Kerry Stokes' conglomerate, Seven Group Holdings (ASX:SVW), can attribute its robust revenue and earnings growth of over 20% to the stellar performance of its industrial entities, namely WesTrac, Coates, and Boral, during the fiscal year ending on June 30.
The outcome notably reflects the substantial contribution of nearly a full year's performance from Boral, of which Seven Group Holdings owns a 69% stake. However, the company's directors have projected a deceleration in profit expansion for the 2024 financial year.
Despite this impressive growth that outpaced inflation, shareholders, including Kerry Stokes and his family, will receive an unaltered final dividend of 23 cents per share, along with a consistent 46 cents per share for the entire year.
"Adhering to our strategy of maintaining and progressively increasing dividends over time, Seven Group Holdings has chosen to maintain the final dividend at 23 cents per share, resulting in a total FY23 dividend of 46 cents per share with full franking," elucidated the company.
Directors attributed the robust performance to "customer activity in the resources, infrastructure, and construction sectors."
The company's ventures in the energy sector, Beach Energy, and the media realm with Seven West Media, reported lackluster to disappointing results for the first half of the year, alongside a minor impairment in the 39% stake of Seven West Media.
The group's trading revenue surged by 20% to reach $9.63 billion, paralleled by a 20% increase in EBIT to $1,187 million.
Underlying net after-tax profit observed an 18% climb, totaling $654 million, while statutory net after-tax profit experienced a significant 36% rise, reaching $604 million, primarily due to a mark-to-market impairment related to Seven West Media interests.
According to CEO Ryan Stokes, the "impressive outcome was primarily driven by the exceptional performance of our industrial enterprises, which collectively achieved growth exceeding 30% and generated over $1 billion in EBIT. This performance underscores the dominant market positions and the core-plus attributes of WesTrac, Coates, and Boral. The noteworthy 117% growth in Boral's earnings signifies substantial progress towards our performance enhancement objectives."
While the fiscal year 2022-23 yielded a commendable outcome, Seven Group anticipates a deceleration in 2024, projecting "high single-digit EBIT" growth. Following the 20% surge in EBIT during 2023, this suggests a growth range of approximately 7% to 9%, marking a significant slowdown in the pace of expansion.
