26 August, 2021
Annual Report to 30 June 2021
The 2021 financial year was a continuation of the positive momentum we have been building over the past number of years.
We have remained focused on building our automation business, while also improving profitability. We have made positive progress on both those fronts.
This has been achieved in a Covid world, which is testament to our team and the strength and relevance of the products and solutions we design and deliver.
• Net Profit After Tax of $4.1m, up from $934k in the prior year
• Revenue of $51m, an increase of 6% over the prior year
• EBITDA $3.7m, a 50% increase on the prior year
• Automation 78% of group sales revenue vs 61% for the prior year
• $7m cash on hand at year end and improved operating cashflow
• Undrawn bank facilities of $6m at year end
• Sale of our New Plymouth property for $4m
• Acquisition of Southern Cross Engineering
• Completion of our rebranding to MHM Automation
Revenue for the year of $50.9m was up 6.1% on the prior year, largely driven by the continued strong performance of the Milmeq chilling and freezing business in Australia.
The full year EBITDA was $3.73m, a 50% increase on the prior year’s $2.48m. Improving our margins continues to be a focus and the work is starting to produce results. We will continue to drive improvement in the year ahead as we integrate our operations and bed in our new group-wide ERP which is due to go live later in the year.
The after-tax profit of $4.1m was a 339% increase on the prior year result of $0.9m. During the year we closed our New Plymouth operation and sold the property, which led to a gain of $1.65m to the Group’s Comprehensive Income.
The combined sale of the New Plymouth property and subsequent gain on revaluation of our Christchurch property gave rise to a gain on disposal of $1.65m and a revaluation increase of $1.9m respectively. The total Comprehensive Income was $6m versus $0.87m for the prior year.
The Automation business had a strong year, with revenue of $53m and EBITDA of $4.8m (before Corporate cost). Most pleasing in this result was the EBITDA margin improvement to 9.1% from 3.9% a year earlier. Margin improvement was a focus through the year, and while
there is still much work to be done to take our margins higher again, we have made good progress. This was assisted by a change in structure, with the appointment of John Fredericksen as COO across the group. This focus on operational improvement will continue in the coming years.
We are seeing good demand for our products and solutions, right across our portfolio. The automation business, particularly the chilling and freezing business, has workflows through the financial year, with orders now being taken for delivery in the 2023 financial year. All areas of the business are running at or near capacity in the short term, and through the remainder of the 2021 calendar year.
We do face challenges though. While demand for our products and our solutions is strong, execution of these opportunities and delivery of them is being impacted by the restrictions on international travel (particularly the MIQ system) and resource constraints. We are expecting this situation to ease in 2022.
Acquisitions have been key in our growth and transition to a technology led company. There continues to be many NZ based companies designing and supplying world leading equipment and automated solutions to the world that are sub-scale. We see a consolidation of the broader sector as an attractive play and will continue to seek opportunities that align with this strategy.
Global demand for automated solutions continues to increase. We are well positioned with a portfolio for industry leading IP and solutions. The 2022 financial year will be focused on the execution of the work we have today, improving margins, and building a sustainable pipeline of new opportunities globally.