Half Year 2024 Service Stream Ltd Earnings Call Transcript
Key Points
- Service Stream Ltd (ASX:SSM) reported strong financial performance with double-digit growth in both earnings and profits.
- The company achieved significant improvements in cash flow, with operating cash flows of $70.1 million and an EBITDA to OCFBIT conversion rate of 111%.
- The utility division showed margin improvements, with EBITDA margins increasing from 3% to 3.4%.
- Service Stream Ltd (ASX:SSM) secured $1.2 billion of works over the first half, contributing to a strong work-in-hand balance of approximately $5.1 billion.
- The company announced a step-up in dividends to $0.02 per share, reflecting confidence in future performance and solid financial results.
- The Beaudesert project faced setbacks due to extreme weather, resulting in an additional provision of $9.8 million for repairs and extended project timelines.
- Despite improvements, the utility division still has legacy agreements that are not providing adequate returns, requiring further renegotiation.
- The transport division experienced a decline in revenue and EBITDA due to the demobilization of WA regional road operations.
- The company faces ongoing challenges in managing inflationary pressures and cost management.
- There is no formal dividend policy in place, which may create uncertainty for investors regarding future dividend payouts.
Hello, and welcome to the Service Stream fiscal year 2024 half-year results conference call. (Operator Instructions)
Please be advised that today's conference is being recorded.
It is now my pleasure to introduce Managing Director, Leigh Mackender.
Good morning, ladies and gentlemen, and welcome to Service Stream's FY24 half-year results presentation. As per the introduction, my name is Leigh Mackender, Managing Director of Service Stream, and I'm joined today by Linda Kow, our Chief Financial Officer.
So we are recording this session today via webcast. It's open to all registered Service Stream shareholders, and we have a number of institutional investors and analysts who joined us on the conference call, and are welcome to participate in the Q&A session at the conclusion of the presentation.
So in terms of agenda, I'll start by covering some group highlights, and provide an update on our operations. I'll then pass to Linda who will walk through the group's
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