OM Holdings (ASX:OMH) has reported net profit after tax (NPAT) has soared 231% to US$60 million for 1H 2022 despite facing headwinds over the period.
The manganese and silicon smelting company, which has vertical exposure in mining and trading, has released overall positive consolidated financial results for the half-year ended 30 June 2022.
The US$60 million NPAT for 1H2022 was considerably more than the US$18.1 million reported for 1H2021.
OM Holdings also reported earnings per share of 6.69 cents for 1H 2022 against 1.82 cents for 1H2021, while it enjoyed a 114.8% surge YoY in EBITDA to US$104.6 million versus US$48.7 million previously, and US$98.5 million in 2H2021.
While the company faced a period of lower product volumes being sold as compared to 1H 2021, gross profit margin increased to 27.7% in 1H2022 from 19% in the previous corresponding period.
The company’s total borrowings to equity ratio decreased from 0.67x as at 31 December 2021 to 0.54x as at 30 June 2022.
OM Holdings had US$82.8 million in cash at hand as of 30 June 2022, up slightly from US$81.5 million in 31 December 2021.
The group’s revenue amounted to US$466.7 million in 1H2022, representing a 35% increase over US$345.9 million.
OM Holdings reports that the overall strong financial performance has been supported by higher prices for manganese ores, ferrosilicon, and silicomanganese alloys, which have prevailed since Q4 2021.
The strong market environment experienced earlier this year has flowed through to the 1H2022
The strong market environment experienced earlier this year has flowed through to the 1H2022 reporting period due to prices being set 2-3 months in advance during a period of supply uncertainty in Q4 2021.
Commenting on the group’s 1H 2022 financial performance, Executive Chairman and Chief Executive Officer Low Ngee Tong said: “I would like to commend and thank all staff, especially our team on the ground in Sarawak, on delivering an outstanding set of results for the first 6-months of 2022.
Despite pandemic related workforce challenges and the fluid working environment in a year of furnace conversion and major maintenance, we have delivered operationally and the Group has been able to post very robust financial results.”
The company notes that over the years, it has significantly reduced its debt to equity ratio, from above 3x to the current level of 0.54x. It notes that refinancing the debt in the near term will create value by transiting out of a restrictive project finance structure, and will allow the company to target a moderate debt level and establish a sustainable dividend policy in the near future.
OM Holdings is engaged in the business of trading raw ores, smelting, and marketing of processed ferroalloys.
With over 25 years in the industry, OMH is listed on both the ASX and Bursa Malaysia and has operations across Australia, China, Malaysia, Singapore, and South Africa.
Today, the group is one of the world’s leading suppliers of manganese ores and ferroalloys and seeks to be the main ferroalloy supply partner to major steel mills and other industries.
