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Highlights

  • Transurban Group owns, operates and develops electronic toll road and intelligent transport system in North America and Australia
  • In 1HFY24, the company reported 310.4% increase in its net profit to AUD 230 million
  • In FY24, the company is expected to declare dividend of 62 cents per security, representing 7% rise over the previous fiscal

Transurban Group (ASX: TCL) is an ASX-listed toll operator which owns, manages and develops electronic toll roads and intelligent transport systems. Established in 1996, TCL specialises in toll road management, operation and development, particularly in Australia and North America.

In the first half of the financial year 2024 (1HFY24), revenue of the company jumped 4.5% YoY to AUD 2,125 million, backed by rise in toll, construction and other revenue during the reported period. In 1HFY24, gross distribution climbed 13.7% YoY to AUD 927 million, meanwhile profit surged by 310.4% YoY to AUD 230 million. The profit growth was driven by toll revenue growth and low finance cost.

Key drivers for the transportation sector

The data shared by the Australian Bureau of Statistics (ABS) indicates that population of Australia has increased by 2.5% to 26.8 million in the year through 30 September 203. During the reported period, natural growth in the population was 111,000, which is 3.9% lower than the previous year.

During the year ended 30 September 2023, net overseas migration reached 548,800 people. This reflects 60% growth in the net overseas migration.

Population of Australia is growing continuously, especially in major cities. This leads to increased demand for efficient transportation systems. Since, Australia is a key player in international trade, it is dependent significantly on transportation networks to allow the smooth movement of goods both internationally and domestically.

Population and migration data of Australia bodes well for the transportation sector.

Recent business update

On 13 March 2024, TCL followed its announcement dated 6 March 2024 and affirmed that it has achieved financial closure on it is issuance of EUR 500 million in senior secured 8-year notes and EUR 500 million in senior secured 12-year notes under the Euro medium term note campaign of the company.

Outlook

In FY24, the company expects to declare a dividend of 62 cents per security, 7% higher than the distribution announced the previous year.

The company shared that 495 Northern Extension is progressing steadily and nearly 29% of the project is accomplished and is expected to open in 2025.

Construction has commenced on the AUD 1.7 billion project which aims at expanding the M7 and establishing connections with the upcoming M12 Motorway.

Share performance of TCL

TCL shares closed 1.08% higher at AUD 13.14 apiece on 25 March 2024. Including today’s gain, TCL’s share price has decreased by 7.46% in the last one year and has reported a fall of 5.47% in the last three months.

The 52-week high of TCL is AUD 15.23, recorded on 27 April 2023, while the 52-week low is AUD 11.58, recorded on 26 October 2023.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 25 March 2024. The reference data in this report has been partly sourced from REFINITIV.