Kelsian Group (KLS) H1 2025 earnings summary

Executive summary

• Revenue rose 9.1% year-over-year to $1,071.8 million, driven by new contracts, indexation benefits, and growth in Australian Bus, AAAHI, and Marine & Tourism segments.

• Underlying EBITDA increased 1.3% to $132.2 million, with a second half earnings skew expected due to contract ramp-ups and seasonality.

• Underlying NPATA declined 7.9% to $39.7 million, impacted by higher depreciation, interest, and operational challenges.

• Statutory NPAT was $20.1 million, down from $28.1 million in the prior year period.

• Interim dividend maintained at 8.0 cents per share; capital management and allocation framework completed with clear targets.

Financial highlights

• Revenue increased by 9.1% year-over-year to $1,071.8 million, reflecting new contracts and fare increases.

• Underlying EBITDA was $132.2 million, up 1.3% year-over-year; margin declined to 12.3% from 13.3% due to contract mix and cost pressures.

• NPATA was $39.7 million, down 7.9% year-over-year; statutory NPAT was $20.1 million.

• Cash conversion was strong at 93%, with gross operating cash flow of $108.7 million.

• Net operating cash flow was $65.9 million; net investing cash outflow of $112.7 million, mainly for fleet and infrastructure.

Outlook and guidance

• Full-year FY25 underlying EBITDA guidance reiterated at $283–295 million, assuming stable operating conditions.

• Second half expected to be stronger due to full-period contract contributions, efficiency projects, and seasonality.

• FY25 capex guidance unchanged at ~$185 million; sustaining capex in FY26 expected to be below $85 million.

• Leverage forecast to fall below 2.5x by end FY26 as earnings grow and capex moderates.

• Portfolio review ongoing to improve returns, simplify the portfolio, and accelerate debt reduction.