Seven Group Holdings Limited (ASX: SVW) held its Annual General Meeting on 21 November 2018, following which the share price of the company decreased by 6.205 percent. While addressing the shareholders of the company the Executive Chairman Mr. Kerry Stokes highlighted that in the last five years, the Group’s industrial services operations have adjusted their respective business models to meet the changing dynamics of the market. He informed that the company’s investment into Energy has created substantial value for the shareholders. And, the management of the company is confident that its position in Beach will generate further growth as the company supports the east coast gas market.
He also informed that the SWM team have responded positively with a renewed focus on improving their core business with stronger TV ratings, revenue and cost savings. Due to these initiatives, the SWM’s net debt is reduced by $90 million, and it is targeted to be less than two times EBITDA in FY19. SWM is dominating the television sector, and it has been the number one TV network for the last 12 years.
The company’s Managing Director & CEO Mr. Ryan Stokes also addressed the Shareholders at AGM. While addressing the shareholders Mr. Stokes highlighted that the company delivered a total shareholder return of 81 percent in FY18, ranking second against the ASX 100 for the year, fifth over three years, and seventh over five years. He informed that the strategic objective of the company is to maximize return to shareholders through long-term sustainable value creation. While talking about the safety issues, he highlighted that in FY 2018 the company experienced some deterioration in the lost-time injury frequency rate.
While providing an overview of the initiatives that company has taken, Mr. Ryan informed that through the sale of WesTrac China at an attractive point in the cycle, the company was able to complete the acquisition of Coates Hire and increase the investment in Beach Energy, thereby capitalizing on the level of infrastructure activity and gas demand on the East Coast. He also informed that the company has taken opportunities in capital market to enhance an already strong balance sheet through a $385 million equity raising, $350 million convertible notes issue, refinancing the corporate syndicated facility, and most recently, successfully converting the $496 million TELYS4 shares to ordinary shares.
In FY 2018, the company earned an EBIT of $497 million from continuing operations which was up 32 percent on a pro-forma basis and ahead of guidance. In FY 2018 the underlying earnings per share increased by 70 percent to 97 cents. The company has reaffirmed the group’s FY19 guidance, according to which the FY19 underlying EBIT is expected to be approximately 25 percent above FY18 on a continuing operations basis.
In the last six months, the share price of the company decreased by 17.52 Percent as on 20 November 2018. SVW’s shares traded at $15.495 with a market capitalization of circa $5.61 billion as on 21 November 2018 (AEST 3:54 PM).
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