Lindsay Australia reports uplifts in revenue, profits

Lindsay Australia announces new CEO.

Diversified network and service offerings has allowed Lindsay Australia to mitigate the effects of adverse weather and rising cost pressures.

The integrated transport, logistics and rural supply company announced its financial results for the half-year ended 31 December 2022, noting uplifts in revenue, profit and dividends as it capitalised on favourable market conditions.

Half-year revenues of $337.4 million signalled an increase of $63.5 million (+23.2 per cent) compared to the prior comparable period (pcp), leading to the growth of 36.2 per cent in underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to $42.8 million.

The strong revenue growth and favourable market conditions also boosted underlying profit before tax (PBT) by $9.7 million (+64.5%) from H1 FY22 to $24.6 million.

Lindsay Australia’s robust financial results have enabled the Board to declare an interim unfranked dividend of 1.9 cents per ordinary share, payable on 14 April 2023 to shareholders with a record date of 31 March 2023.

In a statement Lindsay Australia said it remained committed to its status as a leading essential services provider and a critical link within Australia’s food and agriculture sectors, delivering long-term value for its people, customers, community and shareholders.

“The group continues to deliver strong year-on-year growth, despite headwinds from unfavourable weather, labour shortages and cost pressures,” said Kim Lindsay, Lindsay Australia CEO.

“This highlights the successful implementation of Lindsay’s strategic objectives, the robustness of the group’s integrated and diverse business model and the dedication of our employees.

“Demand remains strong in transport, but we expect some softening of demand in the rural segment in H2 FY23 due to unfavourable weather.

“We are positioned well to continue to grow through greenfield expansions and strategic acquisitions in both the transport and rural sides of the business.

Lindsay said the group remained focused on diversifying its services and footprint to mitigate seasonality and weather risks to continue to deliver sustainable returns and value to stakeholders.

“Our outlook remains positive for the year and the company remains on track to deliver FY23 underlying EBITDA in the range of $68 million – $71 million,” he said.

The performance of all divisions surpassed their prior year’s results, demonstrating the successful execution of Lindsay’s strategic goals and the resilience of its integrated and diversified business model.

The company’s ongoing investments in strategic assets and disciplined capital allocation continue to deliver sustainable returns.

H1 FY23 capital expenditure of $21.3 million delivered 27 new refrigerated rail containers, 25 prime movers, 12 trailer sets, and other plant and equipment.

In H2 FY23, Lindsay Australia plans to make further capital investment of approximately $34.3 million, including investment in road transport equipment and facilities.

Transport’s revenue increased by $58.5 million (+29.9 per cent from the pcp) to $253.9 million, driven by a combination of organic expansion in the road and rail segments (+10.1 per cent and +11.2 per cent, respectively) and disciplined diesel price fluctuation recoveries.

The division achieved underlying EBITDA of $48.3 million, a rise of $13.5 million (+38.8 per cent) from the pcp, aided by the impacts of industry consolidation and equipment shortages.

The hybrid logistics model (road/rail) and diverse geographic footprint continue to support long-term value creation.

Rural generated moderate revenue growth of $4.6 million (+5.6 per cent from pcp) to $87.0 million, with a larger and more effective sales team driving market share expansion, offsetting headwinds from unfavourable weather conditions.

Rural’s underlying EBITDA of $5.1 million was on par with the pcp. The division is exploring new markets to expand its geographical reach and continues to assess strategic M&A options.

The company said it was committed to delivering more sustainable outcomes across its operating divisions.

“Lindsay has engaged experienced sustainability consultants to develop a customised sustainability strategy and ESG roadmap, focusing on meaningful initiatives to deliver positive outcomes,” the company said in a statement.

“The Company has started to install solar power generation capacity across several key sites and is exploring the electrification of equipment where possible.”

In related news, Lindsay Australia is on the look out for a new chief executive officer.

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