Ashley Services (ASX: ASH) aims to diversify revenue streams to high-margin segments

4 min read | February 09, 2024 11:39 AM AEDT | By Team Kalkine Media

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Ashley Services (ASX: ASH) aims to diversify revenue streams to high-margin segments — Image source: © Andreyyalansky19 | Megapixl.com

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Highlights

Ashley Services Group offers tailored workforce solutions including staffing training and requirements

In 1QFY24, the company recorded 10.69% YoY increase in revenue to AUD 141.80 million

Shrimpton (Ross John) has the maximum stake in ASH with a shareholding of around 55.76%

Established in 1986, Ashley Services Group Limited (ASX:ASH) is an ASX-listed firm that offers customized workforce solutions including staffing training and requirements. The company operates through the Labor Hire division and smaller and more focused training division.

The AUD 53.27 million market capitalization firm reported 10.69% YoY rise in its revenue to AUD 141.80 million in first quarter of the financial year 2024 (1QFY24), backed by a 32% increase in revenue recorded by the training segment and 10% increase by the labour-hire segment.

The reported period witnessed a 28.89% YoY fall in EBIT to AUD 3.20 million and 13% YoY decline in EBITDA. In 1QFY24, cash and cash equivalent grew by 65.52% YoY to AUD 4.80 million.

Top 10 shareholders of ASH

The top 10 shareholders of ASH have around 69.22% shareholding in the company, while the top four have 65.65% shareholding. Shrimpton (Ross John) and Richmond Hill Capital Pty. Ltd. have the highest stake in the company with a shareholding of 55.76% and 7.89%, respectively.

Recent business update

Through an ASX-update dated 8 January 2024, the company informed that Richmond Hill Capital Pty Ltd and its related entities have decreased their voting right in the company from 9% to 7.89% as of 5 January 2024.

On 9 November 2023, the company shared AGM meeting update. In AGM, the company highlighted its focus to maintain labour hire margins moving forward. The company highlighted its efforts to get in touch with its customers during contract renewals to ensure a 100% recovery from rising costs. Also, the company pointed towards its strategy to diversify revenue streams into higher-margin sectors.

Outlook

The company is committed to boost its revenue through its recently acquired OPW, Linc and indigenous affiliated entity firms that is expected to enhance underlying profitability. Moreover, the diversification strategy intends at tapping opportunities via higher-margin niches within portfolio.

The focus is on prioritizing customer services, undertaking technical advancements using AI tools and improving training divisions in the coming years.

Share performance of ASH

ASH shares closed 4.29% lower at AUD 0.335 apiece on 9 February 2024. In the past 12 months, ASH’s share price has decreased by almost 58%, and in the last six months, it has declined by 50.37%.

The 52-week high of ASH is AUD 0.83, recorded on 10 February 2023, while the 52-week low is AUD 0.335, recorded 14 December 2023.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 09 February 2024. The reference data in this report has been partly sourced from EODHD/Others.

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This article has been prepared by Kalkine Media, echoed on the website kalkinemedia.com/au and associated pages, based on the information obtained and collated from the subscription reports prepared by Kalkine Pty. Ltd. [ABN 34 154 808 312; AFSL no. 425376] on Kalkine.com.au (and associated pages). The principal purpose of the content is to provide factual information only for educational purposes. None of the content in this article, including any news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations, and video is or is intended to be, advisory in nature. The content does not contain or imply any recommendation or opinion intended to influence your financial decisions, including but not limited to, in respect of any particular security, transaction, or investment strategy, and must not be relied upon by you as such. The content is provided without any express or implied warranties of any kind. Kalkine Media, and its related bodies corporate, agents, and employees (Kalkine Group) cannot and do not warrant the accuracy, completeness, timeliness, merchantability, or fitness for a particular purpose of the content or the website, and to the extent permitted by law, Kalkine Group hereby disclaims any and all such express or implied warranties. Kalkine Group shall NOT be held liable for any investment or trading losses you may incur by using the information shared on our website.

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