BRG's trading update today says a lot about the value creation...

BRG's trading update today says a lot about the value creation attributes of the business and the resonance of the Breville brand:

FY12 EBITDA has come in at around $73m. That compares to $58m in FY11, so full-year growth of 25% at the EBITDA line (all of it purely organic)

However, the full-year numbers disguise just how potently the business is travelling at the moment.

Distilling these full-year EBITDA figures into half-year elements yields the following (note that December half is always the seasonably stronger period for the group):

DY10: $38.6m
JH11: $19.6m
DY11: $45.2m
JH12: $27.7m (implied by today's update)

The growth rates over prior corresponding periods is therefore:

DH11 vs DH10: 17%
JH12 vs JH11: 40%

So, significantly, growth has accelerated over the past 6 months. Amazingly, that acceleration has been achieved against the backdrop of a strenghtening Australian dollar [a signficant consideration given that more than half of BRG's sales are now offshore] and an environment of poor economic and consumer sentiment.

[It is my intention this reporting season to monitor which other company comes even remotely close to achieving 40% organic EBITDA growth...I'll make an early wager than none will.]

For added context, I note - with a degree of awe - that this company has doubled EBITDA and increased NPAT 2.4 times over the past three years.

And the most impressive thing has been that this has occurred purely organically and without any recourse to shareholders for funding.

In fact, quite the opposite: the balance sheet has gone from a net debt position of some $75m in December 2008 to a net cash position today of some $30m-odd today.

In other words, the underlying earnings base of the company has been more than doubled, the dividend payout ratio has increased at the same time, and still over $100m has reported to the balance sheet!

Very very few enterprises can boast that sort of outcome.

This is a unique company, and one that will create wealth for shareholders for many years to come, I believe.