PWR Holdings Ltd (ASX: PWH) shares have experienced a significant decline on Friday morning, dropping 12% to $10.31. This downturn follows the company's release of its full-year results after the market closed on Thursday.
Record Performance Highlights
PWR Holdings achieved notable financial milestones for the 12 months ending June 30. The company reported:
- Revenue increased by 17.8% to a record $139.4 million. This growth was driven by a 14.7% rise in Australia, a 10.6% increase in the United States, and an 8.9% boost in the United Kingdom.
- EBITDA grew by 15.7% to $45.2 million.
- Net profit after tax rose by 14% to $24.8 million.
- Earnings per share were up by 13.9% to 24.7 cents.
- Final dividend increased by 3.4% to 9.2 cents per share, bringing the total dividend for the year to 14 cents per share, a 12% rise year on year.
Performance Overview
The standout performer for PWR Holdings was its Emerging Technologies division, which saw a remarkable 57.8% revenue growth, now contributing 25.1% of total group revenue, up from 18.7% the previous year. This segment's growth was primarily fueled by a substantial 100% increase in revenue from the aerospace and defence markets, reaching $21 million.
Despite these impressive figures, PWR Holdings faced some challenges. Margins were slightly affected due to investments, including a notable increase in headcount by 67 employees during the year. This expansion was partly aimed at preparing the company for future growth opportunities, particularly in aerospace and defence sectors.
Comparison to Expectations
The company's reported results fell short of some forecasts. Expectations had set the net profit after tax at around $26.8 million, meaning PWR Holdings did not meet this target. Additionally, anticipated margin expansion for FY 2025 may be impacted by ongoing investments.
Management’s Perspective
Kees Weel, PWR Holdings' founding shareholder and managing director, expressed satisfaction with the company's record performance but acknowledged that short-term margin pressures are expected. He commented:
"The full-year result reflects solid performance across all parts of the business, which continue to grow and execute well. FY 2025 will be a transition year for PWR as we move to our new headquarters in Stapylton. Margins will be impacted in the near term as we invest ahead of the curve to position ourselves for future growth."
No specific guidance has been provided for FY 2025 at this time.
Despite the current drop in share price, PWR Holdings’ stock has risen by 18% over the past year. This suggests that while short-term challenges may be influencing investor sentiment, the company's long-term growth potential remains robust.