BSA recently put out its year-end results and announced a 1c special dividend to go along with the 1c final dividend. Equivalent full-year dividend payout ratio is an impressive 13%. But forget the dividends, let’s look at how BSA performed as a business.
Revenue up 22% to $403m
EBITDA up 16% to $16.3m
NPAT down 5.5% to $8.6m
EPS down from 4.48c to 4.02c
Operating Cash Flow up 226% to $28.4M
Other key milestones include 2 acquisitions (MEC and Burke Air) and the integration of the Allstaff group. The chairman has also shaved off his moustache. The board are in the process of a new 3 year plan for FY12-14, focusing on cash generation to fund more acquisitions.
Despite a share price being smashed, I think BSA are doing all the right things. They were right to make the sideways move into HVAC while the mature Foxtel contract continues to slow down, meanwhile they can optimise the profitability of this while they focus on HVAC for future growth. The balance sheet is solid, acquisition strategy is sound, and cash is being generated at a massive rate; so this business still presents itself as a low-risk proposition for me.