Korvest shares hit record high on profit and dividend strength

Korvest shares are at record highs after the company turned in a solid profit result and boosted its final dividend, while the growth of data centres could provide further upside.

Korvest will pay an increased final dividend.

Korvest shares are trading at record highs after the company announced a strong profit result and upped its final dividend.

The Adelaide-based manufacturer posted revenues of $102.9m, down 4.3 per cent and a net profit of $11m, down 1.2 per cent but still close to a record, and upped its final dividend by 5c to 40c per share.

The company said its EzyStrut division supplied four major infrastructure projects during the year, with one of these ongoing and another secured project to start this financial year.

“The day to day and small project markets generally improved with NSW, Victoria and Western Australia achieving growth when compared to the prior year,’’ the company told the ASX.

“The input cost environment remains volatile with key costs such as steel and import freight remaining at relatively high levels despite fluctuations during the year.

“The ongoing high CPI has maintained pressure on staff costs as well as impacting leasing costs as most leases have an annual CPI rental adjustment.’’

Overall volumes in Korvest’s galvanising business were similar to the previous financial year, the company said.

“Profitability of the plant improved due to improved zinc consumption and more efficient use of labour.’’

Korvest said the outlook for the infrastructure sector remained buoyant and it also saw improving opportunities in the data centre market “and has enhanced its product offerings to service this growing market’’.

Korvest shares were 2.9 per cent higher at $9.93 on Monday.

The dividend will be paid on September 6 to shareholders registered on August 16.