Silk Logistics Holdings (SLH) H2 2024 earnings summary

Executive summary

• Revenue reached AUD 556.4 million, up 13.9% year-over-year, driven by organic growth and the Secon acquisition.

• Underlying EBITDA increased 11% to AUD 95.4 million, with an EBITDA margin of 17.2%.

• Statutory NPAT fell 54.8% to AUD 7.4 million, impacted by significant items related to M&A and restructuring.

• The Secon acquisition contributed AUD 59.5 million in revenue over 10 months and expanded operations to three new states.

• Strong cash generation and disciplined cost management supported resilience amid challenging economic conditions.

Financial highlights

• Underlying EBIT was AUD 34.8 million, slightly down from AUD 35.5 million due to higher depreciation and amortization.

• Underlying NPAT was AUD 11.5 million, and underlying EPS was 14.2c.

• Free cash flow conversion (post-capex) was 101.2% of underlying EBITDA after lease payments.

• Cash balance stood at AUD 27.1 million as of June 2024.

• Final dividend declared at AUD 0.0142 per share, annualized yield of approximately 3.1%.

Outlook and guidance

• Expectation of continued solid revenue and EBITDA growth in FY 2025, with a focus on organic growth, especially in bulk and fulfillment segments.

• Focus on new business wins, expanding share of customer wallet, and productivity gains via technology investment.

• Ongoing investment in recent acquisitions, especially bulk and fulfillment capabilities.

• Anticipated increase in lease costs by a few million AUD in FY 2025 due to market rate renewals.

• Management remains confident in recovering increased costs through customer contracts over time.