Shares in tourism and public transport company Kelsian Group Ltd (ASX: KLS) hit a new 12-month high of $4.72 this morning, up more than 17%. This comes after the company posted a "solid" full year result and flagged an earnings uplift for the current year.
The Adelaide-based bus and ferry operator announced an underlying net profit after tax of $94.8 million, up 2.4% on the previous year. RBC Capital Markets analysts have dubbed it a "solid" result.
Kelsian's EBITDA came in at $285 million for the year, at the lower end of guidance, and the company will pay a fully-franked dividend of 9.5 cents per share, ahead of consensus estimates.
Kelsian chief executive Graeme Legh said it was a "solid FY25 result with growth in revenue, EBITDA, and EBIT achieved across all three divisions and geographies".
"The FY25 results were in line with expectations and were achieved despite ongoing cost pressures in an inflationary environment," Mr Legh said.
"During the period, all three divisions had solid operating performances and Kelsian's commitment to operational excellence, coupled with established market positions and a strong reputation, underpinned continued organic growth.
"Kelsian was awarded multiple contract renewals, contract expansions, and new contracts and importantly, many of these new or extended contracts will be executed with minimal additional capital investment."
Image source: Getty Images
Asset sale progressing well
Mr Legh said the sale process for a portfolio of tourism businesses in its Australian Marine and Tourism division, first flagged in April, was progressing well.
"Streamlining the operations will allow Kelsian to focus on its marine, bus and motorcoach transport businesses while lowering capital intensity and further increasing the predictability of the group's earnings base," the company told the ASX.
"Kelsian will continue to keep the market informed, in accordance with its continuous disclosure obligations, as the Tourism Portfolio divestment process progresses."
Where to from here for Kelsian earnings?
On the outlook, the company said it expected underlying EBITDA to be between $297 million and $310 million, up from $285 million for FY25.
"We have a clearly defined capital management strategy, a clear plan for the potential divestment of our Tourism Portfolio, and a disciplined growth focus," Mr Legh said.
"Supported by a strengthened balance sheet, I am confident in our ability to deliver sustainable long term shareholder value."
RBC analysts said the earnings result was neutral for the stock, and they had a price target of $3.50 on Kelsian.
Kelsian will pay a 9.5c per share final dividend on October 21, in line with last year's final dividend, to shareholders registered on September 15.
