Somero Enterprises earnings fall despite record revenue

Concrete placement equipment specialist Somero Enterprises said in its final results on Wednesday that its sales had surpassed its record-setting revenue of 2021, which themselves had grown an impressive 50% over 2020.

The AIM-traded firm said revenue for 2022 totalled $133.6m, up from $133.3m year-on-year.

Despite that, Somero’s adjusted EBITDA decreased to $46m from $47.8m, due to the impact of strategic investments in personnel which it deemed necessary to drive long-term growth.

The company also reported that its cash flow from operations had been impacted by required investments in working capital.

It said it had to increase stock levels to support international markets and to offset supply chain shortages and delays.

The board announced a total ordinary dividend of 27.78 US cents per share for the year, down 10%, and a supplemental dividend of 7.7 cents, down 61% from its 2021 distribution.

“2022 was an outstanding year for Somero - the company reported record revenue, just surpassing the extraordinary levels we achieved in 2021,” said chief executive officer Jack Cooney.

“Europe and Australia made substantial contributions, each achieving their own record revenue totals.

“Notwithstanding the additional strategic investment and working capital made in the year, the company's operations were highly efficient in 2022, converting record sales into strong profits and operating cash flow providing the financial strength to make strategic investments and return substantial cash to shareholders.”

Cooney said the company remained committed to “disciplined” capital management, balancing short-term profits with reinvestment to drive long-term growth, adding that in 2022 it was “pleased” to have delivered strong profits while adding personnel in key global positions and completing the Houghton, Michigan facility expansion.

“On the basis of the investments we have made and the company's continued financial strength, we believe the company is positioned well to capture future growth from new products and in international markets for years to come.”

At 1114 GMT, shares in Somero Enterprises were down 3.96% at 382.24p.

Reporting by Josh White for Sharecast.com.