Silk Logistics Holdings 1HFY24 Results Overview

Silk Logistics Holdings Limited (ASX: $SLH) has reported its half year results for the period ended 31 December 2023. The company achieved a 9.0% increase in revenue, reaching $276.5 million, and a 7.9% growth in underlying EBITDA, amounting to $47.7 million. Silk also expanded its trading customer base to 594 and completed the acquisition of Secon, a specialized Port Logistics business.

Executive Commentary on 1HFY24 Performance and Outlook

First half trading conditions were mixed and were characterised by strong export volumes, improved warehouse handling and distribution margins, and new Secon customers onboarded. These positives were balanced with an extended inventory adjustment period, subdued import container volumes and sustained cost pressures. Our ability to deliver on revenue and maintain our Underlying EBITDA margin highlights the strength and agility of our business model. As we enter the second half of FY24, our focus remains on driving cost efficiencies and delivering on our strong customer service ethos. We will continue integrating Secon and extending capability to other states which has already delivered cross-sell opportunities and new business wins. We anticipate further recent Secon customer wins will onboard from the commencement of FY25.

Summary of 1HFY24 Results and Outlook

Silk Logistics Holdings has demonstrated resilience and growth in the first half of FY24, achieving a 9.0% increase in revenue and a 7.9% growth in underlying EBITDA. Despite challenges such as subdued import container volumes and sustained cost pressures, the company maintained its Underlying EBITDA margin, reflecting the strength of its business model. Looking ahead, Silk remains focused on driving cost efficiencies, integrating Secon, and extending its capability to other states to realize cross-sell opportunities and new business wins. The company anticipates further recent Secon customer wins to onboard from the commencement of FY25. Silk's full year guidance includes expectations of revenue between $540.0m and $560.0m, and underlying EBITDA between $92.0m and $98.0m, subject to no further adverse changes in economic conditions. The company aims to preserve profitability through increased operational efficiencies, driving organic growth, and integrating acquired businesses to realize synergy benefits. Silk maintains a positive outlook with respect to its business development pipeline and its customer value proposition to win further new business.