TCL - Transurban Group

[Muschu]

Starting to look a tiny bit better?

 

[Knobby22]

Bought some more at $10.55 at open.
The worries about analysts with regard interest rates is a them just being overwrought, everyone is in the same market.

Toll revenue growth is 10.9% EBITA growth 12.2%.
Traffic growth 4.8% particularly good in Brisbane and Washington.
Melbourne went backward but that is because of the extensive road works which annoy me at present and encourage alternate routes.

The pipeline for future projects and upgrades is very impressive. Long term buy.

 

[just_jay]

FY18 results released today.

Highlights:

• FY19 distribution guidance of 59.0 cps
• FY19 distribution guidance of 59.0 cps will be maintained in the event of a successful WestConnex bid
• Linkt tolling brand now active across Sydney, Brisbane and Melbourne, incorporating fee reductions and enhanced digital platforms for our customers
• Continuing focus on customer experience:
o Initiatives to improve customer assistance and reduce tolling debt and fines
o Voice of Customer program improves customer interactions
• Connected Automated Vehicle (CAV) trials underway across Australia and North America with the first Australian public trials of a highly automated vehicle occurring on CityLink
• Acquisition and financial close of A25 in Montreal providing second geographical market in North America
• Completion of the CityLink Tulla Widening and Monash Freeway Upgrade Projects in Melbourne providing travel time savings to customers
• Statutory profit from ordinary activities of $468 million
• Average daily traffic (ADT) grew by 2.2%2 inclusive of disruption from upgrade projects including CityLink Tulla Widening (CTW), Monash Freeway Upgrade (MFU), Logan Enhancement Project (LEP), Gateway Upgrade North (GUN) and Inner City Bypass (ICB)
• Proportional toll revenue increased by 8.7% to $2,340 million
• Proportional earnings before interest, tax, depreciation and amortisation (EBITDA) and before significant items increased by 10.2% to $1,796 million1
• FY18 distribution of 56.0 cents per security (cps) including the impact from $1.9 billion of equity raised to support the West Gate Tunnel Project

 

[just_jay]

Nice pick up in volume today (half of which occurred after 4pm) afer release of results. Price pierced resistance zone created by VCB on 15/06. Watch the ACCC decision date for WestConnex project on 06/09/18.

SL - 11.60

 

[Knobby22]

They got Westconnex as hoped.
Now they are in the same dominant position in Sydney as they are in Melbourne.
They were going to spin off a lot of cash but now with this acquisition the new debt is large so a rights issues is occurring.

 

[JTLP]

They got Westconnex as hoped.
Now they are in the same dominant position in Sydney as they are in Melbourne.
They were going to spin off a lot of cash but now with this acquisition the new debt is large so a rights issues is occurring.

I find this intriguing. A day before the ACCC says no issue with contesting. Next day secured. How could somebody not be in the know?

 

[Knobby22]

I find this intriguing. A day before the ACCC says no issue with contesting. Next day secured. How could somebody not be in the know?

They must have had clearly a better offer so they did the tender work in expectation of approval. They must have thought approval was likely.

 

[tinhat]

I find this intriguing. A day before the ACCC says no issue with contesting. Next day secured. How could somebody not be in the know?

Surely it is obvious to all that, in general, public interest oversight by government agencies and authorities has been rendered a hollowed-out facade; a smoke-screen for vested interests? It doesn't matter whether we are talking about financial markets, financial services, environmental protection, consumer interests.

 

[DNA2013]

What do people think of TCL as a "moat" stock? from this article?
https://mywealthforlife.com/transurban-ltd-share-review-asx-tcl/

 

[bigdog]

M Fool Reported
https://au.finance.yahoo.com/news/transurban-share-price-buy-profit-230650417.html

This morning Transurban Group (ASX: TCL) reported its half-year results for the period ending December 31 2018. The toll road operator posted a profit from ordinary activities of $145 million (down 56%) on revenue of $1,286 million, which is up 30.2%.

The company reported that on a proportional basis EBITDA (operating income) increased 9.9% to $1,001 million, which translated into free cash flow of $715 million left over to feed investors’ hunger for dividends.

A total interim dividend of 29 cents per share was declared, compared to 28 cents per share in the prior corresponding half. The company also maintained guidance for a final dividend of 30 cents per share to take full year dividends to 59 cents per share.

This places the stock on a yield of 4.7%, although it has already gone without the rights to the 29 cents per share payout. The group has previously stated it aims to grow fiscal 2020’s dividends at a mid-single-digit rate.

The net profit was dragged down despite toll road revenue growth by ballooning costs across a number of line items on its profit and loss statement including interest on debt costs, depreciation, construction costs, and employee expenses.

The rising costs reflect a debt-driven expansion push by the group with it undertaking nine new toll road development projects over the next 5 years including the major WestConnex development in Sydney that is estimated to have a total cost of $16.8 billion, excluding airport gateway costs.

Its being funded largely by public sector debt collateralised against future toll road revenues, with Transurban recently raising $4.8 billion to take its share of the giant project.

Fortunately for investors Transurban has a good relationship with governments as shown by its sky-high gross profit margins (EBITDA of $1,001 million on proportional revenue of $1,286 million) and pricing power, as it’s able to lift tolls for drivers who commonly have no choice but to pay if they want to travel to their destination.

 

[just_jay]

A blurb from the SMH markets blog
https://www.smh.com.au/business/markets/markets-live-20190212-h1b51i.html
*****

We've got hold of Macquarie's flash note on Transurban's results. Shares are currently down 2.3 per cent at $12.17. The price had been at a 13-month high of $12.46 yesterday.

Macquarie analysts write that Transurban's earnings before interest, tax, depreciation and amortisation (EBITDA), (ex transaction costs) was $1 billion, consistent with expectations. Sydney roads EBITDA is $418 million versus Macquarie's expectations of $414 million. Traffic stabilised in the fourth quarter, with a better road performance from M7 offsetting WestConnex's contribution (~$10m). M4 volume of 1.5 per cent may seem low but reflects the pace of the road ramp-up and the broad economy.

Citylink [in Melbourne] at $363 million was $10 million below expectation, with a soft fourth quarter traffic at 3.7 per cent along with lower fee revenue. This is a net disappointment.

Transurban Queensland performance $146 million was a little disappointing. Airportlink was the major variance, with costs materially higher than the same period in 2017. Traffic remains soft for the business, as the effect of road works still hampers Gateway and Logan Motorway. Free cashflow was $715 million well above our expectation of $656 million. 2018-19 was always a transition year. The result meets our expectation, but there are signs of a tough second half of 2018-19 traffic environment which will see some pressure on EBITDA growth.

 

[just_jay]

Some large volumes going through this morning in the first half hour of trade.

 

[Smurf1976]

Price is up nicely over the past few months from a low of 10.62 in October 2018 to yesterday's close of 12.79

A word of caution however as there are a number of previous tops at approximately this price in 2016 and 2017.

 

[Cam019]

 

[Knobby22]

What are you saying Cam? The long term signal white is up now?
What does the purple line mean.

 

[rederob]

Price is up nicely over the past few months from a low of 10.62 in October 2018 to yesterday's close of 12.79
A word of caution however as there are a number of previous tops at approximately this price in 2016 and 2017.

Technically TCL is on blue sky territory - having broken above all previous highs.
Until interest rates are likely to be increased, flights to the likes of TCL should prevail.

 

[Cam019]

What are you saying Cam? The long term signal white is up now?
What does the purple line mean.

I'm not really saying anything except there has been 4 entry signals for my system in the last 7 weeks. I was just posting charts to possibly create some discussion in charts I would be interested in this week.

The white dashes represents my wider ATR trailing stop and the purple line is a donchian channel representing the highest price the stock has traded at over the last 'n' candles.

 

[Knobby22]

I took up the SPP.
To me the company looks safe, consistent growth, increasing dividends. It is highly geared to reduce tax and should interest rates rise or a road building runs over budget are some of the risks.

I think they are too well run to get in trouble and there model is hard for government to resist.

 

[Knobby22]

TCL announced they have refinanced the 1.65mil syndicated bank facility on favourable terms but do not provide those terms, I suppose we have to read between the lines.

Opening of the new tollway in Washington USA on time and on budget was good news.

 

[rederob]

TCL announced they have refinanced the 1.65mil syndicated bank facility on favourable terms but do not provide those terms, I suppose we have to read between the lines.

@Knobby22 - just to be clear, it's actually A$1.65 billion.