Here’s why the SeaLink (ASX:SLK) share price is shooting 17% higher

The SeaLink Travel Group Ltd (ASX:SLK) share price is shooting higher on Wednesday following the release of an impressive half year result…
The post Here’s why the SeaLink (ASX:SLK) share price is shooting 17% higher appeared first on The Motley Fool Australia. –

woman throwing arms up in celebration whilst looking at asx share price rise on laptop computer

The market may be sinking lower but that hasn’t stopped the SeaLink Travel Group Ltd (ASX: SLK) share price from racing to a record high today.

In afternoon trade the travel and transport company’s shares are up 14% to $8.03.

At one stage, the SeaLink share price was up as much as 17% to $8.25

Why is the SeaLink share price racing higher today?

Investors have been buying SeaLink shares today following the release of an impressive half year result.

For the six months ended 31 December, the company reported record revenue of $570.8 million. This was up a massive 329.5% on prior corresponding period.

A key driver of this growth was the transformational acquisition of the Transit Systems Group. That $635 million acquisition completed in January 2020 and therefore wasn’t included in the prior corresponding period.

On the bottom line, SeaLink delivered a 231.9% increase in underlying net profit after tax and before amortisation to $48.1 million.

However, due to the dilution caused by its capital raising, the company’s earnings per share grew by a slower (but rapid) rate of 100% to 14.6 cents.

This allowed the SeaLink board to declare a fully franked interim dividend of 7 cents per share, which is up 7.7% on the prior corresponding period.

Management commentary

SeaLink’s CEO, Clint Feuerherdt, feels that this result demonstrates the strength and resilience of the business through diversification.

He commented: “We were able to successfully navigate our way through this period by working closely with our state government clients, staff and customers. It was pleasing that all Australian bus operations and services continued at full scheduled timetables in all states during the period and this is reflected in the trading results.”

Mr Feuerherdt revealed that it was a similar story in the UK market. Pleasingly, the lockdown has not impacted its services.

“In London, the six-month period has been dominated by the context created by the continuing effects of COVID-19 in the United Kingdom, which ended the half-year with another national lockdown as a new strain of the virus emerged. Despite this, services continue to operate and operational performance is being maintained.”


While trading conditions remain challenging, management appears optimistic on the company’s prospects.

It said: “The future outlook for SeaLink is bright with our solid base of diversified businesses across Australia in the public bus, light rail and marine transport, tourism and accommodation sectors.”

It also notes that “some of the structural cost base changes and scheduling efficiencies that were pursued through the first COVID-19 impact period will remain and be an ongoing benefit to the business.”

Finally, SeaLink isn’t ruling out further acquisitions in the future.

It concluded: “We continue to review and pursue opportunities that enhance, leverage and complement our core strengths. Mergers and acquisition activity is a possibility as markets are constantly being evaluated.”

No guidance has been given for the full year but current trading results are slightly ahead of expectations.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Here’s why the SeaLink (ASX:SLK) share price is shooting 17% higher appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!