The APA Group (ASX: APA) share price is sliding this morning after the company released its financial results for the year ended 30 June 2020 (FY20).
At the time of writing, the APA Group share price is down 2.90% to $10.54 per share.
FY20 highlights
In today’s announcement, APA Group revealed revenue of $2.59 billion for FY20 – a 5.6% increase on the 2019 financial year.
The company reported profit after tax of $317 million in the 2020 financial year, up 10.1% on 2019. According to APA Group chair Michael Fraser, earnings were safeguarded by the company’s strong balance sheet and its long-term contracts.
APA Group reported earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.65 billion in FY20, an increase of 5.1% on FY19.
The company had operating cash flow of $1.1 billion in FY20, an increase of 8.3% compared to FY19. As at 30 June 2020, APA Group had around $2.5 billion in cash and undrawn debt facilities.
The company stated that it will pay a final distribution of 27 cents, the dividend component of which will be fully franked.
Outlook
Looking to the next financial year, APA Group advised it is expecting an EBITDA of $1.63 billion to $1.67 billion in FY21. It also expects distributions to be in line with the 2020 financial year.
Commenting on the outlook for FY21, Mr Fraser stated:
While our capacity contracts and regulated revenues mean that our business is somewhat resilient through economic cycles, APA’s revenues are still subject to recontracting decisions by customers, throughput volumes on certain assets, the timing of customer FID decisions, as well as lower CPI across the contracts portfolio.
He also stated that practical completion of the company’s Orbost gas processing plant would not take place until the end of the 2021 financial year.
About the APA Group share price
APA Group is a natural gas and electricity infrastructure business. It is the largest provider of natural gas infrastructure in Australia and has been listed on the ASX since 2000.
APA Group shares are up 30.76% since their 52-week low of $8.06, however, they have fallen 5% since the beginning of the year. The APA Group share price is down more than 4% since this time last year.
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Motley Fool contributor Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of APA Group. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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