On the 9th of August Transurban Stock ASX: TCL released their Full Year Results. The largest toll road operator in Australia reported revenue growth of only 0.1%. So let’s take a look at what was reported in TCL FY21 Earnings Report.
TCL Earnings Report: FY21 Results
Transurban has highlighted the below key metrics in the FY21 Earnings Report:
- EBITDA down 2.8% to 1,691 million
- Loss of 161million which has ballooned 161% YoY
- Free Cash of $1,278 million which is down (13% YoY)
- Toll revenue of $2,266million compared to FY20 of $2,295
- Average Daily Traffic seems to be returning to FY2020 levels, although the company mention this will depend on the size, length and severity of any lockdowns.
- Ongoing stakeholder response to COVID-19 included actions to support our customers, communities and our people
- Challenges remain on the West Gate Tunnel Project
- Large pipeline of opportunities progressing in core markets with funding optionality given resilient business model and balance sheet
From the above, it seems Transurban are still being significantly interrupted by the constant lockdowns being faced in Australia. Traffic Volumes in Sydney and Brisbane have nearly returned to Pre-Covid levels, whilst, Melbourne and North American traffic volumes have been significantly more affected. The group expects traffic volumes to rebound quickly once, lockdowns are lifted.
However, with the M8 and NorthConnex Tunnels now being opened and a strong balance sheet, this should position ASX:TCL for strong growth into the future.
Following their mediocre earnings report, TCL shares opened softly down 0.42%. However, over the past year shares are trading up 4.6% which has underperformed the broader market with is up 21.73%.
Although investors are still down ~12.5% from the Pre-COVID peaks.
Transurban Stock Fundamentals
Transurban Currently trades on a market cap of $39.2billion with a share price of $14.20.
Transurban Full Year Dividend
How much is the Transurban FY21 Dividend? A distribution totalling 21.5 cents per stapled security will be paid on 23rd August 2021 for the six months ended on 30th June 2021.
This will be made up of a 20.5 cents partly franked distribution from Transurban
Holding Trust and controlled entities and a 1.0 cent fully franked dividend from Transurban Holdings Limited and controlled entities.
This takes the total FY21 distribution to 36.5 cents per stapled security,
of which 1.0 cents is fully franked.
Does Transurban Offer a DRP? Yes, The Distribution Reinvestment Plan (DRP) will operate for this distribution payment.
Transurban’s dividend had been increasing YoY up until the COVID pandemic, however, as traffic volumes start returning we should start seeing this payment go up in line with the companies dividend policy.
Transurban Earnings Report: Prophet’s Take
TCL; Australia’s leading toll road operator has in our opinion provided decent results given the difficulties and uncertainties the business continues to face.
Whilst the risk isn’t worth the return in our opinion to hold directly in our portfolio, we are happy holding this stock as part of our VAS ETF.
Transurban continues to pay a dividend even in challenging times which is merit to its strong balance sheet, however, the company does have very complex debt facilities in which it uses to fund a lot of their project.
TCL is well-capitalized and has continued to grow its balance sheet. Future results will likely be dependant on the continued recovery from the COVID-19 pandemic.