On Thursday the S&P/ASX 200 Index (ASX: XJO) was back on form and surged higher. The benchmark index rose 0.8% to 6,834 points.

Will the market be able to build on this on Friday? Here are five things to watch:

ASX 200 to give back its gains

The Australian share market looks set to end the week on a disappointing note after a selloff on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open 70 points or 1% lower this morning. In late trade in the United States, the Dow Jones has fallen 1.5%, the S&P 500 is down 2.1%, and the Nasdaq index has sunk 3%. The latter could be bad news for Aussie tech shares today.

Afterpay to return?

The Afterpay Ltd (ASX: APT) share price could return from its trading halt this morning. The payments company requested the halt so it could undertake a $1.25 billion notes offering to fund the buyback of equity in its Afterpay US business and support its growth. However, according to the AFR, the company successfully raised $1.5 billion from investors on Thursday night. Though, given the tech selloff on Wall Street, it might be worth the company staying in its halt until after the weekend.

Oil prices soften

Energy producers such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) will be on watch after oil prices softened. According to Bloomberg, the WTI crude oil price is down 0.15% to US$63.12 a barrel and the Brent crude oil price has fallen 0.5% to US$66.69 a barrel. This appears to be due to profit taking by traders after oil prices hit a 13-month high.

Kogan half year results

The Kogan.com Ltd (ASX: KGN) share price will be one to watch on Friday when it releases its half year results. While many aspects of the result have been pre-released, important metrics such as its net profit are still unknown by the market. Last month Kogan advised that first half gross sales grew by more than 96% and adjusted EBITDA increased more than 175%.

Gold price falls again

Gold miners including Evolution Mining Ltd (ASX: EVN) and St Barbara Ltd (ASX: SBM) could come under pressure today after the gold price tumbled lower again. According to CNBC, the spot gold price has fallen 1.3% to US$1,774.20 an ounce. Rising US treasury yields continue to weigh on demand for the precious metal.

More reading

• ASX 200 rises 0.8%, A2 Milk sinks, Zip drops
• WPP Aunz (ASX:WPP) share price dips on 32% profit drop
• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn
• Sandfire (ASX:SFR) share price hits year high on profit result and supercycle hopes
• Afterpay (ASX:APT) delivers more explosive growth and launches $1.25bn notes offering

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Wagners Holding Company Ltd (ASX: WGN) share price jumped 8% yesterday after reporting its FY21 half-year result.

Wagners is a diversified Australian construction materials and services provider. It produces cement, concrete, aggregates and composite products. It offers a ‘Earth friendly concrete’ product and it also provides transport services, precast concrete and reinforcing steel.

What did Wagners report in the FY21 half-year result?

The building products business reported that total revenue increased by 26.9% to $155.8 million. Wagners said that revenue increased due to improved transport, quarry, concrete and cement sales.

There was a 15% increase in crossarm sales offset by lower activity in pedestrian infrastructure, mainly due to COVID-19 delays.

Gross profit went up by 30.9% to $88.1 million. Most types of expenses increased for Wagners in line with increased business activity.

The earnings before interest, tax, depreciation and amortisation (EBITDA) of Wagners more than doubled, rising by 116% to $18.6 million. EBIT soared 415% to $10.3 million.

The EBIT margin improved by 4.1 percentage points to 10.6% in the construction materials and services division, whilst new generation building materials saw a 3.7 percentage points increase in the EBIT margin to 8.8%.

There was an improvement of net profit after tax (NPAT) of $6.2 million, leading to a bottom line profit of $6.1 million.

Wagners reported that it generated $32.4 million of pro forma cash flow from operations, up $43.2 million from the prior corresponding period.

Net debt improved by $21.9 million to $61.1 million, which was helped by the improved operational cashflow from better business performance.

Growth plans

It has invested in automation in Australia and increased capacity for its crossarm production facilities to achieve higher productivity and lower cost of production of the new generation building materials. There has been no growth in the USA with the impact of COVID-19, but the pultrusion machine has arrived in USA and it’s also pursuing opportunities with manufacturing from Australia.

Wagners boasted that there has been around 20,000 tonnes of CO2 emissions saved by using Wagners low carbon concreate technology Earth friendly concrete (EFC). it said there is increased demand in UK and Europe. The global regulatory focus on CO2 emissions provides a perfect platform for EFC, according to management.

The company said that there was a significant increase of sales of cement in the first half of FY21, with the market outlook looking promising. Wagners is also expecting increased demand in FY21 for concrete with the commencement of infrastructure projects.

More reading

• 5 things to watch on the ASX 200 on Friday
• ASX 200 rises 0.8%, A2 Milk sinks, Zip drops
• Healthia (ASX:HLA) share price on watch after 78% profit growth
• Marley Spoon (ASX:MMM) share price on watch after delivering rapid revenue growth
• Why the Droneshield (ASX:DRO) share price will be on watch tomorrow

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) rose by around 0.8% today to 6,834 points.

Reporting season is nearly over, but there has been a flurry of results today.

Here are some of the highlights:

A2 Milk Company Ltd (ASX: A2M)

The A2 Milk share price dropped 16% today after reporting its FY21 half-year result.

The ASX 200 company revealed that its total revenue was down 16% to NZ$677.4 million and the earnings before interest, tax, depreciation and amortisation (EBITDA) declined 32.2% to NZ$178.5 million. The EBITDA margin dropped to 26.4%.

A2 Milk said that the daigou channel continues to see COVID-19 disruptions, which is causing a flow-on impact to the cross-border e-commerce channel (CBEC). It is taking steps to reactivate these channels.

Infant nutrition revenue in Australia and New Zealand declined 40.5% to $209.5 million in the half.

The infant formula business said that it generated strong performance in the China label infant nutrition division, with revenue growth of 45.2%. This was an increase in the market share value to 2.4%. Its distribution increased to 22,000 Chinese mother and baby stores (MBS) in the period.

Australian liquid milk saw 16.3% revenue growth and a record market share of 11.7%.

USA revenue saw 22.3% growth with distribution rising to 22,300 stores. The company’s agreement with Agrifoods in Canada is seeing steady distribution expansion after starting in Western Canada.

The pace of the recovery is slower than previously expected and it now expects revenue to be at the lower end of the previous guidance range.

Revenue is now expected to be in the order of NZ$1.4 billion and the EBITDA margin is expected to be between 24% to 26%. This outlook assumes actions taken to re-activate the daigou channel are successful and deliver significant improvement quarter on quarter.

Zip Co Ltd (ASX: Z1P)

The Zip share price was another of the worst performers in the ASX 200 after revealing its FY21 half-year report.

Zip revealed that it generated record revenue of $160 million, which was growth of 130% year on year. The revenue growth was made possible thanks to total transaction volume (TTV) growth of 141% year on year to $2.32 billion – this was annualising at $7.5 billion at December 2020.

The buy now, pay later business reported that it made positive cash earnings before tax, depreciation and amortisation (EBTDA), with cash gross profit margins increasing to 54%. It boasted that it is demonstrating market leading unit economics whilst investing for global growth.

Zip said that it now has more than 5.7 million active customers, which was an increase of 217% compared to the prior corresponding period. It also has more than 38,500 merchants across the US, Australia, New Zealand and the UK.

Some of the latest clients that Zip has won include Gamestop, Fanatics, Newegg and Sunglass Hut in the US, as well as Harvey Norman Holdings Limited (ASX: HVN), Domayne and Adore Beauty Group Ltd (ASX: ABY) in Australia.

During the six-month period, a number of investments were made in the buy now, pay later space across Europe and the Middle East. The Canadian project is currently in the pilot stage and scheduled for a soft launch in the second half of FY21.

Afterpay Ltd (ASX: APT)

One ASX 200 business that didn’t see any share price movement was Afterpay.

It went into a trading halt to announce a $1.25 billion convertible notes offering to take up a larger ownership of Afterpay US.

Afterpay also announced its FY21 half-year result.

Its underlying sales went up by 106% to $9.8 billion, driving Afterpay income higher by 108%.

The number of active customers that Afterpay has increased by 80% to 13.1 million and the number of active merchants went up by 73% to 74,700. North American customers grew 80% to more than 8 million.

Afterpay disclosed that its gross loss as a percentage of underlying sales improved from 1% to 0.7%. Its net transaction margin jumped 110% to $213.9 million.

The buy now, pay later business saw underlying EBITDA soar 521% to $47.9 million.

Afterpay finished the period with $460.5 million of cash. It said it had pro forma liquidity and growth capacity of more than $1.7 billion.

More reading

• Why the Zip (ASX:Z1P) share price is sinking 10% today
• WPP Aunz (ASX:WPP) share price dips on 32% profit drop
• Why a2 Milk, Service Stream, TPG, & Zip shares are tumbling lower
• Why the a2 Milk (ASX:A2M) share price is crashing 20% to a multi-year low
• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Healthia Ltd (ASX: HLA) share price will be on watch tomorrow after the healthcare business announced strong growth in its FY21 half-year result.

What did Healthia announce?

Healthia revealed that its customer revenue increased by 38.9% to $61.5 million. This revenue growth was supported by organic revenue growth of 14.5%.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) grew 90.7% to $11 million. The underlying EBITDA margin increased by 486 basis points to 17.87%.

Underlying net profit after tax plus amortisation of customer list intangibles (NPATA) jumped 85.5% to $4.7 million. The underlying NPATA margin increased 194 basis points to 7.72%.

The underlying earnings per share (EPS) grew 78.2% to 6.86 cents. The Healthia board of directors decided to declare an interim fully franked dividend of 2 cents per share.

Management said that this result is testament to the ongoing dedication and resilience of its clinicians and support staff. Healthia said the result was also reflective of the essential nature of the allied health services that its businesses and people provide to their local communities.

The company said that as it integrates its new ‘eyes and ears’ division, settled in November 2020, into its allied health network it will attempt to generate growth from cross-referrals between Healthia’s three disciplines to promote better patient outcomes.

Recent Healthia share price movements

The Healthia share price has gone up by 33% over the last 12 months, despite the COVID-19  pandemic. Since the end of October 2020, Healthia shares have actually risen by 60%.

Outlook

Healthia said it will continue to focus on four areas: patient focused outcomes, organic growth, future accretive acquisitions and vertically integrated business units.

It has a few different strategies to generate ongoing organic growth. It said it will continue to invest in industry-leading education, tools and support for clinicians, as well as developing industry-leading career opportunities for all team members. This is expected to continue to drive strong organic growth into the future.

Other organic growth strategies could be to further enhance its centralised support functions to clinical teams, finding additional opportunities to co-locate services, introducing services into existing locations and working on new ways to engage its teams.

Healthia said that the acquisition of The Optical Company and the addition of optometry increases its total addressable revenue market from $6.5 billion to $9.8 billion. That breaks down to $2.7 billion in feet and ankles, $3.8 billion in bodies and minds and $3.3 billion in eyes and ears, with the parent company haing a market share of less than 1.5%.

The company said that with its low market share, and the fragmented nature of the target allied health industries it operates, acquisitions will continue to be a central pillar of the growth strategy.

Healthia expects to deploy a minimum of $20 million per annum into new allied health acquisitions. These are expected to be funded from a combination of bank debt, free cash flow and clinic class shares.

More reading

• 2 growing small cap ASX shares to buy
• Here’s why the Healthia (ASX:HLA) share price is racing higher

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended HEALTHIA FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Marley Spoon AG (ASX: MMM) share price will be one to watch on Friday.

This follows the release of the subscription-based meal kit provider’s full year results after the market close.

How did Marley Spoon perform in FY 2020?

For the 12 months ended 31 December, Marley Spoon reported a 96% increase in revenue to 254 million euros.

While this was driven by strong revenue growth across all geographies, the star of the show was its US business. It reported a 126% increase in revenue to 127 million euros thanks to growth across all brands.

Positively, despite operational headwinds related to the COVID-19 pandemic, the US business was able to increase its contribution margin by 6 percentage points. This led to the business turning profitable on an operating EBITDA basis.

Supporting its growth was its Australia business, which delivered a 76% increase in revenue to 86 million euros, and its Europe business, which grew revenue by 66% to 41 million euros.

This ultimately led to the company reporting a contribution margin of 26% and an operating loss of 0.5 million euros for FY 2020. The latter was a big improvement on its 29.8 million operating loss a year earlier. Furthermore, the company achieved an operating profit of 1.5 million euros for the second half, which bodes well for FY 2021.

At the end of the period, Marley Spoon had 227,431 subscribers. This was up 83% on FY 2019’s subscriber numbers.

Management commentary

Marley Spoon’s CEO, Fabian Siegel, commented: “2020 was a significant year for Marley Spoon. We doubled revenue in a challenging operational environment and invested in the foundations for future growth.”

“We continue to see opportunities to invest in new customer growth at attractive unit economics. These marketing investments, combined with our investments in expanding manufacturing capacity, developing our digital technology platform, and further strengthening our leadership team, position us well for the coming years. We are encouraged by the continued adoption of online grocery shopping by consumers, a trend we are well-poised to capitalise on given the strength of our direct-to-consumer engagement capabilities.”

Outlook

Due to the continued strong global growth in online meal kit adoption and retention of customers acquired in FY 2020, Marley Spoon expects to grow revenue between 25% to 30% in FY 2021.

It is also expecting its contribution margin to improve to between 30% to 31%.

Mr Siegel noted: “We have started FY2021 strong in all markets, with the US continuing to be our biggest growth engine. We demonstrated improved unit economics in FY2020 which reflects the accelerated shift to online shopping as a result of the pandemic. This trend is continuing, and we see opportunities to continue to attract new customers at a faster pace.”

More reading

• Why the Marley Spoon (ASX:MMM) share price is one to watch today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Droneshield Ltd (ASX: DRO) share price will be on watch tomorrow after the counter-drone equipment maker released its full-year results for FY20 after the market closed.

At the close, Droneshield was flat for the day at 17 cents per share. But it will certainly be interesting to see how the market reacts to the results on Friday morning.

Results indicate growth

Droneshield notched up another record year for revenue in FY20. Customer receipts and research and development (R&D) amounted to a total of $5.4 million in revenue. This equates to a 58% rise in overall revenue compared to FY19.

The company was quick to note that its customers continue to grow in depth and quality. Notably, customers now include the US Air Force, the Australian Department of Defence, and the New Zealand Defence Force.

Droneshield chair Peter James also remarked in the 2020 annual report that a large portion of the revenue was derived from high-quality ‘blue-chip’ customers. This includes contracts with government agencies of the Five Eyes community.

The counter-drone company also advised that its high-conviction sales pipeline remained strong at $100 million in active contract discussions. While the total sales opportunities have grown to $200 million.

Additionally, Droneshield reported a strong cash position after the company raised $17 million in late 2020. Borrowings also remain at a low amount, with $107,000 at the end of December.

Lastly, Droneshield’s net loss after tax reduced to $5.87 million, down from $7.70 million in 2019.

Future outlook hazy

With $35 million in R&D since the company’s inception, Droneshield continues to invest in broadening its product and solutions offering. More recently, it has produced software that communicated with Droneshield’s other products. The software provides alerts and visual monitoring to customers.

Droneshield is attempting to expand its software-as-a-service (SaaS) offering through products such as these, which would provide more reliable and steady revenue.

Other than the $100 million high conviction pipeline, there wasn’t much more information provided on Droneshield’s near-future outlook. This is likely due to the lumpy nature of the company’s product sales.

Droneshield share price snapshot

The Droneshield share price has returned a total of 0% over the past 12 months. That’s right – if you invested a year ago, you are right where you started.

Keep in mind that the company has also carried out capital raises which dilutes the share price. Therefore, even though the share price is the same, the company’s total market value has increased.

Based on today’s Droneshield share price, the company’s market capitalisation is now $66.3 million.

More reading

• Why the DroneShield (ASX:DRO) share price is lifting 6%
• Why the DroneShield (ASX:DRO) share price is climbing higher

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Liberty Financial Group Pty Ltd (ASX: LFG) share price finished off 1.23% up at $8.20 a share today after the non-bank lender released its half-year results.

Liberty Group is a diversified finance company that held its initial public offering (IPO) debut on the ASX in December 2020. Its businesses include residential and commercial mortgages, motor vehicle finance, personal loans, business loans, broking services, general insurance and investments.

Here’s what we learned from the company’s financial results for the period ended 31 December 2020 (HY21).

Liberty Financial share price pops after strong results

Liberty Financial reported an HY21 statutory net profit after tax (NPAT) of $83 million compared to its HY20 NPAT of $74 million.

As at 31 December 2020, the group had financial assets under management totalling $12.0 billion. This is slightly higher than the $11.7 billion reported for 30 June 2020.

Liberty Financial held $672.4 million in cash at the end of the period, which compares to $484.9 million at the end of HY20.

Executive commentary 

Liberty Financial reported a reduction in customers impacted by the coronavirus pandemic to 2% of the portfolio as at 31 December 2020. This compares to 10% at 30 June 2020. 

Commenting on the current business environment, chief executive officer James Boyle said:

Liberty’s customers have shown tremendous resilience during the pandemic. Notwithstanding the improved financial position of our customers, economic and social uncertainty continues which means we remain cautious about our FY21 results.

Liberty’s chief financial officer Peter Riedel added:

LFG’s capital and liquidity position remains in a strong position to support our existing customers and continuing to grow with only a modest increase in overall leverage ratio to 13.4x. Standard and Poor’s also affirmed Liberty’s investment grade corporate rating as BBB- (stable) and LFG issued three securitisations 2020 totalling $2.3b in the second half of 2020.

Since its IPO in December, the Liberty Group share price is up 17% and is trading 8.6% higher year to date.

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Motley Fool contributor Gretchen Kennedy has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Bikeexchange Ltd Fully Paid Ord. Shrs (ASX: BEX) share price stormed higher in late trade today as the company released its half-yearly report.

The BikeExchange share price closed 6.67% higher today at 24 cents.

What did BikeExchange report?

BikeExchange, which only listed on the ASX earlier this month, reported revenue of $2.005 million for H1 Fy21.

The company reported a loss of $79,100 for the half-year ending 31 December 2020, a drop from the $165,522 profit achieved for the same period in 2019. The company attributed the loss largely to initial public offering (IPO) costs.

BikeExchange advised that operations progressed well during the period as the company raised $20 million in new capital.

Furthermore, trading in the second half of FY21 has started well with January e-commerce transactions showing strong growth on the prior corresponding period (pcp). Overall the group expects the second half of FY21 to demonstrate meaningful total transaction value and revenue growth on that recorded by the BikeExchange Group for the first half of FY21.

The subscription revenue run rate was positive entering the third quarter with increases across retailer sign-ups providing an increasing contribution. In the coming half, the group expects to interact closely with its retail and brand customer base. This will assist and enable them further with consumer engagement and organic growth.

Outlook

Looking ahead, BikeExchange expects continued strong growth in e-commerce. The company is also looking to improve its conversion and commission rates with a boost from increased marketing.

Also aiding to growth, revitalised media partnerships are expected to contribute uplift to media revenues from the 4th quarter of FY21. BikeExchange also noted that there will be new products launching in the next financial year.

About the BikeExchange share price

BikeExchange is an online global marketplace exclusively dealing with bikes and all things related. Operating in 8 countries, the marketplace aims to provide an efficient, technology-driven platform to connect consumers with retailers of bicycle products and accessories.

Since listing on 9 February this year, the BikeExchange share price has lost 7.69%, falling from 26 to 24 cents.

More reading

• Bikeexchange (ASX:BEX) CEO Mark Watkin on the risks and opportunities ahead
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Motley Fool contributor Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Real Energy Corporation Ltd (ASX: RLE) share price is storming higher today as the company announced an update regarding its future. Shares in the company were trading 26.51% higher at close today. Taking the Real Energy share price to 11 cents.

Pure Hydrogen transition

Real Energy today announced it would be undertaking a merger with Strata-X Energy CDI (ASX: SXA). The anticipated completion date of the merger is March 9, with the new ticker code expected to be ‘PH2’.

The directors of both companies decided to change the name to Pure Hydrogen to better reflect its goal of becoming a large hydrogen business. Notably, the company has already progressed on several fronts in developing its hydrogen division. Nonetheless, natural gas remains a significant focus for Pure Hydrogen and the company plans to continue to pursue its development and production. The company is also investigating natural gas to hydrogen as one of its potential hydrogen manufacturing initiatives.

Projects underway

Pure Hydrogen, through its subsidiaries, is now progressing five hydrogen projects. Located across Queensland, Victoria, and NSW. All hubs are being identified as prime locations for Pure Hydrogen’s expansion into cutting-edge hydrogen manufacturing and fuel-cell technology.

Moreover, the new company is also advancing potential ‘turn key’ technology and engaging distribution logistics experts. Further updates in this regard will be provided by the company as soon as these agreements are finalised.

As well as hydrogen the the new company will continue to aim to add value through natural gas. As such, on this front it maintains three projects. Two located in Queensland with one being housed overseas in Botswana. However it must be noted that the Pure Hydrogen’s Botswana project is currently being farmed out in exchange for funding. When the project is completed it will retain a 51% working interest in the project. During 2021, 3 to 6 test wells are planned within Pure Hydrogen’s high grade coal seam gas areas.

More reading

• Why the BikeExchange (ASX:BEX) share price is up 7%
• Why the MotorCycle Holdings (ASX:MTO) share price is racing higher
• Tinybeans (ASX:TNY) share price will be on watch tomorrow, here’s why!
• Why the Cash Converters (ASX:CCV) share price slid lower today
• Clean TeQ (ASX:CLQ) share price nosedives 8% on $10 million loss

Motley Fool contributor Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The MotorCycle Holdings Ltd (ASX: MTO) share price went up more than 6% after the company released its FY21 half-year result.

This business was founded in 1989. It is a motorcycle dealership and accessories group with 48 franchises operated from 31 dealership and eight retail accessory locations in Queensland, New South Wales, Victoria and the ACT.

MotorCycle Holdings FY21 half-year result

The company revealed that it sold 11,467 motorcycle units, which is 12% more than it did in the prior corresponding period, with new motorcycle unit sales increasing by 30% to 6,770.

MotorCycle Holdings said that motorcycle sales grew as an outcome of introducing new products into existing stores and the dealership network expansion. The overall national market of new motorcycle sales increased by approximately 20%. The company grew its market share, securing approximately 12.1% of national new bike sales during the financial year, compared with 11.1% in the prior year.

Used motorcycle sales decreased 6% to 4,697 units due to tightening stock availability. However, the sales value increased 5% and improved margins generated a gross profit increase of 30% compared to the prior corresponding period.

Online accessory sales grew by 75% with major projects underway to improve e-commerce systems to generate further growth.

Retail accessories and parts revenue grew by 19% and servicing and repair revenue went up by 33%. Retail finance, insurance and mechanical protection plan income increased 6%.

Wholesale accessory sales rose by 23% with divisional gross profit rising 30% and demand is expected to remain high in the second half. Stock supply has been subdued but is gradually improving and margins are expected to increase as benefits of a lower US dollar are realised.

The increase in unit sales led to revenue rising 23% to $218.4 million. Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 168% to $26.8 million. The underlying EBITDA margin more than doubled, rising from 5.6% last year to 12.3% in this half-year.

MotorCycle Holdings grew net profit after tax (NPAT) by 256% to $17.2 million.  

Did MotorCycle Holdings pay a dividend?

The company announced that it would pay an interim dividend of 10 cents per share.

The $47.6 million bank debt at 30 June 2020 has been reduced to $0. It has $7.4 million of cash on hand.

How much has the MotorCycle Holdings share price recovered from COVID-19?

Over the last 12 month the MotorCycle Holdings share price has risen by 54%, which includes the COVID-19 crash. However, since the start of 2021 the MotorCycle Holdings share price has dropped a little.

CEO commentary on the outlook

MotorCycle Holdings CEO David Ahmet said that the half-year results reflected the continuing increased market demand for recreation and leisure products, new franchises and expanded product ranges, lower overheads and a disciplined approach to ongoing expenses resulting in margin growth. Mr Ahmet said:

Our growth strategy of expanding the business by adding new ranges and products to existing sites without increasing our cost base is delivering sustainable growth and profit.

The Harley-Davidson dealerships are performing above expectations and the Indian Motorcycles and Polaris products added to existing stores contributed strongly to the results.

The CEO also said that after paying down debt, it’s now in the position to make acquisitions if the opportunity is there.

It’s expecting increased market demand and strong trading conditions to continue for the rest of the financial year.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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