SG Fleet beats broker forecasts
Name: SG Fleet Group Limited (ASX:SGF)
Market Capitalisation: $900 million
Opening Share Price: $3.40
SG Fleet Group (ASX:SGF) has reported a fiscal 2018 profit of $67.7 million, up 13.6% on 2017.
This represented earnings per share of 26.4 cents, placing the company on a trailing price-earnings (PE) multiple of 12.9, a discount to the sector average of 17.
Management declared a final dividend of 9.95 cents per share, bringing the total dividend to 18.7 cents per share, up 11.5% on 2017.
The profit beat Bell Potter’s projections with the broker forecasting a net profit of $66 million.
The result was struck on revenue of $316.5 million, up 7.9% on the previous financial year.
Salary packaging and vehicle leasing
SG Fleet is a leading international mobility solutions provider with operations in Australia, New Zealand and the UK.
The company specialises in fleet management and leasing, as well as salary packaging services.
Growth in both profit and revenue was higher than fleet growth as a result of increased penetration of the company’s add-on products and services within its customer base and higher end of lease income.
One of the key features was the strong full year contribution from the UK business acquired in fiscal 2017.
The economic climate in the UK saw some improvement during the year and this was reflected in an uptick in interest in both tool-of-trade, particularly light commercials, and salary packaging services.
Growth in the current financial year is expected to come primarily from ongoing activities, supplemented by further product and services expansion.
Management noted that many of the products already brought to market are only in the early stages of adoption, and the take-up is now accelerating.
The group also highlighted that it had the head room for acquisitions should opportunities arise.
Note that any decision with regards to adding this stock to your portfolio should be taken with caution and professional financial advice sought.
Where to invest $1,000 right now
When the experts at Next Investors have a stock pick, it may pay to listen.
The Next Investors have been investing in ASX small cap stocks for years, with their best small cap picks yielding returns of 1,200%, 1,120%, 900% and 678%.
They have just revealed their hand-picked, FY2021 stock portfolio of high conviction long-term investments.
Click the link below to see what they are currently investing in.
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
Publishers Notice
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.
