Strong Revenue Growth but Modest Growth in Earnings for KEX in Q1

  • Knutsford Express Services Limited (KEX) recorded a net profit of $86.18Mn for the first quarter that ended August 30, 2023. This represents a 2.3% increase in profitability when compared to the $84.23Mn recorded over a similar period in 2022.
  • Revenue for the quarter was up by 18.5% to $491.79Mn, from the $415.09Mn recorded over the same period of last year. This was driven by continued strong demand for its suite of services, including passenger service which was supported by increased arrivals documented at the airports. Similarly, there has been strong demand by members of the public, both individuals and businesses alike, for courier services.
  • Administrative expenses for the quarter increased by 25.6% to $380.34Mn, which can be attributed to the expanded workforce which the company found necessary to meet customer demands. As a result of the increase in admin expenses which outpaced revenue growth, operating profit was down by 0.6% from $112.15Mn in 2022.
  • KEX’s stock price has increased by 24.8% since the start of the calendar year. The stock closed Friday’s trading session at $11.09 and currently trades at a P/E of 18.1x which is above the Junior Market Other Sector Average of 16.0x.
  • In the current financial year, KEX plans to bolster its fleet by deploying two (2) double-decker premium coaches into operation. Furthermore, another three (3) coaches will commence service by the end of Q3 of the current financial year to support growth and enhance customer experience.

(Source: JSE)