PWR Holdings Limited: Setting the business up for the long term

About the author:

Author name:

By Alex Lu

Job title:

Analyst

Date posted:

18 August 2023, 10:30 AM

Sectors Covered:

Industrials

• PWR Holdings Limited's (ASX:PWH) FY23 result overall was largely in line with expectations.
• Divisional revenue growth: Motorsports +16%, Aftermarket +15%, Emerging Technologies +14%, OEM +22%.
• Key positives: Aerospace & Defence revenue jumped 48% with a stronger pipeline compared to the prior year; Balance sheet remains healthy with net cash (ex-leases) of $17.6m.
• Key negatives: Normalised EBITDA margin was down 160bp to 33.8% due mainly to higher labour costs; ROE fell 270bp to 24.6%.
• We make minor adjustments to earnings forecasts with FY24-26F normalised EBITDA increasing by 2-3%. However, normalised NPAT reduces by 1-2% due largely to higher D&A expense.
• Our target price falls to (login to view) and we maintain our Add rating.

Find out more

You can find further detailed analysis of company results this reporting season by browsing our reporting season tag, and view a full list of upcoming results on our Reporting Season Calendar.

If you would like more information, please contact your adviser or nearest Morgans office.

Disclaimer: The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents (“Morgans”) do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.