Richard Smyth
PO Box 58880, Botany, Auckland 2163, New Zealand

Steel & Tube Holdings Limited Analysis


Steel & Tube was formed in 1953 and listed in 1967. It is now one of New Zealand's leading providers of steel solutions, allowing access to the widest range of steel products in the market, through its nationwide network of distribution centres. The company distributes and processes a range of steel products and operates through two divisions - Distribution and Infrastructure - and offers an end to end customer experience, advising, sourcing and supplying customers with their steel requirements.

The acquisition of complementary businesses over the years has led to Steel & Tube owning a portfolio of strong heritage brands. The company is focused on delivering quality service and products, safely to customers.


Today, Steel & Tube operates in the New Zealand market, primarily in the construction, manufacturing and rural sectors.


The following information was extracted from Steel & Tube Holdings Limited's Half Year Results, released on 20 February 2024:

Solid result in a more challenging trading environment

Steel & Tube Holdings Limited (NZX: STU) has reported its unaudited results for the six months to 31 December 2023, with Normalised EBIT of $11.3m, above the top end of guidance, a further reduction in inventory and a positive cash position with no bank debt.

$m / 1H24 / 2H23 / 1H23

Revenue / 261.8 / 273.8 / 315.3

EBITDA / 21.2 / 21.4 / 30.5

Normalised EBITDA* / 21.9 / 21.3 / 31.6

EBIT / 10.2 / 10.7 / 20.3

Normalised EBIT* / 11.3 / 10.6 / 21.5

NPAT / 5.3 / 5.2 / 11.8

Net operating cashflow / 38.7 / 57.1 / 41.1

Dividends (cents per share) / 4.0 / 4.0 / 4.0

1H24 Financial Performance

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 $261.8m. 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.

The company also achieved a further reduction in inventory down to $128.6m, from $139.2m at 30 June 2023. Steel & Tube ended the half year with no bank debt and a positive cash balance of $26.3m, representing a ~$20m improvement on 30 June 2023. In addition, the company has an undrawn $100m bank facility in place to support growth.

The Board is pleased to declare a 1H24 fully imputed dividend of 4 cents per share. This has been maintained at the 1H23 level, reflecting the Board’s confidence in the company’s performance and outlook.

Disclaimer: This section is provided as general information only. It is not intended as a substitute for legal or professional advice to company directors and officers or investors. NZX Limited disclaims any liability arising from the use of this information.