Seven Group posts ‘record’ result as profits skyrocket

Seven Group Holdings (SGH) this morning announced that net profit for the last financial year spiked by 16%, up to $398.9 million.

Total revenues increased 6% to $4.752 billion, while underlying earnings before interest, tax, depreciation and amortisation lifted 9% to $686m, with final dividend matching the 20 cents paid last year.

The impressive result was helped by robust demand from the energy & resources sector, with SGH's Westrac arm showing significant growth, added to a multi-million dollar gain on the $491 million sale of its share in Consolidated Media Holdings.

WesTrac Australia posted a record result for the year, delivering a total revenue of $4,113.6 million, up 16% on the prior year.

Despite the impressive figures, SGH has warned that earnings could suffer a big drop in the current financial year due to changing trading conditions across its industrial and media divisions.

Seven West Media reported EBIT of $422.0 million for the last financial year, down 10.9% on the previous year, while EBITDA was $480 million, down 10.3% on the 2011-2012.

The Group said in a statement: "Seven West Media is anticipating that overall advertising markets will remain subdued with low single digit growth in television, and a continuation of the current trend experienced in newspapers, but the rate of decline in magazines is expected to lessen."

Commenting on the results, Don Voelte, managing director and CEO of SGH, said: “The group delivered a record result underpinned by an exceptional performance in the WesTrac business in the first half. The second half, however, was very challenging across all our industrial services businesses as a result of the downturn in the mining market.

“This has necessitated a number of initiatives across the portfolio as we respond to competitive market conditions. The general downturn is now bifurcating by commodity type, most acutely impacting our New South Wales coal derived businesses.

“The Seven West Media investment delivered a strong result also in a challenging market and I have great faith in the management team under their new leadership to continue to execute on their strategies. Our broader portfolio of property and other strategic investments also delivered during the year and there will be more focus on these as we move forward. Our balance sheet is very strong with over $1 billion of debt reduction during the year and we are well placed to take advantage of opportunities to broaden and diversify our portfolio,” he added.

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