DuluxGroup Limited (ASX:DLX) has announced its 2019 half-year results this morning. Here’s what you need to know.
About Dulux
Founded in 1918, Dulux has steadily grown to become the leading marketer and manufacturer of premium paint products across Australia and New Zealand. Their trusted brands include Dulux, Selleys, Yates, B&D, and Cabot’s. Dulux is now a global company employing over 4,000 people in Australia, New Zealand, PNG, South East Asia, China and the UK.
Last month, Nippon Paint Holdings proposed to acquire Dulux at a price of $9.80 per share. This acquisition is expected to go ahead later this year.
Here Are The Three Key Points
- Sales revenue and EBIT were flat
- Market volume decline of 4% in core decorative paint business, reflecting an unusually strong prior period
- Regarding the acquisition – Scheme booklet including Independent Experts Report is expected to be delivered late June
Strong Second Quarter Made Up For Weak Start
Dulux managing director Patrick Houlihan described the first quarter as “particularly challenging” but said it was offset by stronger performance in the second quarter.
“Overall, sales revenue and EBIT were flat for the half excluding last year’s favourable one-offs”, he said.
“The first quarter was particularly challenging, as predicted, offset by a stronger second quarter, in which revenue growth returned to a more normal 4% level.”
Special Dividend
Dulux declared an interim dividend of 15cps, fully franked, up 7.1% on the prior year. A special dividend of 28cps was also announced.
Both dividends will be paid on 28th June 2019.
Acquisition Update
A Scheme booklet, which will include the Independent Experts Report, is expected to be delivered to shareholders in late June. This will give shareholders all the information they need regarding the takeover by Nippon.
The Scheme meeting, where shareholders will vote on the Scheme, will take place either late July or early August.
The deal looks very likely to go ahead, as the Dulux Board has already unanimously recommended shareholders vote to accept the deal.
The share price is unlikely to move in response to today’s announcement. As long as the acquisition looks set to go ahead, you can expect the share price to remain glued around the $9.80 price.
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Disclosure: At the time of writing, Max does not own shares in any of the companies mentioned.
