Site menu

Search by ticker code:
Generic filters


Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Nick Scali (ASX:NCK) share price in focus on HY24 result, big dividend

The Nick Scali Limited (ASX: NCK) share price is under the spotlight after the company announced its FY24 first-half result.

Nick Scali is a furniture retailer that owns the Nick Scali and Plush-Think Sofas businesses.

HY24 result

Here are some of the highlights from the six months to 31 December 2023:

  • Revenue fell 20.2% to $226.6 million
  • Gross profit margin improved 360 basis points (3.60%) to 65.6%
  • EBITDA (EBITDA explained) fell 19% to $89.9 million
  • EBIT fell 25% to $67.7 million
  • Net profit after tax (NPAT) fell 29% to $43 million
  • Profit / earnings per share (EPS) sank 29% to $0.531
  • Interim dividend of $0.35 per share

That profit generation of $43 million was above the company’s guidance of between $40 million to $42 million.

Interestingly, group written sales orders for the period were $212.7 million, up 1.1% year on year, and the FY24 second quarter sales orders were 8.2% higher year on year. Revenue in HY23 benefited from increased deliveries as the elevated June 2022 order book reduced, with lead times returning to pre-COVID levels over HY23.

Nick Scali brand online written sales orders were $14.7 million in Hy24, up 22.5% year on year.

During the half, it opened a new and larger Nick Scali store in Payneham (South Australia), with the existing store being converted to a clearance store. Two new Plush stores were opened, one in Helensvale (Queensland) and Payneham (South Australia). One Plush store was closed.

Use of capital

One of the major focuses of the business is its new Queensland distribution centre, with $8.5 million of construction costs in the period – it’s expected to be completed in the FY24 third quarter. The total construction cost is expected to be $16.2 million, as well as $7.8 million for the purchase of the land in FY23.

Nick Scali said it repaid $20 million of corporate debt in the half-year period, which was used to buy Plush in 2021. The debt has been reduced to $28 million.

As mentioned, Nick Scali is going to pay an annual dividend per share of $0.35, representing a dividend payout ratio of 66%.

It finished the period with cash of $68.3 million.

Trading update

Nick Scali revealed that January 2024 written sales orders amounted to $58.9 million, up 3.6% year on year.

Final thoughts on the Nick Scali share price

The company has a long-term target of 86 Nick Scali stores and between 90 to 100 Plush stores, which gives the company plenty of room to grow. The growth of its online sales is also a good bonus.

Nick Scali is proving to be one of the best retailers in Australia and it’s more resilient than some investors may have thought. I think it’s a good business to buy when conditions are difficult, but it has already recovered significantly, so I’d be willing to be patient from here for a better price.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, Jaz does not have a financial or commercial interest in any of the companies mentioned.
Skip to content