \u201cWe think the most likely price increase that we will instigate is inflation and <\/em>we\u2019re settling down to 3-4% inflation and that will most likely be the increase that we implement <\/em><\/strong>from at different points in time in different countries. But in January, in March next year, we will be implementing that level of increase.<\/em>\u201c<\/p>\n \u201cHaving joined the business just a few weeks ago, <\/em>I ask for a little time to work closely with stakeholders to review the company\u2019s strategic direction<\/em><\/strong>. This process will ensure that we are well-positioned for the next phase of our growth journey. I look forward to updating investors on our financial targets beyond June 2025, as we define our goals to align with the growing opportunities in our core markets and new areas of expansion.\u201d<\/em><\/p>\n \u201cGoing forward the Board\u2019s intention is to <\/em>increase the dividend annually, in line with the year\u2019s increase in EPS, committing to minimum dividend growth of 5%.<\/em><\/strong>\u201c<\/p>\n [FY 2022] [FY 2023] Restatement 2<\/em><\/strong> Restatement 3<\/em><\/strong> \u201c<\/em>IAS 2: Cost of sales restatement\u00a0<\/em><\/strong> \u201cLooking at the gross margin as a whole\u2026 we have moved some of our overheads up to cost of goods this year. <\/em>There are some production associated costs that now have become materia<\/em><\/strong>
By Maynard Paton<\/strong><\/p>\n\n
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Contents<\/strong><\/h2>\n
News links, share data and disclosure<\/strong><\/h2>\n
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Why I own TSTL<\/strong><\/h2>\n
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Results summary<\/strong><\/h2>\n
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<\/figure>\nRevenue, profit and dividend<\/strong><\/h2>\n
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\u201c\u2022 <\/em>Revenues for the year were up 16.4% to \u00a341.9m <\/em><\/strong>(FY 2023: \u00a336.0m), <\/em>ahead of market expectations<\/em><\/strong> and above the Company\u2019s performance target for revenue growth (an annual average of 10-15% over three years).<\/em>
\u2022 <\/em>Adjusted profit before tax* will be no less than \u00a38.0m, ahead of market expectations<\/em><\/strong> and 29% ahead of last year (FY 2023: \u00a36.2m).<\/em>
\u2022 Tristel continues to be debt free and cash generative. <\/em>Cash balances on 30 June 2024 were \u00a311.6m<\/em><\/strong> (30 June 2023: \u00a39.5m)<\/em>.\u201d<\/p>\n\n
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\u00a0<\/em>
i. sales growth in the range of 10% to 15% per annum as an annual average over the three years<\/em><\/strong>
ii. <\/em><\/strong>the achievement in each year of an EBITDA margin (excluding share-based payment charge) of at least 25%, and
<\/em>iii. <\/em><\/strong>to increase profit before tax (excluding share-based payments) year-on-year, independently of the other two targets<\/em>.\u201d\u00a0<\/p>\n\n
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Prior-year restatements<\/strong><\/h2>\n
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\u201cDuring the current year, it was identified that deferred tax assets relating to <\/em>unrecognised taxable losses of \u00a33,600,000 in the UK had not been recognised in the prior year<\/em><\/strong>. Based on the circumstances in the prior year, these should have been recorded as a deferred tax asset at 19%, equating to \u00a3684,000. The prior year financial statements have been restated for this adjustment.<\/em> In addition, in the prior year an income tax receivable for \u00a3170,000 was inappropriately classified as an income tax liability<\/em><\/strong>. The prior year comparatives have been restated to correctly reclassify the balance as an income tax receivable.<\/em>\u201d\u00a0<\/p>\n\n
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\u201cRestatement 1<\/em><\/strong>
During the current financial year the Group adopted a suite of lease accounting software. The software has outlined the need for a restatement of the financial position of prior years which is detailed below. These differences emerged from varying discount rate applications and omitted leases, which in current year have been supplied by an independent third party due to the lack of borrowing within the Group and rectified respectively\u2026<\/em><\/p>\n
During the current financial year it was identified that a corporate tax receivable balance had incorrectly been recorded as a sales tax payable in the prior year\u2026<\/em><\/p>\n
During the current financial year it was identified that no adjustment had previously been made for the tax effect of unrealised intra-group profits\u2026<\/em>\u201c<\/p>\n\n
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Within the prior-year income statement <\/em>elements of the cost of production were erroneously included within administrative expenses<\/em><\/strong>, excluding share-based payments, depreciation, amortisation and impairment and depreciation, amortisation and impairments. <\/em>\u00a31,257,000 has been reclassified to cost of sales, \u00a3430,000 from depreciation, amortisation and impairments and \u00a3827,000 from administrative expenses<\/em><\/strong>, excluding share-based payments, depreciation, amortisation and impairment to align to the requirements of IAS 2. <\/em>This has no overall effect on the total profit for the prior financial year.<\/em><\/strong> The adjustment does not impact the amounts previously presented on the balance sheet at 30 June 2022 and therefore a third balance sheet is not considered to provide a user of the financial statements with any additional information.<\/em>\u201d\u00a0<\/p>\n\n
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