SG Fleet has reported its financial results for the year ending 30 June 2024, reflecting a year of steady performance across its corporate and novated leasing channels. The company navigated through a period marked by changing vehicle supply conditions, increased demand for electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs), and evolving fleet management needs.
Novated Leasing Demand and EV/PHEV Growth
Novated leasing remained a key growth area for SG Fleet, particularly with the rising interest in EVs and PHEVs. The Fringe Benefits Tax (FBT) exemption for electric vehicles contributed to the increasing attractiveness of novated leasing. As a result, SG Fleet’s novated fleet grew to 57,238 vehicles as of 30 June 2024, up from 50,355 in the previous year.
Demand for novated leasing extended across multiple vehicle types, with EV and PHEV models seeing strong uptake. This trend reflects broader market shifts towards low- and zero-emission vehicles, aligning with drivers’ growing interest in sustainability and emissions reduction.
Corporate Fleet Growth and Sale and Leaseback Activity
The corporate fleet sector also recorded growth, with the total corporate-funded fleet reaching 72,011 vehicles by the end of FY24, an increase from 70,690 vehicles in FY23. Sale and leaseback opportunities contributed to this growth, as businesses sought to access capital more efficiently in response to economic pressures.
SG Fleet reported a 39.4% increase in corporate-funded deliveries during the year, supported by high corporate confidence and rising outsourcing activity. The corporate-funded pipeline stood at 9,456 units as of 30 June 2024, indicating sustained demand despite a reduction from earlier peaks.
Easing of Order Pipeline and Vehicle Supply Normalisation
Throughout FY24, SG Fleet experienced gradual improvements in vehicle supply, allowing for a reduction in its order pipeline. Delays that had been caused by supply chain disruptions began to ease, particularly for high-demand fleet models, although some challenges remain. The company’s corporate order pipeline decreased by approximately 18% from June 2023 levels.
Novated leasing orders also saw a reduction, with the pipeline decreasing by 45% year-on-year to around 3,600 units. SG Fleet anticipates further normalisation of order backlogs over the coming financial periods, reflecting stabilising supply conditions.
Used Vehicle Prices and Market Adjustment
In the used vehicle market, prices have begun to normalise after reaching historically high levels during the pandemic. As of FY24, used vehicle prices were at 129% of pre-COVID levels, down from 144% in the previous year. The company expects further adjustment in used vehicle prices as the market continues to stabilise, particularly as new vehicle supply improves.
In addition, SG Fleet noted that vehicle price inflation contributed to a 7% increase in the average funded price of vehicles during the year.. This trend reflects the broader market reality of rising production and material costs in the automotive sector.
Financial Overview
SG Fleet reported total net revenue of $390.1 million for FY24, representing an 11.4% increase compared to FY23. This growth was driven by a 38.2% rise in funded new deliveries, helping to expand the company’s fleet under management, which stood at 277,553 vehicles at the end of the financial year.
The company’s net profit after tax (NPAT) was $89.7 million, a 6.7% increase from the previous year, with underlying NPAT growing by 19.2%. Earnings per share (EPS) also increased, with reported EPS rising 6.8% to 26.23 cents.
SG Fleet declared a total dividend of 33.93 cents per share for FY24, including a special dividend of 15 cents, representing a 109.6% increase from FY23
The total fleet under management is 277,553 as of 30 June 2024.
Outlook for FY25
Looking ahead, SG Fleet expects a continuation of the trends observed in FY24, with vehicle supply gradually returning to normal and the order pipeline stabilising. The company projects steady earnings for FY25, supported by ongoing demand in both the corporate and novated leasing channels.
SG Fleet is also forecasting that FY27 will mark a key period for corporate fleet customers to accelerate their transition to EVs, aligning with industry trends towards greater sustainability. The company is well-positioned to meet this demand, particularly through its focus on providing EV leasing solutions and expanding its product offerings in response to market needs.
SG Fleet’s FY24 results reflect a year of steady growth and adjustment in response to evolving market conditions. The company’s performance was supported by continued demand for novated leasing, particularly in the EV and PHEV segments, and an increase in corporate sale and leaseback opportunities.
