Shares in plumbing supplies company Reece climbed sharply on Monday, rallying more than 10 per cent after its first-half earnings before interest and taxes (EBIT) exceeded market expectations. According to Citi analyst Samuel Seow, the company’s first-half EBIT of $262 million surpassed consensus estimates by approximately 5 per cent. Reece is a leading distributor of plumbing and bathroom products, serving trade, retail, and commercial customers. The company operates across Australia, New Zealand and the United States.
The earnings beat was primarily driven by effective cost management within its Australian operations. Australian sales aligned with forecasts, registering $2.06 billion. EBIT in Australia, however, exceeded expectations due to diligent cost control measures, despite a 7 per cent year-on-year decrease in absolute EBIT.
In the United States, Reece saw sales increase by 6 per cent to $US1.696 billion, largely attributed to a 7 per cent expansion in its store network to 286 locations. However, like-for-like sales experienced a slight decline. Furthermore, EBIT in the US fell by 26 per cent year-on-year, reflecting increased investment in the business.
Reece’s full-year 2026 EBIT guidance, set between $520 million and $540 million, sits approximately 5 per cent above consensus estimates. This outlook suggests a second-half performance mirroring the first, predominantly driven by ongoing cost management strategies implemented in Australia. Shares were last up 12 per cent.
