Reece shares slump after quarterly sales drop, weaker outlook
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The news: Plumbing supplier Reece has reported a drop in first quarter sales and flagged weaker earnings amid a softer trading environment.
The numbers: Group sales revenue was down 5% from a year ago to $2.23 billion. The company now expects adjusted earnings for the first half to be in the range of $300 million to $320 million, lower than the $367 million reported for the same period in FY24.
Shares in the company were down nearly 5% to $25.36 in early trading on the ASX.
The context: The group said sales revenue was flat in the main Australia and New Zealand market with underlying volumes softening. US sales revenue was down 6.5% reflecting lower volumes and deflation.
The company said a challenging trading environment has continued during the first quarter driven by ongoing softness in housing activity.
What they said: Reece chief executive Peter Wilson said: "As we look ahead, the lead indicators continue to be challenging in both regions. While the US has seen its first rate cut, this will take time to work through the system".
The source: ASX announcement
