In my opinion, these three small cap companies are worth keeping an eye on at present.
Alliance Aviation Services Ltd (ASX: AQZ)
Recent financial results came in better than expected for this small cap mining services company engaged in FIFO transportation services.
Alliance Aviation offer ad-hoc charter services as well as FIFO deals through five key airports in proximity to mining and energy sector hotspots across Australia.
Alliance reported profit before tax of $26.1 million for FY18 – up 33% from FY17 – as net debt was reduced by $18.3 million to $52.4 million and total revenue jumped 23% to $248 million.
The company increased its total flying hours by 35% over the period, also declaring a full-year fully-franked dividend of 8.8c per share up 193% on FY17.
Alliance is seeing increased activity in all business sectors at present and is focused on increasing revenue through tourism sector growth with its wet-lease flying offerings proving significant of late.
Continued growth is expected through FY19 with sustaining capital expenditure for the year expected to increase to between $23 million and $25 million as additional aircraft are added to Alliance’s fleet.
Jumbo Interactive Ltd (ASX: JIN)
Shares in internet lottery business Jumbo Interactive are at a 52-week high today, up 1.3% to $7.82.
Jumbo has been a standout ASX performer in the last year, with its share price jumping up from $2.78 at this time last year with almost half a million active customers to its name.
Jumbo’s revenue from continuing operations in FY18 was close to $40 million – up 23% from FY17 – with a net profit of $11.8 million – up a whopping 55% from FY17.
Jumbo was certainly successful in increasing its margins in FY18 with EBIT expected to continue to grow through FY19 by between 44% and 46%.
If you’re tired of more traditional gambling shares like Tabcorp Holdings Limited (ASX: TAH) or Aristocrat Leisure Limited (ASX: ALL), Jumbo might be one you’d like, as it’s underpinned by a pretty impressive grasp on technology.
Specialty Fashion Group Ltd. (ASX: SFH)
Small cap women’s apparel retailer Specialty Fashion Group shares are up 3.6% to $1.43 at the time of writing, a 52-week high.
Specialty Fashion Group sold off several key brands to fellow small cap retailer Noni B Limited (ASX: NBL) earlier this year, retaining its City Chic brand after collecting $31 million in cash from the divestment.
Despite its inclining share price, non-executive director Michael Hardwick bought 100,000 shares in late September.
It’s usually a good sign when company insiders put their own money into the pot, especially when they’re already on a high.
These 3 stocks could be the next big movers in 2020
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