Sealink share price jumps higher after delivering strong profit growth in FY 2020

Sealink Travel Group Ltd (ASX: SLK) share price is jumping higher today following its FY 2020 results release…

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In morning trade the Sealink Travel Group Ltd (ASX: SLK) share price is storming higher following its full year results release.

At the time of writing the tourism and transport company’s shares are up 6% to $4.71.

How did SeaLink perform in FY 2020?

It certainly was an eventful year for SeaLink in FY 2020 as it battled the tough trading conditions caused by the pandemic and integrated its transformational $635 million acquisition of Transit Systems Group. The latter completed in mid-January, contributing approximately five and a half months of trading to this result.

For the 12 months ended 30 June 2020, SeaLink delivered a 152.8% increase in total revenue to $646.5 million. This comprises Australian Bus revenue of $277.1 million, International Bus revenue of $132.6 million, and Marine & Tourism revenue of $213.9 million.

On the bottom line, the company posted underlying net profit after tax and before amortisation of $37.2 million, up 47.2% on the prior year. Though, on a statutory basis, the company declared a loss after tax of $13.5 million. This was driven mostly by non-cash and one-off items. These include $12.4 million of COVID-19 related impacts.

Despite this, the company has declared a fully franked final dividend of 4.5 cents per share. This brings its full year dividend to 11 cents per share.

Outlook.

SeaLink’s CEO, Clint Feuerherdt, is positive on the company’s outlook.

He commented: “The successful acquisition and integration of the Transit System Group during the 2020 financial year has transformed SeaLink into an integrated, resilient, international multi-modal transport business.”

“Approximately 87% of SeaLink’s revenue is currently contracted to mostly large government clients and we are proud to have renewed and expanded many of these operating contracts, a testament to our focus on providing safe, efficient, convenient and sustainable travel,” he added.

The chief executive concluded: “The outlook for the Group continues to be positive. A strong pipeline of bus contracting opportunities is being pursued, our tourism assets are unique and attractive to domestic travellers and our balance sheet strength positions us to take advantage of opportunities that are coming to market.”

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