Breville share price on watch as dividends climb 10.8% higher

The Breville Group Ltd (ASX: BRG) share price is one to watch this morning after reporting a 10.8% increase in total dividends.

The Aussie home appliance manufacturer reported its earnings for the full year ended 30 June 2020 (FY20).

That result was headlined by a 25.3% increase in revenue to $952.2 million while gross profit jumped 18.2% higher to $320.6 million.

What did Breville announce?

That revenue growth was underpinned by strong performance across Breville’s various geographic segments and a strong US dollar.

Europe was the biggest growth segment in percentage terms, with segment revenues climbing 54.8% to $143.3 million. Rest of World (ROW), Australia and New Zealand (ANZ) and North America climbed 25.6%, 18.3% and 11.3%, respectively.

Earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 11.0% to $126.5 million, however, net profit after tax edged 1.8% lower to $66.2 million.

There was strong EBIT growth in both Breville’s Global Product and Distribution segments, climbing 14.5% and 23.8%, respectively.

The Breville share price will be worth watching today as the company reported a total dividend of 41.0 cents per share, franked to 60.0%.

Based on yesterday’s closing price of $27.29, that represents a 1.50% dividend yield for the ASX 200 share.

Breville’s net assets stayed largely stable at $297.9 million, down from $300.5 million in FY19.

Normalised return on equity edged 60 basis points (bps) lower to 22.1% for the year. Similarly, Breville’s full-year return on assets fell 110 bps to 13.0%.

The Breville share price will be an interesting one to watch this morning given the context of the result. Management was reasonably upbeat, citing strong topline growth and a “healthy” current business trajectory.

The company was wary of forecasting specifics into FY21 and FY22 given the “turbulence” caused by the coronavirus pandemic.

Breville continues to explore geographic expansion, with the Sage brand across Europe yielding strong net sales results. That brand is also now expanding to the Middle East, transitioning away from Breville in the region.

Foolish takeaway

Breville reported some strong headline numbers in this morning’s results. However, a “noisy” expense list with a number of impairments clearly ate into the company’s bottom line.

It will be interesting to see how the Breville share price trades early this morning following the full-year result.

Shares in the home appliance manufacturer have rocketed 54.5% higher this year while the S&P/ASX 200 Index (ASX: XJO) is down 8.4%.

More reading

• Flight Centre share price on watch after achieving cash flow target
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 drifts 0.1% lower, CBA reports solid FY20 result
• These ASX stocks could be the next reporting season heroes
• How the Santos share price could gain from COVID-19 stimulus

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Breville share price on watch as dividends climb 10.8% higher appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/33X9Pr4