The end of the financial year ending 30 June 2018 saw Smartgroup’s share price react positively, after a 27% increase in first half 2018 profits.
Shares of Smartgroup corporation Ltd [ASX:SIQ] are also reflecting this positivity and are currently trading at 13.17, surging by 15.93% at the time of writing.
Client growth aiding Smartgroup’s share price
A combination of things have been assisting Smartgroup’s share price. Their success in delivering several services to clients is an initial cause for positivity for investors. This has allowed continued client growth, which we saw carry over into the healthy half-year financial results.
Deven Billimoria, Smartgroup Chief Executive Officer, spoke optimistically of these results:
‘It has been another successful 6 months for the Group with positive financial results, continued client growth and initial success in delivering multiple services to clients. The integration of acquisition is tracking well and we remain focused on operational excellence as we consolidate our salary packing service delivery.’
This also led the company’s board of directors to report fully franked interim dividends of 20.5 cents per share — an increase of 24% compared to the prior corresponding period.
On the back of this, Smartgroup’s profit after tax has risen 27% to $38.5 million compared to its 2017 half year results. Revenue also exceeded the company’s 2017 half results by 26%, at $122.6 million.
These developments have helped the company’s share price, despite the generally negative outlook for the ASX this week. Uncertainty caused by political turmoil in Canberra has caused the ASX to fall both yesterday and today, making Smartgroup’s 15% rise even more exceptional.
What’s in store for Smartgroup’s share price?
The turbulence this week likely isn’t over, with events in Canberra continuing to cast a pall over markets. This may lead to Smartgroup giving up some of its recent gains. Though any share that can rise when the rest of the market is falling is also likely to draw some attention to itself, which may help to prop it up in days to come.
For Money Morning
PS: Investment expert Sam Volkering’s top picks. Get your Free report : ‘Top three ASX stocks with the biggest potential for 2018.’ download now.