Greencross Limited (ASX:GXL) releases a trading update: Should you invest?

This morning Greencross Limited (ASX: GXL) will host its annual general meeting in Sydney. Ahead of the meeting the company has released its presentation which includes a trading update for the first 17 weeks of FY 2019.

Shareholders will no doubt be pleased to learn that the company has achieved solid like for like sales growth so far this year.

According to the release, Greencross has seen its revenue grow 7.6% during the period thanks to the combination of a 5.4% increase in like for like sales and the contribution of new stores.

The main driver of its like for like sales growth has been its retail operations. They are up 6.4% on the prior corresponding period.

One drag on its performance has been its standalone vet clinics. Like for like sales have fallen 1.8% for these clinics.

This compares to a 2.9% overall lift in vet clinic like for like sales thanks to solid performances from its in-store clinics. Which is great to see considering overall “vet market conditions remain challenging” according to management.

In addition to this, management provided an update on its cost savings initiatives. It advised that it continues to make progress with these initiatives, but it does not expect them to deliver incremental EBITDA in the first half due to a lower cost capitalisation and reinvestment in strategic initiatives.

Finally, during the period Greencross opened three new stores and two in-store clinics. It aims to open five new stores and ten in-store clinics in FY 2019.

Should you invest?

I thought that this was a positive update from Greencross.

While I wouldn’t class it as a must buy, I do think it could be worth considering and would suggest investors choose it ahead of National Veterinary Care Ltd (ASX: NVL) due to the diversification that its retail operations offer.

Alternatively, this growth star has been named as a share to buy in November.

OUR #1 dividend pick to grow your wealth now is revealed for FREE here!

You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!

Simply click here to grab your FREE copy of this up-to-the-minute research report on our #1 dividend share recommendation now.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Greencross Limited. The Motley Fool Australia owns shares of NATVETCARE FPO. 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.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…


The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!