- Seven Group’s full year underlying earnings before interest and tax (EBIT) exceeded guidance at $496.9 million, up 67%.
- The company says the result reflects the strength of product support demand from the mining production cycle, continued East Coast infrastructure investment and Beach Energy’s performance.
- Guidance for 2019 is for underlying EBIT to be up 25% on 2018.
Kerry Stokes’ Seven Group posted a 830.1% increase in full year net profit after tax to $413.9 million, mostly due to demand for equipment, parts and services from the mining industry and infrastructure activity.
Revenue was up 40.6% to $3.2 billion.
And underlying EBIT (earnings before interest and tax) was up 67% to $496.9 million, beating the company’s own guidance of $470 million.
At the close, Seven shares were 8.7% to $22.06.
The company says the result reflects the strength of product support demand from the mining production cycle, continued East Coast infrastructure activity and Beach Energy’s performance.
WesTrac, the Caterpillar equipment dealer, increased EBIT by 23% to $202.7 million.
Underlying EBIT in the energy group was $71.8 million, up from $25.7 million.
Net debt increased by $728 million to $2.03 billion, mainly due to $487.8 million Coates Hire acquisition, a $117.5 million investment in Beach Energy, and the recognition of $1.03 billion of Coates Hire net debt.
Cash coming in during the year included $535.3 million from the sale of WesTrac China and a share placement of $385.5 million.
CEO Ryan Stokes, son of the chairman, billionaire Kerry Stokes, says the year has been transformative for Seven.
“Our relentless focus continues to be on driving further operational performance through harnessing our people, systems and technology to provide the best products and services to our customers,” he says.
The company declared a fully franked final dividend of 21 cents a share, taking the total shareholder payout to 42 cents.
Seven expects 2019 underlying EBIT to be up 25% on the current year.
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