The embattled company reported that profitability had been affected by a reduction in top line revenue of 4 per cent, compared to the same period last financial year.
EBITDA (earnings before interest, tax, depreciation and amortisation) increased to $8.4 million – up from $5.4 million in the first half of the previous year. A slim profit after tax of $200,000 was recorded – a turnaround after the horror $69 million loss for the first half of last financial year.
Net debt was reduced from $24.2 million to $20.9 million.
Hills has had another difficult year, ending a licensing contract with Woolworths after the supermarket giant’s Masters Home Improvement disaster, selling off the right to manufacture its home and garden products including the iconic Hills Hoist, abandoning a proposed merger of part of the business, and staff retrenchments.
CEO David Lenz, appointed last September, said the company’s focus in the second half of the financial year would be on growth.
“Hills will start to move beyond the recent stabilisation phase and focus on profitable growth opportunities in the remainder of FY17 and beyond,” he said.
He said Hills was now “solely focused” on the value-added distribution of technology and services.
The results, however, reveal some challenges in this market.
Hills says profitability was hit due to a number of factors, including competition from Chinese brands in the low-end CCTV market and reductions in antenna sales following changes to a major customer’s “distribution model”.
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