Skellerup's net profit hits a record $40.2m, lifts dividend

Skellerup's net profit hit a record high in 2021, driven mostly by its industrial division. Photo / Supplied

Specialised rubberware manufacturer Skellerup reported a record $40.2 million net profit in the June year, up 38 per cent over the previous year, driven mostly by a strong showing from its industrial division.

Revenue came to $279.5m, up 11 per cent on the prior comparative period.

Earnings before interest and tax (EBIT) was $56.4m, up 33 per cent.

The industrial division's ebit came to $32.7m, up 57 per cent, while the agri division's ebit was $30.5m, up 20 per cent.

Net debt fell to $8.7m, down $19.8m on the previous year's.

Skellerup declared a final dividend of 10.5 cents, bringing the total dividend to 17 cents per share for the year, up 31 per cent.

Chief executive David Mair said the growth in earnings was the outcome of the company continuing to work closely with key customers to provide engineered products.

Skellerup's products are used in the supply of safe potable water and in the production of milk and milk products.

The company is the second-largest manufacturer of food-grade dairy rubberware in the world.

The US and New Zealand remain its largest markets, but Europe and Asia were the fastest growing over 2021.

Chair Liz Coutts noted that operating cash flow – which was up 22 per cent to a record $58.8m would ensure the firm had the capacity to continue to fund growth.

Skellerup's final dividend has almost trebled over the last 10 years.

"This demonstrates Skellerup's strong cash flow and the board's practice of paying out a consistently high proportion of earnings," Coutts said.

She added the group has started strongly in the current 2022 financial year.

Skellerup's shares last traded at $5.45, up 20c, or 3.8 per cent on Wednesday's close.