Seven Group Raises Annual Earnings Guidance on Strong Industrial Services Performance

Australian conglomerate Seven Group has revised its annual earnings guidance, citing a robust performance by its industrial services businesses in the latest quarter. The company now anticipates a percentage improvement in earnings before interest and tax (EBIT) of between high single digits and low teens in the 12 months through June, surpassing its previous forecast of high single-digit EBIT growth.

Chief Executive Ryan Stokes expressed satisfaction with the group's year-to-date outperformance, attributing it to robust customer demand and disciplined execution across all business divisions. Speaking at the company's annual meeting on Thursday, Stokes highlighted the strong performance of the Industrial Services division, which includes investments in WesTrac, Coates, and Boral. This division experienced substantial growth between July and September.

The success of the Industrial Services segment can be attributed to the increasing demand for support activity in mining production, a strong committed order book, and continued strength in infrastructure and construction projects. Stokes also mentioned ongoing efforts to enhance operating leverage and profit margins within the Industrial Services division.

Looking ahead, Seven is optimistic about the future growth of Industrial Services. It now expects EBIT to rise by low to mid-teens in the 2024 fiscal year, surpassing its previous guidance of high single to low double-digit EBIT growth.