Share of the Week: Grow your own

Friday 20th September 2002

Where so many have been mired down with expensive, messy acquisitions, Michael Hill International has cracked Australia with its recipe of disciplined, profitable organic growth and has set its sights on Canada and further afield.

The June-year result showed the tills were still ringing back home, where sales rose 18% and ebit (earnings before interest and tax) climbed 33%. The 77 Australian stores turned in sales of $A109 million, up 14%, and a 29% higher ebit of $A10.6 million.

The group return on shareholders' funds of 23.9% and a healthy equity ratio of 55% show patient expansion doesn't have to come at a cost.

And as Mr Hill and family still have their feet on a controlling shareholding MHI isn't likely to join the ranks of successful New Zealand companies snapped up by multinationals any time soon.

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