Kelsian Group Limited (ASX:KLS) Announces FY25 Half Year Results
Financial Performance
Kelsian Group Limited reported a 9.1% increase in revenue to $1,071.8 million for the six months ended 31 December 2024. Underlying EBITDA rose by 1.3% to $132.2 million, while underlying NPATA decreased by 7.9% to $39.7 million. Earnings per Share before Amortisation declined by 12.6% to 14.7 cents. The company maintained a fully franked interim dividend of 8.0 cents per share.
Operational Highlights
The Bankstown Rail Replacement service commenced successfully, delivered on time and on budget with 60 new buses and 140 drivers. Kelsian renewed the Bunbury & Busselton bus services contract, securing $100 million over ten years, and the Bustang contract with the Colorado Department of Transportation, securing up to US$26.5 million in the first year. Additionally, the Jersey contract in the Channel Islands was renewed, estimated at A$260 million over ten years, and ferry services contracts for Darwin were extended for five years.
Capital Management Framework
Kelsian unveiled its new capital management and allocation framework aimed at maximising shareholder returns and sustaining its portfolio. Targets include reducing leverage to between 2.0x and 2.5x by June 2026 and maintaining net sustaining capex at approximately $85 million from July 2025. The company also announced the sale of three bus depots in Western Australia, expected to realise proceeds of around $20.3 million.
Executive Comments
Managing Director & Group Chief Executive Officer, Clint Feuerherdt, stated, “The result reflects the strength of our diversified, global business with a strong track record of growth, underpinned by a majority of highly defensive long-term service contracts with high quality counterparties as well as cost base protection in most contracts.”
FY25 Outlook
The Board maintains its forecast for FY25 Underlying EBITDA to be between $283 million and $295 million, with a skew towards the second half of the fiscal year driven by rail replacement contracts and growth in industrial construction projects.
CEO Transition
Clint Feuerherdt will step down as Managing Director and Group CEO on 1 April 2025, transitioning to a part-time Strategic Adviser role. Graeme Legh, current AAAHI CEO, will succeed him as Group CEO, effective from 1 April 2025.
Motley Fool contributor Matt Burgess has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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