ARB Corp down ~15% on disappointing Profit numbers
ARB Corporation (ARB) who sells aftermarket 4WD and off-road vehicle accessories such as bull bars, suspension systems and touring equipment in Australia and internationally is experiencing a torrid Tuesday, falling ~20% on the open before recovering some of the losses into lunchtime. The 1H numbers:
- Sales revenue of $358mn, -1% YoY, less than 3% below analyst estimates of $367.8mn.
- Dividend of 34c fully franked beat Bloomberg consensus estimates of 30c.
- Net Income of $42.2mn was -17% YoY.
Last month ARB flagged a material decline in earnings, discussed by MM Here. Hence the market was already prepared for bad news but the 17% drop in net income has seen sellers panic, as has been the way during the current reporting season.
However, while new vehicle 4WD sales are down on last year and they’ve suffered from fitment constraints, we feel todays move is an overreaction for a company with a healthy order book and daily sales order intake close to historical highs.
