Listed public company and major transport operator, K&S Corporation has announced strong results in its annual report released lat week, along with reporting some significant safety gains for the year.
The company revealed an underlying profit before tax of $42.1 million for the year ended 30 June 2024, which although it represents a decrease of 3.6 per cent on its 2023 results, while the company reported that its underlying profit after tax was $31.7 million, which was an increase of 3.4 per cent up on the corresponding 2023 result of $30.7 million.
Meantime K&S reported that its statutory profit before tax for the year ended 30 June 2024 was $41.3 million, a rise of 1.6% on its 23 result, while its statutory profit after tax was $31.2 million, 9.1% higher than the previous year statutory profit after tax of $28.6 million.
Included in the Group’s statutory result for FY2024 was a $0.7 million accounting loss attributable to the Group’s interest rate swap instrument.
The company’s operating revenues decreased by 2.9 per cent to $824.6 million ithis year, while its operating cash flow for FY2024 was $65.8 million, 35.2per cent lower than for the previous year.
The company said in its annual report that safety remains a key focus for it stating that the Group’s lost time injury rate reduced from 5.4 in FY2023 to 3.0 in the year just gone.
K&S said that the Australian transport segment provided another the financial performance in FY2024, with its operating divisions maintaining what it describes as ‘ strong cost and service focussed disciplines’ while continuing to progress detailed ‘end-to-end reviews of the operational parameters for a number of core activities and functions, that realised an improved margin compared to FY2023.
The company said that full year revenue for the Australian transport segment decreased from FY2023 to FY2024, which it said was in part due to it exiting several customer contracts, along with lower customer volumes and a reduction in fuel prices.
It said that despite ‘margin compression’, its New Zealand business recorded a sound result i on stable revenue.
It said that New Zealand’s economy entered into a recession in the course of FY2024, with a number of key customers realigning their business focus from the domestic to export market, adding that the Kiwi business continues to target the provision of integrated and value adding services and that it continues to review initiatives to further align with its key customer logistics functions.
The company said that the fuel trading business has provided strong financial results on stable revenues, while fuel retailing and wholesaling markets remained dynamic and continue to exhibit high levels of competition.
K&S said that its currently undertaking several projects to expand both its retail and wholesale offerings, including the redevelopment of several company owned sites and the purchase of new sites.
The Group said it has been impacted by supply chain interruptions, with the timeframes for delivery of new fleet substantially delayed for much of the year.
The Group added it works closely with its equipment suppliers for the procurement of new fleet assets and said that it has been diligent to investing in fleet renewal on an ongoing basis for a prolonged period prior to this.
It said that the Group had maintained a very strong balance sheet in FY2024, underpinned by sound trading performance and coupled with prudent capital disciplines.
The Group’s gearing ratio increased to 6.3 per cent as at 30 June 2024, compared to 0.1 per cent in the prior year while its net debt increased to $23.8 million up $400,000 on the prior comparative period.
The increase in debt levels was predominantly attributable to the acquisition of industrial properties in Townsville and Adelaide for a combined purchase price of $20.3 million (excluding GST) in the first quarter of FY2024. The Group is progressing plans to develop both of these sites into transport terminals within the next year. The construction of the new Adelaide transport terminal will facilitate the exit of two existing property leases, and realise operational synergies.
The Group acquired fixed assets totalling $70.4 million, compared to $68.7 million in the prior year and continues to invest to maintain a modern operating fleet.
Based upon independent valuations, the Group increased the carrying value of its freehold property portfolio by $39.8 million The Group has a substantial property portfolio consisting of high-quality industrial assets with a carrying value of $284.1 million.
In the second quarter of FY2024, the Group said it successfully extended the maturity profile of its debt facilities and negotiated improved terms with its existing panel of lenders, while debt facilities now comprise funding in four year tranches totalling $125 million, inclusive of a $35 million bank guarantee facility, maturing in September 2027 and five year tranches totalling $80 million maturing in September 2028.
