– By Caroline Falls –
SG Fleet led by Robbie Blau has done it again – reporting another double-digit profit climb for the half year. The vehicle salary packaging and fleet-services company has managed to post double-digit profit growth every six months since listing on the Australian stock exchange in 2015.
Net profit after tax rose 18.8 percent to $31.6 million in the six months ended December 31, compared with the same period a year earlier.
“The overall business performed well and demand for our products and services remains strong,” Blau said in a release to the stock exchange, citing healthy economic conditions in its major markets of Australia, New Zealand and the U.K. “Promisingly, interest in our mobility solutions has accelerated further.”
SG Fleet rolls all of its services, including asset management and finance for passenger vehicles, light and heavy commercial vehicles, and specialist plant and equipment, including materials handling equipment under the modern term mobility solutions. It’s also talking about pool car booking system, electronic log books and insurance and claims management and tailoring its Fleetintelligence telematics products to meet various client needs.
Other brands operated by SG Fleet include nlc and Motiva. SG Fleet said that demand has evolved to more bespoke, tech-assisted, integrated solutions, requiring a specialist provider.
“In addition to new client wins, we are getting increased traction with higher value-add technology-based solutions amongst existing corporate and government customers,” Blau said. “These customers are effectively increasing their overall spend on mobility services to access the cost savings we can generate for them.”
The first-half profit was on revenue of $154.2 million, up 15.4 percent from the previous corresponding period and made for 12.5 cents earnings per share, an increase of 17.3 percent. The board established a dividend reinvestment plan so that investors can elect to have their dividend entitlements converted to shares in lieu of cash. The dividend for the first half was declared at 8.78 cents, compared with 9.265 cents a year earlier.
Blau noted a couple of headwinds in his review of the results, particularly a tougher climate in the heavy vehicle asset management sector, where margins have narrowed. He said add-on insurance commissions had dipped.
Blau said the second-half typically yielded better results and that this trend was likely to continue. He pointed to expected strong activity in the corporate sector and an operation-wide efficiency drive for growing second-half profit.
“The pipeline of opportunities for our business remains healthy and we may see further improvement if the economic climate continues to become more positive.” Blau said he expected consolidation of services to be a feature of the industry in 2018 and that his group is actively exploring opportunities to build scale and grow, including establishing a relationship with CarAdvice, an independent vehicle comparison and review website.
