The Citadel Group Limited

26% rise in NPAT in FY 18: The Citadel Group Limited’s (ASX: CGL) stock has risen 16.83% in three months as on August 20, 2018 as the company for FY 18 delivered 26% rise in NPAT to $19.4 million. EBITDA for 2018 grew 13.0% to $34.0 million, driven by the quality of Citadel’s delivery and synergies from acquired solutions. In FY 18, there has been 9.8% increase in revenue to $108.5 million due to increase in scale of contracts and new contracts were won across all verticals. The company has $24.9 million in cash, and has a net cash position of $7.1 million. Further, the company has raised the final dividend by 12.5% to 9.0 cents per share, fully franked (FY17: 8.0cps, 100% franked). The total dividend increased by 7.8% to 13.8 cents per share, fully franked. In FY 19, CGL plans to double the level of the R&D investment in business-critical software, big data/knowledge management and digital solutions, for long term growth. The company also plan to take advantage of M&A opportunities to complement the organic growth strategy. In addition, there is significant pipeline for citizen-centric national security and incident management digital platform, with first client commencing in H1 FY19. On the other hand, CGL has appointed Mrs Jenny Martin to the roles of Chief Financial Officer (CFO) and Joint Company Secretary, effective from 20 August 2018. Meanwhile, CGL stock is trading at a P/E of 19.79x. Based on the foregoing, we give a “Buy” recommendation on the stock at the current price of $ 7.29.
 

FY 18 Financial Performance (Source: Company Reports)
 

Helloworld Travel Limited

Robust Performance in FY 18: Helloworld Travel Limited’s (ASX: HLO) stock surged 9.9% on August 21, 2018 after the company for FY 18 reported 48.1% growth in the profit after tax to $32.0 million compared with the prior year. In 2018, there is 3.5% growth in TTV on the back of strong transaction volume growth and business acquisitions, partially offset by lower average airfares. Revenue in 2018 is in line with the prior year due to the benefits of business acquisitions in second half of FY18 which is offset by disposed operations and restructured Insider Journeys business. There is also an improvement of 3% in 2018 EBITDA margin to 20.0%. In 2018, the operating costs were down significantly than the prior year due to the Group’s focus on cost reduction initiatives and has reduced costs from the disposed operations. The lower costs were partially offset by the inclusion of the cost base of the recent business acquisitions. The company has declared final dividend of 11.0 cents per share, which brought the total dividends for FY18 to 18.0 cents per share fully franked, a rise of 28.6% compared with the prior year. Additionally, for FY 19, HLO expects EBITDA to be in the range of $76.0 million to $80.0 million. The forecast is subject to no material and unexpected deterioration in operating conditions or material unforeseen adverse events. As a result, HLO stock has risen 3.80% in three months as on August 20, 2018 but is trading at a P/E of 20.44x. As of now, we give an “Expensive” recommendation on the stock at the current price of $ 5.100, which is close to the 52-week high level.
 

Half yearly trend (Source: Company reports)
 

Bank of Queensland Limited

Decent growth in cash earnings in 1H 2018: Bank of Queensland Limited’s (ASX: BOQ) stock has risen 7.74% in three months as on August 20, 2018 after the company for the 1H 2018 has reported 4% growth in cash earnings after tax to $182 million and 8% rise in statutory net profit after tax to $174 million. Further in the 1H 2018, the lending growth improved as the bank witnessed total lending growth of $671 million in 1H18, which is more than $800 million compared to the contraction of $157 million in 1H17. The bank has maintained its strong capital position as the CET1 ratio was up 3 basis points over the 1H 2017 to 9.42 per cent. On the other hand, BOQ has planned the sale of St Andrew’s Insurance to Freedom Insurance Group. Meanwhile, BOQ stock is trading at a P/E of 11.89x. Based on the foregoing, we give a “Hold” recommendation on the stock at the current price of $ 11.090, while the full year result is due.
 

CSL Limited

2018 Profit Growth ahead of the company’s guidance: CSL Limited’s (ASX: CSL) stock has risen 17.40% in three months as on August 20, 2018 after the company for FY 18 reported 29% growth in the reported net profit after tax to $1,729 million, which is marginally ahead of the company’s guidance. The company has delivered 2018 revenue growth of 11% at CC to $7,915 million, Cashflow from Operations (CFO) is up 53% to $1,902 million and has raised the total full year dividend by 26% to $1.72 per share. Moreover, during FY 18, Privigen sales grew 13% & Hizentra sales grew 12%, both at CC, while IDELVION is on track to become the standard of care for Haemophilia B patients, Specialty Products portfolio sales grew 24% at CC, due to an ongoing growth in Kcentra and launched HAEGARDA for patients with Hereditary Angioedema. Additionally, for FY 19, CSL planned to open between 30 and 35 new collection centers and expects a modest increase in plasma costs, which will affect overall margin growth. For FY 19, CSL’s net profit after tax is expected to be in the range of approximately $1,880 to $1,950 million at constant currency, which reflects growth over FY18 of 10-14%. Meanwhile, CSL stock is trading at a very high P/E. Based on the foregoing, we give an “Expensive” recommendation on the stock at the current price of $ 219.050.

 
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