Skellerup HY20 Result

Skellerup Holdings Limited
Distribution Notice

Updated as at 18 December 2019



Please note: all cash amounts in this form should be provided to 8 decimal places

Section 1: Issuer information
Name of issuer Skellerup Holdings Limited
Financial product name/description Ordinary Shares
NZX ticker code SKL
ISIN (If unknown, check on NZX
website)
NZSKXE0001S8
Type of distribution
(Please mark with an X in the
relevant box/es)
Full Year Quarterly
Half Year X Special
DRP applies
Record date Close of trading on 06/03/2020
Ex-Date (one business day before the
Record Date)
05/03/2020
Payment date (and allotment date for
DRP)
19/03/2020
Total monies associated with the
distribution
1

$10,711,434
Source of distribution (for example,
retained earnings)
Retained Earnings
Currency NZD
Section 2: Distribution amounts per financial product
Gross distribution
2
$0.06569444
Gross taxable amount
3
$0.06569444
Total cash distribution
4
$0.05500000
Excluded amount (applicable to listed
PIEs)
N/A
Supplementary distribution amount $0.00485294
Section 3: Imputation credits and Resident Withholding Tax
5

Is the distribution imputed Fully imputed
Partial imputation X
No imputation

1
Continuous issuers should indicate that this is based on the number of units on issue at the date of the form
2
“Gross distribution” is the total cash distribution plus the amount of imputation credits, per financial product, before the deduction of
Resident Withholding Tax (RWT).
3
“Gross taxable amount” is the gross distribution minus any excluded income.
4
“Total cash distribution” is the cash distribution excluding imputation credits, per financial product, before the deduction of RWT.
This should include any excluded amounts, where applicable to listed PIEs.
5
The imputation credits plus the RWT amount is 33% of the gross taxable amount for the purposes of this form. If the distribution is
fully imputed the imputation credits will be 28% of the gross taxable amount with remaining 5% being RWT. This does not constitute
advice as to whether or not RWT needs to be withheld.

If fully or partially imputed, please
state imputation rate as % applied
6

14%
Imputation tax credits per financial
product
$0.01069444
Resident Withholding Tax per
financial product
$0.01098472
Section 4: Distribution re-investment plan (if applicable)
DRP % discount (if any)
N/A
Start date and end date for
determining market price for DRP

Date strike price to be announced (if
not available at this time)

Specify source of financial products to
be issued under DRP programme
(new issue or to be bought on market)

DRP strike price per financial product
$
Last date to submit a participation
notice for this distribution in
accordance with DRP participation
terms

Section 5: Authority for this announcement
Name of person

authorised to make
this announcement
Graham Leaming
Contact person for this
announcement
Graham Leaming
Contact phone number 021 271 9206
Contact email address Graham.leaming@skellerupgroup.com
Date of release through MAP

13/02/2020





6
Calculated as (imputation credits/gross taxable amount) x 100. Fully imputed dividends will be 28% as a % rate applied.

---

Skellerup Holdings Limited
Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)
Updated as at 17 October 2019


Results for announcement to the market
Name of issuer Skellerup Holdings Limited
Reporting Period 6 months to 31 December 2019
Previous Reporting Period 6 months to 31 December 2018
Currency NZD
Amount (000s) Percentage change
Revenue from continuing
operations
$122,976 2%
Total Revenue $122,976 2%
Net profit/(loss) from
continuing operations
$12,073 (10%)
Total net profit/(loss) $12,073 (10%)
Interim/Final Dividend
Amount per Quoted Equity
Security
$ 0.0550000
Imputed amount per Quoted
Equity Security
$0.01069444
Record Date 06/03/2020
Dividend Payment Date 19/03/2020
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$0.6137 $0.6493
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood

Authority for this announcement
Name of person

authorised
to make this announcement
Graham Leaming
Contact person for this
announcement
Graham Leaming
Contact phone number 021 271 9206
Contact email address graham.leaming@skellerupgroup.com
Date of release through MAP

13/02/2020

Unaudited financial statements accompany this announcement.

---

13 February 2020
Skellerup expects FY20 earnings to be consistent with FY19
Skellerup announced today a half year unaudited net profit after tax of $12.1 million for the six
months ending 31 December 2019.
Key points for the six months ending 31 December 2019
• Revenue of $122.9 million, up 2% on prior comparative period (pcp)
• Earnings before interest and tax (EBIT) of $18.0 million, down 7% on pcp
o Agri Division EBIT of $10.1 million, up 5% on pcp
o Industrial Division EBIT of $9.9 million, down 15% on pcp
o Corporate Costs of $2.0 million, up 7% on pcp
• Net profit after tax (NPAT) of $12.1 million, down 10% on pcp
• Record operating cash flow of $24.1 million, up 84% on pcp
• Interim dividend in line with pcp at 5.5cps
• Strong start to second half of FY20 raising year-to-date NPAT ahead of pcp.
• FY20 NPAT forecast in line with pcp.

A record result from the Agri Division partially offset a weaker Industrial Division with the latter
impacted by trade tariffs and lower demand from the infrastructural and exploration sectors in the
USA.
Agri Division EBIT increased by 5 percent to $10.1 million. CEO David Mair said international market
revenue growth and operational gains drove the improvement. “The US market has delivered
revenue growth as farmers have benefited from improved returns. Operationally, our key Wigram
facility has made further productivity gains. We have more to achieve to reduce waste and improve
performance.” Mair also noted that the recently acquired Silclear business will provide a boost to
earnings in the second half of FY20.
Industrial Division EBIT reduced by 15 percent to $9.9 million. Mair said a weaker contribution from
its large USA market and European Automotive sector caused the reduction from the record result
achieved in the pcp. “USA trade tariffs and a lower level of oil and gas exploration activity reduced
earnings. We have also seen a slowdown in infrastructural markets and have been impacted by later
than anticipated commencement on some exciting new projects in the USA.” Mair also said it was
pleasing that earnings increased due to growth from new products sold into roofing and marine
foam applications and the addition of the Nexus business acquired in April 2019.
Chair Liz Coutts said Skellerup continued to generate very strong cash flows and that the interim
dividend would be 5.5 cents per share, imputed 50% the same as in the pcp.

“We have confidence in our strategy of working closely with key customers to develop products that
deliver value and sustainable earnings growth. We have a strong balance sheet and generate very
good cash flows. We have not seen any immediate material impact of the new coronavirus on our
business, but we expect a temporary impact on our supply chain. We are carefully monitoring and
taking actions to ensure we are best placed to respond to challenges this may present.
We have made a strong start to the second half of the year, raising year-to-date NPAT ahead of pcp.
We expect full year FY20 NPAT to be consistent with the result achieved in the pcp.”

For further information please contact:
David Mair Graham Leaming
Chief Executive Officer Chief Financial Officer
021 708 021 021 271 9206

---

1
HY20 Results
13 February 2020
David Mair CEO & Executive Director
Graham Leaming CFO

2
FY19 Results23 August 2019
Record EBIT for the Agri Division
•Higher sales into US market and operational improvements
Industrial Division EBIT down on record HY19 result
•Lower sales into US oil and gas and water infrastructure and impact of trade tariffs
NPAT down on record HY19 result
•Lower EBIT plus impact of IFRS-16 increasing interest expense
Interim dividend pay-out of 5.5 cents per share
•Same as HY19. Imputed 50%.
Silclear acquisition in November 2019
•Performing well and expected to make good contribution in second half of year.
FY20 NPAT expected to be consistent with pcp
•Strong start to second half of FY20, YTD NPAT ahead of pcp.
Skellerup Key Points HY20
0
2
4
6
8
10
12
14
16
Hy16HY17HY18HY19HY20
NPAT (million)
Net Profit after Tax
0
10
20
30
HY16HY17HY18HY19HY20
EBIT (millions)
EBIT by Segment
*
AgriIndustrial
* Excludes Corporate Segment Costs

3
FY19 Results23 August 2019
Skellerup Financial Highlights HY20
NZ$ MillionHY17HY18HY19HY20
Revenue97.3116.7120.2123.0
EBITDA16.921.323.024.1
Depreciation & amortisation3.63.83.66.1
EBIT13.317.519.418.0
Finance costs0.60.90.91.3
Tax expense3.84.95.24.6
NPAT8.911.713.412.1
Earnings cents per share4.66.16.96.2
Dividend cents per share3.54.05.55.5
Operating cash flow9.714.813.024.1
Net debt35.634.832.434.7
Capital &intangible expenditure6.93.11.92.6
Acquisition & Investment---5.0
•Revenue up 2% on pcp(currency
impact negligible).
•EBIT down 7% on pcpdue to lower
sales into US and US tariffs.
•Adoption of IFRS-16 impact:
▪Depreciation charge of $2.4
million
▪Interest charge of $0.5 million
•NPAT down 10% on pcpdue to
lower EBIT and IFRS-16.
•Dividend same as pcp.
•Operating cashflow up 84% on pcp
due to working capital
improvements.
•Robust balance sheet –net debt
up on HY19 (but down on FY19).
•Acquisition of Silclear
($5.0 million excluding inventory)

4
FY19 Results23 August 2019
Skellerup HY20 Agri Division
Revenue and EBIT up 5% over pcp
•International dairy market strong
▪US market up
▪NZ market fractionally down
▪Operational process and efficiency improvements continue
▪Silclear strengthens offering and opportunity for growth
•Footwear solid
▪US market growth
▪NZ market in line
▪Operational performance good
NZ$ MillionHY17HY18HY19HY20
Revenue36.643.142.344.2
EBIT8.49.59.610.1
EBIT %23.022.122.822.9
Silclear Acquisition
•Strategic move to bring silicone tubing capability into the
Group
•Performing well
•Good growth prospects with existing OEM customers

5

6
FY19 Results23 August 2019
Skellerup HY20 Industrial Division
NZ$ MillionHY17HY18HY19HY20
Revenue60.873.778.078.8
EBIT7.210.011.79.9
EBIT %11.813.615.012.6
HY20 Update
•Water and flow control applications
▪US market down
▪Winning new business in US and Australia
•Vacuum systems in oil & gas applications
▪US market down and tariffs impacting on margin
▪Innovation and customer focus winning market share
•Improved returns from roofing applications
▪Innovation and customer focus winning business at
improved margin
•High performance foam applications growth continues
▪Ultralon U-Dekand Nexus
Nexus Acquisition
•Performing in line with expectations
•Pursuing rationalisation with Ultralon
Sim Lim Acquisition
•Strategic move to bring liquid silicone rubber capability
into the Group
•Relocated and beginning to realise growth linked to
existing and new OEM customers

7

8
FY19 Results23 August 2019
Skellerup HY20
NZ$ MillionHY17HY18HY19HY20
AgriEBIT8.49.59.610.1
Industrial EBIT7.210.011.79.9
Corporate EBIT(2.3)(2.1)(1.9)(2.0)
EBIT13.317.519.418.0
Finance costs0.60.90.91.3
Tax expense3.84.95.24.6
NPAT8.911.713.412.1
Reconciliation of Segment EBIT to Group NPAT

9
FY19 Results23 August 2019
This presentation contains not only a review of operations, but also some forward looking
statements about Skellerup Holdings Limited and the environment in which the company
operates. Because these statements are forward looking, Skellerup Holdings Limited's
actual results could differ materially.
Although management and directors may indicate and believe that the assumptions
underlying the forward looking statements are reasonable, any of the assumptions could
prove inaccurate or incorrect and, therefore, there can be no assurance that the results
contemplated in the forward looking statements will be realised.
Please read this presentation in the wider context of material previously published by
Skellerup Holdings Limited.
Skellerup Disclaimer

---

FY20
HALF
YEAR
REPORT

Business Review
Chair and CEO Report 3
Our Business Model 6
Financial Statements
Income Statement 9
Statement of Comprehensive Income 10
Statement of Changes in Equity 11
Balance Sheet 12
Cash Flow Statement 13
Notes to the Financial Statements 14
Corporate Directory 18
Contents
$2.8m
Revenue
$123.0m
$1.4m
EBIT
$18.0m
10%
Earnings per share
6.2cps
NPAT
$12.1m
$1.3m
Operating Cash Flow
$24.1m
$11.0m
Dividend
5.5cps
no change

Chair and CEO Review
$000 Unaudited
Half-year Ended
31 December 2019
Half-year Ended
31 December 2018
Percentage
Change
Revenue
122,976
120,1882%
Earnings before interest and taxation
17,998
19,412-7%
Net profit after taxation
12,073
13,413-10%
Earnings per share (cents)
6.20
6.89-10%
Dividend per share (cents)
5.50
5.500%
Cash (net debt)(34,654)(32,387)7%
Overview
At Skellerup we are continuing to focus on ou
r customers and delivering productivity and efficiency gains
across our operations to ensure secure, sustainable growth throughout the business. External factors can
i
mpact our ability to deliver and this was the case in the first half of FY20. Our Agri Division’s earnings grew
by 5 percent due to international sales growth and operational gains, but our Industrial Division’s earnings
were lower due to the impact of trade tariffs and slower demand for products we sell within the water
i
nfrastructure and oil and gas industries. As a result, Group earnings before interest and tax (EBIT)
was down 7 percent to $18.0 million, and net profit after tax was down 10 percent to $12.1 million.
We have maintained a strong balance sheet which of course is a key prerequisite for growth. Operating cash
flow was a record $24.1 million in the first half of the year. Our strong cash flows have enabled us to consistently
increase dividends over recent years and fund several acquisitions including Nexus and Silclear which were
acquired in 2019. At the end of December net debt stood at $34.7 million funding 14 percent of the total capital
employed in our business and up only fractionally on prior comparative period (pcp).
At Skellerup we are
continuing to focus
on our customers and
delivering productivity and
effi ciency gains across
our operations to ensure
secure, sustainable growth
throughout the business.
secure, sustainable growth
throughout the business.
secure, sustainable growth
throughout the business.

Agri Division
Growth in international markets and operational
gains pushed the Agri Division’s EBIT up 5 percent
on pcp to a record $10.1 million. Growth was
particularly strong in the US market where farmers
returns improved after a difficult period of high feed
costs and low milk prices. We have made process
improvements in our operating facilities, particularly
at Wigram and we expect to make further gains
in this regard.
Our products continue to play a crucial role in
maintaining milk quality and protecting animal
health. We recently strengthened our offering
with the acquisition of Silclear, which design
and manufacture silicone components. We are
working on opportunities to win new business
with these products.
Agri
$000 Unaudited
Half-year Ended
31 December 2019
Half-year Ended
31 December 2018
Percentage
Change
Revenue
44,214
42,2925%
Earnings before interest and taxation
10,092
9,6265%
Industrial
$000 Unaudited
Half-year Ended
31 December 2019
Half-year Ended
31 December 2018
Percentage
Change
Revenue
78,85077,9701%
Earnings before interest and taxation
9,91911,673-15%
Industrial Division
Trade tariffs, a reduction in oil and gas exploration
activity and a slowdown in infrastructure markets in
the US caused the Industrial Division’s EBIT to reduce
by 15 percent to $9.9 million from the pcp. We were
able to partially mitigate the impact of trade tariffs
with cost reduction initiatives, earnings growth from
new roofing and marine foam products and from the
Nexus business acquired in April 2019.
Our Industrial Division has delivered sustained
earnings growth over the past four years and this is
a trend we expect to continue. With our capability to
design and deliver consistent, high-quality products,
our strategy to grow by focusing on key original
equipment manufacturers (OEM) customers in
international markets is generating new business
and will continue to do so.
Skellerup has a
strong and broad
platform to overcome
market, trade and
environmental
challenges and
sustainably
grow earnings.
Skellerup FY20 Half year Report
4

Dividend
The Directors have declared an interim dividend of 5.5 cents per share (imputed 50 percent) the same as the
pcp. This will be distributed on 19 March 2020 to shareholders on the register at 5:00 pm on 6 March 2020.
Outlook
Skellerup has a strong and broad platform to overcome market, trade and environmental challenges and
sustainably grow earni
ngs. We have not seen any immediate impact of the coronavirus outbreak on our
business, but we expect a temporary impact on our supply chain. We are carefully monitoring and taking
actions to ensure we are best placed to respond to any challenges this might present. We have made a
strong start to the second half of the year, raising year-to-date NPAT ahead of pcp. We expect full-year
NPAT to be consistent with the record $29.1 million result achieved in the pcp.
Elizabeth (Liz) Coutts
Chair and Director
David Mair
Chief Executive Officer and Director
5

Our Business Model
Our Business Enablers
Agri Division
Industrial Division
Our economic performance
A strong balance sheet, low
debt, a very good dividend
yield and relatively low levels of
capital expenditure required to
maintain and grow the business.
Our people
A diverse, experienced, vibrant,
international team delivering
solutions for customers in over 80
countries.
Our operational capability
and capacity
World-class manufacturing and
distribution facilities and partners
in New Zealand, Australia, China,
Vietnam, UK, Italy and the US.
Our customer commitment
Customer-centric
development, partnering
to deliver both OEM and
branded product innovations.
Our environment
Reducing our impact on the
environment through decreasing
usage of important resources
and waste.
Our intellectual property
and innovation
Vast expertise and
capability in polymers
and elastomers, coupled
with world-leading tooling
design to deliver innovative,
dependable solutions for
our customers.
RED BAND
Skellerup FY20 Half year Report
6

Our Approach
World-leading in essential dairy
consumables, safeguarding milk quality,
animal health and welfare. Delivering
specialist footwear for the farming, fire,
forestry and electricity markets
Keeping potable water separate
from grey water for industrial
applications. Leveraging our
innovative intellectual property
across adjacent sectors
Developing strong and deep customer
relationships
We work closely with customers,
particularly with OEMs as part of
their product innovation teams.
Manufacturing critical components that
are often only a small part of a more
complex system
Our products are usually only a small part
of the total solution, but they are critical.
The risk of failure means OEM customers
prefer the trusted Skellerup brand.
Applying our intellectual know-how to
new applications
We are applying our expertise across new
industrial and agricultural markets. From
design to manufacture, our expertise in
polymer and elastomer technologies covers
the materials, the tooling and development,
and the process for manufacture.
7

Financial
Statements
for the half year ended 31 December 2019
Skellerup FY20 Half year Report
8

Income Statement
for the half-year ended 31 December 2019




Note
Half-year
Ended
31 Dec 2019
$000
(Unaudited)
Half-year
Ended
31 Dec 2018
$000
(Unaudited)
Revenue2
122,976
120,188
Cost of sales
(76,971)
(74,899)
Gross profit
46,005
45,289
Other income/(expenses)
366
(79)
Distribution expenses
(7,147)
(6,437)
Marketing expenses
(10,976)
(10,789)
Administration expenses
(10,250)
(8,572)
Profit for the period before tax, finance costs and share of net
profit of associates

17,998

19,412
Finance costs
(1,268)
(859)
Share of net profit of associates accounted for using the equity method
(31)
42
Profit for the period before tax
16,699
18,595
Income tax expense
(4,626)
(5,182)
Net after-tax profit for the period, attributable to owners of the Parent
12,073
13,413
Earnings per share
Basic earnings per share (cents)
6.20
6.89
Diluted earnings per share (cents)
6.20
6.89
Net tangible assets per share (cents)
61.37
64.93
9

Statement of Comprehensive Income
for the half-year ended 31 December 2019
Half-year
Ended
31 Dec 2019
$000
(Unaudited)
Half-year
Ended
31 Dec 2018
$000
(Unaudited)
Net profit after tax for the period
12,073
13,413
Other comprehensive income
Will be reclassified subsequently to profit or loss when
specific conditions are met
Net increase/(decrease) in cash flow hedge reserve
523
893
Income tax related to increase/(decrease) in cash flow hedge reserve
(152)
(250)
Not expected to be reclassified subsequently into profit or loss
Foreign exchange movements on translation of overseas subsidiaries
282
(1,288)
Income tax related to gains/(losses) on foreign exchange movements
of loans with overseas subsidiaries

-

21
Other comprehensive income net of tax
653
(624)
Total comprehensive income for the period attributable
to equity holders of the Parent

12,726

12,789
Skellerup FY20 Half year Report
10

Statement of Changes in Equity
for the half-year ended 31 December 2019
Fully Paid
Ordinary
Shares
Cash Flow
Hedge
Reserve
Foreign
Currency
Translation
Reserve
Employee
Share Plan
Reserve
Retained
Earnings
Total
$000
(Unaudited)
$000
(Unaudited)
$000
(Unaudited)
$000
(Unaudited)
$000
(Unaudited)
$000
(Unaudited)
Balance 1 July 201972,173132(9,771)149115,709178,392
Profit for the period----12,07312,073
Other comprehensive income-371282--653
Total comprehensive income
for the period
-371282-12,07312,726
Share incentive scheme---113113
Dividends paid----(14,607)(14,607)
Balance 31 December 2019
72,173503(9,489)262113,175176,624
Balance 1 July 201869,732(397)(8,059)471110,539172,286
Profit for the period----13,41313,413
Other comprehensive income-643(1,267)--(624)
Total comprehensive income
for the period
-643(1,267)-13,41312,789
Share incentive scheme2,441--(434)4522,459
Dividends paid----(13,633)(13,633)
Balance 31 December 201872,173246(9,326)37110,771173,901
11

Balance Sheet
as at 31 December 2019
As at
31 Dec 2019
$000
(Unaudited)
As at
30 Jun 2019
$000
(Audited)
As at
31 Dec 2018
$000
(Unaudited)
Current assets
Cash and cash equivalents
13,625
9,6398,464
Trade and other receivables
40,215
50,75941,124
Inventories
50,511
48,33954,907
Income tax receivable
9
1,4651,974
Derivative financial assets
698
310425
Total current assets
105,058
110,512 106,894
Non-current assets
Property, plant and equipment
90,054
91,29691,369
Right of use assets
19,862
--
Deferred tax asset
2,643
2,8223,088
Goodwill
54,511
49,47645,363
Intangible assets
1,233
1,057398
Investment in associate
1,702
1,7231,758
Derivative financial assets
284
173175
Total non-current assets
170,289
146,547 142,151
Total assets
275,347
257,059 249,045
Current liabilities
Trade and other payables
21,246
22,99522,712
Provisions
4,744
4,8404,984
Income tax payable
837
9602,901
Derivative financial liabilities
132
118129
Lease liabilities - short term2,947--
Total current liabilities29,90628,913 30,726
Non-current liabilities
Provisions
1,381
1,4061,650
Interest-bearing loans and borrowings
48,279
46,21540,851
Deferred tax liabilities
1,978
1,9501,788
Derivative financial liabilities
152
183129
Lease liabilities - long term17,027--
Total non-current liabilities68,81749,754 44,418
Total liabilities
98,723
78,667 75,144
Net assets
176,624
178,392 173,901
Equity
Share capital72,17372,17372,173
Reserves(8,724)(9,490)(9,043)
Retained earnings113,175115,709110,771
Total equity176,624178,392 173,901
Skellerup FY20 Half year Report
12

Cash Flow Statement
for the half-year ended 31 December 2019
Half-year
Ended
31 Dec 2019
$000
(Unaudited)
Half-year
Ended
31 Dec 2018
$000
(Unaudited)
Cash flows from operating activities
Receipts from customers
133,881127,972
Interest received
8
6
Dividends received
2
1
Payments to suppliers and employees
(105,855)
(111,108)
Income tax paid
(3,170)
(2,966)
Interest and bank fees paid
(811)
(859)
Net cash flows from/(used in) operating activities
24,055
13,046
Cash flows from investing activities
Proceeds from sale of property, plant and equipment
32
169
Payments for property, plant and equipment
(2,384)
(1,900)
Payments for Intangible assets
(5,154)
(26)
Payments for investment in associate
-
(1,674)
Net cash flows from/(used in) investing activities
(7,506)
(3,431)
Cash flows from financing activities
Proceeds from loans and advances
2,064
451
Proceeds from issue of shares
-
2,422
Dividends paid to equity holders of Parent
(14,607)
(13,633)
Net cash flows from/(used in) financing activities
(12,543)
(10,760)
Net increase/(decrease) in cash and cash equivalents
4,006
(1,145)
Cash and cash equivalents at the beginning of the period
9,639
9,681
Effect of exchange rate fluctuations
(20)
(72)
Cash and cash equivalents at the end of the period13,6258,464
13

Notes to the Financial Statements
as at 31 December 2019
1. Corporate Information
The financial statements of Skellerup Holdings Limited, for the half year ended 31 December 2019, were
authorised for issue in accordance with a resolution of the Directors dated 12 February 2020.
Skellerup Holdings Limited (‘the Company’) is a limited liability company incorporated and domiciled in
New Zealand. It is registered under the Companies Act 1993 with its registered office at Level 3, 205 Great
South Road, Greenlane, Auckland. The Company is a Reporting Entity in terms of the Financial Markets
Conduct Act 2013 and is listed on the New Zealand Exchange (NZX Main Board) with the ticker SKL.
Summary of Significant Accounting Policies
a) Basis of Preparation
This general-purpose condensed financial report for the half year ended 31 December 2019 has been
prepared in accordance with NZ IAS 34 Interim Financial Reporting and IAS 34 Interim Financial Reporting.
The half year financial report does not include all notes of the type normally included within the annual financial
report and, therefore, cannot be expected to provide as full an understanding of the financial performance,
financial position and financing and investing activities of the consolidated entity as does the full financial report.
It is recommended that the half year financial report be read in conjunction with the annual report for the year
ended 30 June 2019 and considered together with any public announcements made by Skellerup Holdings
Limited during the half year ended 31 December 2019 in accordance with the continuous disclosure obligations
of the NZX listing rules.
All accounting policies and methods of computation are the same as those adopted in the most recent annual
financial report with the exception that the Group has applied NZ IFRS 16: Leases with effect from 1 July 2019.
The impact of this is disclosed in Note 4. Certain prior year figures have been reclassified for comparative
purposes.
The financial statements are presented in New Zealand dollars and all values are rounded to the nearest
thousand dollars ($000).
2. Segment Information
The Group’s operating segments are Agri, Industrial and Corporate; these are the divisions reported to the
executive management and Board of Directors to assess performance of the Group and allocate resources.
The principal measure of performance for each segment is EBIT (earnings before interest and tax). As a result,
finance costs and taxation have not been allocated to each segment.
Agri Segment
The Agri segment manufactures and distributes dairy rubberware, which includes milking liners, tubing,
filters and feeding teats, together with other related agricultural products and dairy vacuum pumps,
to global agricultural markets
Industrial Segment
The Industrial segment manufactures and distributes technical polymer products across a number of industrial
markets, including automotive, construction, infrastructure, mining and general industrial, together with
industrial vacuum pump equipment for a variety of industrial applications worldwide.
Corporate Segment
The Corporate segment includes the Parent Company and other central administration expenses that have
not been allocated to the Agri and Industrial segments.
Skellerup FY20 Half year Report
14

2. Segment Information (continued)

For the half-year ended
31 December 2019
Agri

$000
Industrial

$000
Corporate/
Elimination
$000
Total

$000
Revenue
44,21478,850(88)122,976
Segment EBIT
10,0929,919(2,013)17,998
Profit before tax, finance costs and share
of net profit of associates
17,998
Finance costs
(1,268)
Share of net profit of associates
(31)
Profit before tax
16,699
Income tax expense
(4,626)
Net after-tax profit
12,073
Assets and liabilities
Segment assets
123,058132,97719,312275,347
Segment liabilities
11,41434,98952,32098,723
Net assets
111,64497,988(33,008)176,624
Other segment information
Capital expenditure
6,2781,28587,571
Cash flow
Segment EBIT
10,0929,919(2,013)17,998
Share of net profit of associates
-(31)-(31)
Adjustments for:
- Depreciation and amortisation
2,0791,629203,728
- Depreciation right of use assets
3062,028372,371
- Non-cash items
461461
Movement in working capital
4854,5973405,422
Segment cash flow
12,96218,142(1,155)29,949
Finance and tax cash expense
(3,981)
Movement in finance and tax accrual
(1,913)
Net cash flow from operating activities
24,055
15

2. Segment Information (continued)

For the half-year ended
31 December 2018
Agri

$000
Industrial

$000
Corporate/
Elimination
$000
Total

$000
Revenue42,29277,970(74)120,188
Segment EBIT9,62611,673(1,887)19,412
Profit before tax, finance costs and share of
net profit of associates
19,412
Finance costs(859)
Share of net profit of associates42
Profit before tax18,595
Income tax expense(5,182)
Net after-tax profit13,413
Assets and liabilities
Segment assets115,861115,67717,507249,045
Segment liabilities8,04818,94948,14775,144
Net assets107,81396,728(30,640)173,901
Other segment information
Capital expenditure6911,174661,931
Cash flow
Segment EBIT9,62611,673(1,887)19,412
Share of net profit of associates-42-42
Adjustments for:
- Depreciation and amortisation2,0821,474343,590
- Non-cash items--560560
Movement in working capital1,363(5,859)(21)(4,517)
Segment cash flow13,0717,330(1,314)19,087
Finance and tax cash expense(3,825)
Movement in finance and tax accrual(2,216)
Net cash flow from operating activities13,046
Skellerup FY20 Half year Report
16

3. Dividends Paid
Half-year
Ended
31 Dec 2019
$000
Half-year
Ended
31 Dec 2018
$000
Declared and paid during the period
Final dividend for June 2019 year on ordinary shares of 7.5 cents per share,
imputed to 50%, paid on 17 October 2019
(2018: 7.0 cents per share imputed to 55%, paid on 11 October 2018)
Net dividend paid14,60713,633
Subsequent to the six-month period, the Board of Directors resolved to pay an interim dividend of 5.5 cents
per share (imputed 50%), on the 194,753,340 ordinary shares on issue for a total amount of $10,711,434.
The dividend will be paid on 19 March 2020 to shareholders on the register at 5.00pm on 6 March 2020.
The Dividend Reinvestment Plan will not be operative for this dividend payment.
This compares to the prior-year interim dividend of 5.5 cents per share, totalling $10,711,434 which was paid
on 21 March 2019.
4. Right of use Assets
The Group adopted NZ IFRS 16: Leases with effect from 1 July 2019 using the modified retrospective approach
to transition. As such, comparative figures have not been restated. On transition the Group recognised a right
of use asset of $18,491,000 and a corresponding lease liability of $18,491,000 principally related to the lease of
properties. The adoption of NZ IFRS 16 had no impact on retained earnings. Overall the adoption of NZ IFRS 16
did not have a material impact on the results or financial position of the Group.
5. Interest-bearing Loans and Borrowings
Bank loans are provided under a $60 million multi-currency facility agreement with ANZ Bank New Zealand
Limited which has a review date of 30 November 2021.
6. Events after the Balance Sheet Date
There have been no subsequent events after 31 December 2019 requiring disclosure.
17

Corporate Directory
Directors
EM Coutts, ONZM, BMS, FCA, CFloD
Chair
BD Cushing, BCom, ACA
AR Isaac, CNZM, BCA, FCA
DW Mair, BE, MBA
WJ Strowger, LLB (Hons)
O f fi c e r s
DW Mair, BE, MBA
Chief Executive Officer
GR Leaming, BCom, CA
Chief Financial Officer
Registered Offi ce
L3, 205 Great South Road
Greenlane
Auckland 1051
New Zealand
PO Box 74526
Greenlane
Auckland 1546
New Zealand
Email: ea@skellerupgroup.com
Telephone: +64 9 523 8240
Website: www.skellerupholdings.com
Legal Advisors
Chapman Tripp
23 – 29 Albert Street
Auckland 1010
New Zealand
Bankers
ANZ Bank New Zealand Limited
23 – 29 Albert Street
Auckland 1010
New Zealand
Auditors
Ernst & Young
2 Takutai Square
Britomart
Auckland 1010
New Zealand
Share Registrar
Computershare Investor Services Limited
Private Bag 92119
Auckland 1142
New Zealand
159 Hurstmere Road
Takapuna
Auckland 0622
New Zealand
Managing your shareholding
Online
To change your address, update your payment instructions and
to view your investment portfolio including transactions, please visit:
www.computershare.co.nz/investorcentre
General enquiries
Email: enquiry@computershare.co.nz
Telephone: +64 9 488 8777
Facsimile: +64 9 488 8787
Please assist our registrar by quoting your Common Shareholder Number (CSN).
Skellerup FY20 Half year Report
18

19

Skellerup Holdings Limited
L3, 205 Great South Road
Greenlane, Auckland 1051, New Zealand
PO Box 74526, Greenlane
Auckland 1546, New Zealand
E ea@skellerupgroup.com
T +64 9 523 8240
W www.skellerupholdings.com