Victoria-based electricity and gas company Ausnet Services Ltd (ASX: AST) released its FY18 result on Monday, posting net profit after tax up 14% on the previous year to $291 million.
All key financial metrics improved: EBITDA grew 6% to $1.14 billion, and cash flow from operations increased nearly 20% to $886 million.
Ausnet’s main source of revenue, electricity distribution, performed well, with earnings up 15% thanks to higher customer contributions and lower operating costs.
The company refocused its commercial energy services division, which provides metering and energy data solutions to the utility and infrastructure sectors, moving away from low-margin maintenance services. This resulted in a 7% decline in the segment’s revenue, but ensured a 29% EBITDA margin, up 9% on FY17.
On the downside, the electricity transmission and gas distribution divisions saw a marginal decline in earnings.
The result failed to impress investors, and the stock closed 1% down to $1.72.
However, it was enough for the company to increase its total dividend by 5% to 9.25 cents per share. For FY19, Ausnet expects to increase its dividend to 9.72 cents per share, franked between 40% and 50%, resulting in a grossed up dividend yield of around 6.7% at the current share price.
These 3 stocks could be the next big movers in 2020
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.
*Returns as of 6/8/2020
Motley Fool contributor Tommaso Autorino has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
- Why the Freelancer Ltd (ASX:FLN) share price dropped 16% today – July 31, 2018 3:05pm
- The Syrah Resources Ltd (ASX:SYR) share price falls 7% on guidance downgrade – July 30, 2018 1:01pm
- AMP Limited (ASX:AMP) shares slide to new multi-year low on earnings downgrade – July 29, 2018 6:44pm