AMA Group’s Appendix 4C Quarterly Cash Flow and Activities Report for the quarter ended 31 December 2022 (unaudited) shows it with a cash balance of approximately $33.3 million and unused available finance facilities of approximately $1.2 million. The company used net cash from operating activities of approximately $5.1 million, including the impact of $5.4 million further investment in inventory build in the Supply business.
AMA noted an upward trend in underlying cashflows from Q1 (excluding corporate tax refund) to Q2 in line with expectations and reflecting recent pricing and network optimisation activities. “This is reflective of the FY 2023 transition year, and the Group is pleased to see the impacts of pricing activities and network optimisation beginning to flow,” said AMA.
The company also says it expects to satisfy its covenant testing requirements for 31 December 2022.
Q2 2023 volumes were in line with the previous comparative period, and approximately 11 per cent down on Q1 2023, as per the fewer working days in the quarter.
According to AMA, positive engagement with insurance partners continued, with new and/or extended contracts entered with a subset of insurers. Price discussions between AMA and insurer partners resulted in price increases outside the Capital S.M.A.R.T / Suncorp network interim pricing arrangements announced in November 2022, as the company works to ensure pricing alignment in the current inflationary environment.
Despite recent network optimisation activities resulting in the “rationalisation” of several sites, AMA says it is focused on expansion and growth into the future. As a result of leasing a new ACM Parts warehouse in Brisbane, the company will convert the existing warehouse in Arundel on the Gold Coast to a “best in class” repair centre.
Strategies to address the labour shortage continued with a focus on recruitment and retention. A targeted international recruitment drive resulted in more than 70 international hires during the quarter. Additionally, 44 new apprenticeships commenced, with approximately 350 apprentices engaged across the network.
AMA says its ACM Parts division set a record for daily parallel import sales in November 2022, building on the previous record set a month earlier. The aftermarket parts expansion continued, with sample direct import parts landing during the quarter and quality assurance processes commenced in advance of placing orders to expand supply.