Kelsian Group (KLS) H2 2024 earnings summary

Executive summary

• Achieved record FY24 results, driven by the first full-year contribution from AAAHI, new Sydney contracts, and improved margins in the Australian bus business, with over 367 million customer journeys, up 31% year-over-year.

• Portfolio includes leading positions in Australian bus, marine/tourism, and international bus, with 52% of revenue from Australian bus, 17% from marine/tourism, and 31% from international bus.

• Integration of AAAHI in the US exceeded expectations, with 100% contract renewal, organic expansion, and major contracts retained and extended.

• Transit Systems became the largest operator in Sydney after successful transition of new bus regions.

• 89% of FY24 revenue is from long-term, government-backed contracts, providing predictable, low-risk earnings and cash flows.

Financial highlights

• Revenue increased 42.2% year-over-year to $2,016.8 million, with underlying EBITDA up 63.9% to $265.4 million and margin rising to 13.2%.

• Underlying NPATA increased 32.3% to $92.6 million; EPSA rose 13.3% to $0.34.

• Statutory NPAT was $58.0 million, up from $21.0 million in FY23.

• Net operating cash flow reached a record $146.5 million, up 13.6% year-over-year, with cash conversion at 92.3%.

• Fully franked final dividend of 9.5 cents per share, full year 17.5 cents (up from 17.0 cents in FY23).

Outlook and guidance

• FY25 underlying EBITDA guidance of $283–295 million, with a second-half skew and further earnings growth expected.

• Full-year contributions expected from new Sydney contracts, Bankstown rail replacement, and ramp-up of US industrial contracts.

• CapEx for FY25 estimated at $180–190 million, with over half being one-off investments; CapEx expected to normalize to ~$100 million from FY26.

• Depreciation forecast at $117 million and interest at $59 million for FY25; effective tax rate estimated at 20–22%.

• Guidance assumes stable operating environment, tourism, labour, and input prices.