Prestal Holdings' Half Year ending 31 December 2023 results

Prestal Holdings Limited (ASX: $PTL) has reported its Half Year ending 31 December 2023 results, following the completion of the sale of its Consumer Products business. The company's sales revenue from continuing operations decreased by 15.7% to $16.8m, with underlying EBITDA down 6.4% to $3.4m and underlying NPAT down 4.1% to $2.1m. The company also announced a healthy cash balance of $62.1m as at 31 December 2023, of which $52.8m will be returned to shareholders through a combination of capital return and fully franked dividends.

Executive Commentary on H1'24 Financial and Operational Highlights

The reduction in sales revenue was primarily driven by reduced spending in the B2C segment due to the overall decline in consumer discretionary spending across Australia. However, the company managed to improve the EBITDA margin to 20.1% through cost-saving initiatives. The introduction of new hamper offerings and the implementation of a new CRM system are expected to assist in improving customer insights and increasing sales outreach capacity. The company remains focused on increasing revenues outside of the Christmas period by targeting other annual events with carefully curated premium product offerings.

Summary of Prestal Holdings' Outlook and Capital Management

Prestal Holdings remains positive about the outlook for the Hampers with Bite (HWB) business despite the challenging economic conditions. The company aims to revamp its brand image and visual identity to allow for year-round gifting, develop new products for both B2B and B2C channels, update the website to improve the shopping experience, and explore additional strategically suitable acquisition opportunities. The Board intends to return $52.8m of capital to shareholders through a fully franked special dividend, a capital return subject to a favorable tax ruling, and an additional fully franked special dividend. The company continues to liaise with the Australian Taxation Office to reach a private tax ruling on the proposed capital return of $0.18 per share.