Steel & Tube Earnings Guidance FY23

Company Announcement
10 May 2023







Steel & Tube Holdings Limited, PO Box 58880, Botany, Auckland 2163, New Zealand
P +64 4 570 5000 www.steelandtube.co.nz

STU Trading Update and FY23 Earnings Guidance

Steel & Tube Holdings Limited (NZX: STU) has today provided earnings guidance for the financial year
ending 30 June 2023 (FY23).

The company continues to perform well against a backdrop of tightening economic conditions and
weather events over the past 10 months. Revenues have continued to grow driven by elevated
international pricing. Higher input prices and cost pressures have impacted margins. Steel & Tube has
built a resilient platform exhibited by significant reductions in debt and inventory positions, and solid
underlying cash generation. The company has a strong balance sheet and substantial bank facilities in
place to fund growth and to take advantage of opportunities.

Given the recessionary operating environment, 2H23 volumes are expected to be 10% to 15% less than
1H23. As such, Steel & Tube is forecasting FY23 normalised EBIT of between $28m and $32m and
normalised EBITDA of between $48m and $52m
1
.

Steel & Tube has a track record of effectively navigating changes through economic cycles and is
undertaking a comprehensive cost out programme focusing on $5m of operating costs in FY24. As a
result of these initiatives, the company is expecting that FY24 operating costs will be flat to FY23.

Steel & Tube’s unaudited 10-month performance to end-April is summarised below:

$millions

FY23
10 months
FY22
10 months
FY21
10 months
Revenue 489.0 479.3 384.6
EBITDA 40.8 53.6 29.5
Normalised EBITDA 41.7 54.0 28.6
EBIT 23.6 37.9 14.8
Normalised EBIT 24.5 38.3 13.8
NPAT 12.4 24.1 7.4
Operating Cash flow 77.9 (38.1) 20.5
Dividends paid 19.1 14.6 2.0
Inventory 152.2 200.9 108.3
Net (Debt)/Cash (9.2) (43.5) 19.7

CEO of Steel & Tube, Mark Malpass, said: “We have focussed on strengthening the core business platform
and new strategic initiatives now account for 7.5% of Distribution earnings as we focus on growth of

1

Normalised EBITDA and Normalised EBIT have been adjusted to exclude non-trading adjustments of approx. $0.9m
primarily relating to Software as a Service costs.

higher value products and services. The recent expansion of Steel & Tube’s aluminium offer is proving
popular.

“The company has a healthy pipeline of work in place across a diverse range of industries. The
Government has estimated the cyclone and flooding rebuild costs at between $9 billion and $14.5 billion,
with half of that related to public infrastructure. Steel is an essential construction material, as
demonstrated in the Canterbury rebuild, and Steel & Tube has the capability and capacity, as well as the
expertise to deliver innovative solutions to assist with rebuilding vital assets.”

ENDS

For media or investor enquiries, please contact: Jackie Ellis Tel: +64 27 246 2505 or
email: jackie@ellisandco.co.nz


For further information please contact:
Mark Malpass
Steel & Tube CEO
Tel: +64 27 777 0327
Email: mark.malpass@steelandtube.co.nz
Richard Smyth
Steel & Tube CFO
Tel: +64 21 646 822
Email: richard.smyth@steelandtube.co.nz