– By Caroline Falls –
SG Fleet, one of four Australian Stock Exchange listed fleet services companies, continued its expansion, growing at a rate of nearly 14 percent thanks to healthy economies in its three major geographies — Australia, New Zealand and the United Kingdom.
Profit grew 13.6 percent to $67.7 million in the year ended June 30, according to company reports filed with the Australian Stock Exchange.
SG Fleet CEO Robbie Blau cited cross selling of products and services among their growing customer base, particularly in Australia, corporate and government contract wins in New Zealand and a smooth takeover in the UK of Motiva by Fleet Hire.
“The main theme of the year across all geographies has been the continued growth in the products and services we provide to our customers,” said Blau in a press release.
Among other highlights of the report are: revenue increased 7.9 percent to $316.5 million, earnings per share rose 11.9 percent to 26.38 cents, and a fully franked final dividend of 9.958 cents took the final year payout to 18.738 cents per share, or some 11.5 percent more than the year earlier.
The second half was better than the first half and Blau attributed that to strong contributions from a UK acquisition and from NZ.
In Australia, a poor retail environment, lower new car sales, and regulatory changes stifled growth, said Blau in a statement, adding, “The lowering of commissions on extended warranty products, in line with regulatory reviews, impacted performance in the novated segment.”
More on novated leasing, Blau said that lacklustre consumer sentiment crimped lease take-up.
“Encouragingly, the sale of accessories to novated drivers has been buoyant. In addition, we rolled out our well-established car buying and disposal services to both individual drivers and the wider employee base of our customers,” he said.
Another down point was an impact from the end of local car manufacturing. Blau blamed it for a backlog in new vehicles acquisitions, especially among fleet customers with ‘buy local’ policies. That effect flowed through to accessories, delaying their uptake and slowing sales.
A feature of the report on UK activities highlighted the hot topic low-emission vehicles has become there.
“We are currently working with a major national utility company to raise awareness and promote electric vehicles, providing us with a great opportunity to benefit from their strong brand presence and get our own brand in front of a wider audience,” Blau said.
Sounds like great experience to be shared in Australia as it embarks on the same path.
Blau said the company is well place to grow through acquisitions and its own recently established ‘innovation hub’, which has already incubated new products.
