What’s behind Saunders International’s (ASX:SND) growth momentum?

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What’s behind Saunders International’s (ASX:SND) growth momentum?

 What’s behind Saunders International’s (ASX:SND) growth momentum?
Image source: © Ipopba|Megapixl.com

Highlights

  • Saunders International recently made an all-time high of AU$1.395 on the ASX.
  • The Group boasts robust financials with a significant rise in its EPS from FY19 to FY22.
  • Saunders has a robust balance sheet and financial capacity to assist with the delivery of a strong orderbook and leverage a strong pipeline of opportunities.
  • Saunders’ FY22 revenue is expected in the range of AU$115-$130 million with EBIT of 6.5% to 7.5%.

Investors keep tabs on a wide range of financial parameters before investing in a particular company. Among all these factors, key parameters like growing revenue & profits, earnings per share (EPS), and the future outlook of the company/projects play a pivotal role.

Interesting read: Here’s why Saunders International (ASX:SND) is up over 55% in last six months  

Saunders International Limited (ASX:SND) is one such company whose share price scaled new heights recently, making a fresh all-time high of AU$1.395.

The multi-disciplinary group provides engineering, construction and maintenance services to a wide range of industries, including mining, energy, infrastructure, defence, oil & gas and water.

With over 70 years of experience, the Group continues to support Australian industrial developments through its innovative and cost-effective solutions.

Saunders’ robust financial performance

Undoubtedly, the financial health of a company is paramount to investors and Saunders is performing well on this front.

The data from the last three financial years indicates a decent performance. The company’s EPS has gone up from 0 in H1 FY19 to 0.51 cents per share in H1 FY20. The latest data for H1 FY22 reflects an EPS of 2.69 cents per share, which is five-times the FY20 figure.

Related read: Why Saunders International (ASX:SND) is in box seat to reap benefits of buoyant oil market   

A similar pattern could be seen in the company’s revenue and EBITDA growth. Saunders’ H1 FY19 revenue and EBITDA stood at AU$28.09 million and AU$0.31 million, respectively. During the last half-year period ended 31 December 2021, revenue grew to AU$46.29 million while EBIDTA reached AU$5.15 million

Image source: Company update, 24 February 2022

The Group’s NPAT or net profit after tax was AU$2.802 million during H FY22, 3.28% higher than the previous corresponding period.

SND is a profit-making company with a significant cash balance of AU$30.537 at the end of the first half-year period of FY22.

Related read: Saunders International (ASX:SND) strengthens NSW foothold, wins $17M in infra projects

Saunders’ outlook looks positive

Saunders International has a strong order book with projects worth AU$223 million at the end of 31 December 2021. The Group has also managed to secure a preferred contractor status for projects valued at AU$190 million, which are still in the tendering process.

During the H1 FY22 period, the Group was awarded a design and construction contract for 11 jet fuels tank for the US Defence facility in the Darwin region. The contract is worth AU$165 million and the work has already commenced.

The Group also maintains a strong market position for the projects under the Boosting Australian Diesel Storge Program.

Saunders has given revenue guidance of AU$115-130 million for FY22, while its EBIT is forecast to remain in the range of 6.5% to 7.5%.

Related read: What is powering Saunders’ (ASX:SND) bullish outlook for 2022 and beyond?

Share price movement: SND shares traded at AU$1.10 apiece on 25 May 2022. In the last one year, SND has yielded a handsome return of over 44%.

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