Smartgroup Corporation Ltd
SIQ: XASX (AUS)
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
A$3.50 | Knn | Wcbmfryt |
Smartgroup Earnings: Drawbacks Remain Despite Expected Margin Improvements
No-moat Smartgroup’s underlying 2023 net profit after tax is slightly stronger than we expected, up 7% to AUD 63 million. This is despite margins being much weaker than we expected. Stronger revenue growth of 12% was held back by cost pressures, notably wage inflation, slow vehicle delivery times, and technology spending. Group EBITDA margin declined to 39% from 42%, contrasting with our expectation for margin expansion.