The Ansell Ltd (ASX: ANN) share price jumped 6% in response to the company’s HY25 result.
Ansell is the manufacturer of various industrial and healthcare protective gloves. Some of its brands include HyFlex, Ringers, MICROFLEX, TouchNTuff, GAMMEX, AlphaTec and Kimtech.
HY25 result
Here are some of the highlights from the six months to 31 December 2024, with the amounts being US dollars:
- Sales increased 29.9% to $1.02 billion
- EBIT improved 62.9% to $127.4 million
- Adjusted earnings per share (EPS) rose 35.5% to $0.557
- Statutory EPS up 143.9% to $0.378
- Dividend per share up 34.5% to $0.222
The business also reported its organic performance, which excludes foreign currency exchange changes, as well as the effects of acquisitions, divestments and business exits.
It completed the KBU acquisition on 1 July 2024, while the retail household gloves business was exited in FY24.
Organic sales grew 12.5%, organic EBIT rose 20.9% and organic adjusted EPS climbed 33.6%.
Its industrial segment saw strong sales growth of 8.1%, with growth in both the mechanical and chemical divisions, supported by growing customer usage and stocking of new products.
The healthcare segment saw sales recovering from the customer destocking effects experienced in the first half of FY24.
Its profit benefited from improved manufacturing utilisation and increased APIP savings.
Outlook for the Ansell share price
In the second half, the company expects to see continued (but slower) organic sales growth despite subdued industrial demand and uncertainty related to changing trade policies in various countries. However, growth in key healthcare segments won’t be boosted by a recovery from customer destocking activity.
The company expects to complete the integration of KBU and exit transitional service arrangements earlier than originally assumed, potentially accelerating its ability to reach its $10 million cost synergies target.
Ansell also indicated that earnings growth is expected to be supported by increased prices to offset the impact of higher raw material costs in the first half of FY25, reduced reliance on air freight and the KBU cost synergies.
The company also noted it has plans to increase prices to substantially offset tariff increases.
Ansell increased its guidance range for FY25 adjusted EPS to a range of US$1.18 to US$1.28.
I think Ansell has demonstrated its quality in this result, however the Ansell share price is up more than 50% in the past year, so it’s not as cheap as it was. How high can it go this year? That’s not the sort of investment bet I like to make.
