Catastrophes lift Johns Lyng earnings outlook
Building services provider Johns Lyng Group says its full-year result will be stronger than expected following the Sydney hailstorm and Townsville flooding.
“Two major non-forecast catastrophic events, in NSW and in north Queensland, have added, and will continue to add, to our volumes, primarily in the second half,” CEO Scott Didier said.
“While it is too early to predict the full extent of those volumes, we have to date recorded unprecedented job registrations from these events.”
Sales are expected to top previous expectations by about 4% while operating earnings before interest, tax, depreciation and amortisation are expected to outperform by 8% to reach $19.9 million.
The forecast includes early claims activity from the hailstorm, but excludes Townsville because it is too early to quantify the impact.
Johns Lyng net profit grew 14.3% to $7.9 million in the first half, while total sales increased 3.3% to $152.6 million.
The company says its growth was supported by new contracts, including with strata insurer CHU, Crawford and Suncorp.
The group opened its first Tasmanian office in November and bought a controlling stake in Dressed For Sale, a residential property staging and styling business.
The fragmented insurance building and restoration market offers consolidation opportunities, while the wider market is growing due to several key drivers, it says.
“We know extreme weather events are becoming more frequent and, with population growth in coastal regions on the increase, we are well positioned to respond to them,” Mr Didier said.