More growth to come
RESULTS
Need To Know
- Strong FY23 result driven by organic and inorganic growth.
- FY24 guidance ahead of consensus. Expect upgrades.
- Acquisitions pipeline remains robust with the balance sheet in a position to support it.
Result Overview:
Revenue of $1,409.5m in-line with consensus.
NPATA of A$252m vs A$237m consensus (6% beat)
EPS of 24.5cps vs 23.1cps (~6% beat)
DPS 15.0 cps in-line.
Highlights
Strong result from Steadfast, follows the footsteps of its peers by delivering earnings at the top end of guidance. SDF is moving forward with its plan to acquire smaller domestic businesses (~A$280m of acquisitions expected for FY24).
The ~26.5% increase in Underlying EBITDA was driven by a ~13.6% increase in premiums and some volume uplift as well as acquisition growth of 12.9%.
Steadfast Network reported A$11bn in FY23 GWP which was up ~12.8% from FY22.
The balance sheet is well positioned. Gearing is ~19% and the group has A$378.5m of unutilised capacity to fund acquisitions (without exceeding the 30% gearing limit set by management).
FY24 Outlook (~3-4% above consensus):
EBITA A$500m - A$510m
NPAT A$230m - A$240m
EPS growth of 10% - 15%
NPATA A$277m - A$287m
Investment View
A strong result which was driven by both organic and inorganic growth. Outlook for FY24 appears positive with a clear growth pathway. The balance sheet capacity allows for the company to move forward with its acquisitions goals.
Re-affirm our Buy rating.
Stock Overview
Share Price
Company Overview
SDF is an Australian insurance company offering both business and personal insurance products through insurance brokerages and underwriting agencies.
Disclaimers and Disclosures
Issuer
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