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Group Sales: Up 6% to $4.6 billion. Group Like-for-Like Sales: Flat. EBITDA: Declined 6% to $448 million. EBIT: Declined 14% to $262 million. Return on Capital Ratio: Down 222 basis points to 10.8%. Dividend: Declared at $0.44 per share. ANZ Sales Revenue: Up 4% to $2.1 billion. ANZ EBITDA: Declined 4% to $261 million. ANZ EBIT Margin: 8.7%, down 106 basis points. US Sales: Up 6% to USD $1.7 billion. US Like-for-Like Sales: Declined by low single-digits. US EBITDA: Down 9%. US EBIT: Declined 26% to USD $55 million. Net Operating Cash Inflows: $199 million. CapEx to Sales Ratio: 1.8%. Share Buyback: $401 million deployed. Gross Interest Expense: $31 million for the half year. Net Debt Position: Increased to $1 billion. Networking Capital to Sales Ratio: 20%, up 1% since June 30.

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Release Date: February 22, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Group sales increased by 6% to $4.6 billion, supported by network expansion. Reece Ltd added 19 new branches in the US, expanding their presence to 286 branches. The company continues to invest in digital tools and innovation to enhance customer experience and operational efficiency. Reece Ltd is focused on long-term growth, with a strategic emphasis on operational excellence, innovation, and profitable growth. The company maintains a strong balance sheet with a conservative net leverage ratio, providing capacity for future growth.

Negative Points

EBITDA declined by 6% to $448 million, and EBIT fell by 14% to $262 million, reflecting softer earnings. The group's return on capital ratio decreased by 222 basis points to 10.8%, impacted by softer earnings and ongoing investments. The US residential new construction sector remains weak, particularly in the regions where Reece Ltd operates. Operational expenditure is experiencing inflationary pressures, particularly in labor, IT, and property costs. The company faces competitive dynamics and headwinds in both the ANZ and US markets, affecting performance.

Q & A Highlights

Q: Can you provide insights into the competitive environment in ANZ and how Reece Ltd plans to maintain its market position? A: Peter Wilson, Executive Chairman and CEO, emphasized focusing on internal strategies and capabilities to withstand market pressures. He highlighted the importance of embedding and leveraging AI across the business as a significant challenge and opportunity for future growth.

Story Continues

Q: How is Reece Ltd performing in the US market, particularly in the new construction sector? A: Peter Wilson noted that the US residential new construction sector remains soft due to affordability issues, particularly with mortgage rates. However, the company's growth is driven by its strategy of organic store rollouts, which has been a key factor in maintaining performance despite market challenges.

Q: What are the cost management strategies in place for the ANZ region, and how are they impacting margins? A: Andrew Young, CFO, mentioned ongoing inflationary pressures in ANZ but highlighted efforts to manage costs through tight control of FTE and discretionary spending. The focus remains on balancing cost management with necessary investments in the business.

Q: Can you elaborate on the US store rollout strategy and its impact on the business? A: Sasha Nikolic, Group President and Managing Director, stated that the company aims for a sustainable rate of 10 to 15 new stores per year in the US. The recent acceleration in store openings was opportunistic, and the company is focused on ensuring these new branches mature effectively.

Q: How is Reece Ltd addressing digital innovation and its role in competitive strategy? A: Peter Wilson highlighted the company's ongoing digital transformation efforts, which began in 2016. The focus is on digitizing customer experiences and leveraging AI to enhance business operations. This digital strategy is seen as crucial for maintaining a competitive edge in both ANZ and the US markets.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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