Harvey Norman Holdings (HVN) H2 2024 earnings summary

Executive summary

• FY24 profit before tax (PBT) excluding AASB 16 and property revaluations was $540.07m, down 20.6% year-over-year; reported PBT was $541.69m, down 30.2% from FY23.

• Net assets rose 1.6% to $4.54bn, with a 41.9% increase since June 2019 and a 5-year CAGR of 7.2%.

• Total system sales revenue was $8.86bn, a 3.6% decrease from FY23.

• Operating cash flows reached $686.53m, with cash conversion at 100.4%.

• The omni-channel strategy and expansion in digital and global store network position the business for future growth.

Financial highlights

• EBITDA was $898.26m, down 20.6% from FY23; adjusted EBITDA was $686.61m, down 15.5%.

• Reported profit after tax & NCI was $352.45m, down 34.7% year-over-year.

• Basic EPS was 28.29c, down from 43.30c in FY23.

• Net debt to equity ratio at 14.49%, reflecting conservative leverage.

• Total assets reached $7.93bn, up 3.3% from June 2023, anchored by a $4.23bn property portfolio.

Outlook and guidance

• Up to 10 new stores planned in Malaysia for FY25, aiming for 80 stores by 2028.

• Two new full-format stores to open in New Zealand in 1H25; UK flagship store to open in October 2024.

• Anticipates sales growth in FY25 and beyond from the emerging AI-PC market and innovation in Home Appliances, Mobile & Computer Technology.

• Positioned to benefit from improvements in retail trading, home renovation cycles, new home constructions, and net migration increases.

• Expansion into Hungary cancelled due to unfavorable conditions.