The Korvest Limited (ASX: KOV) share price is surging today following a positive trading update from the Australian-based manufacturing company.
At the time of writing, the Korvest share price is up 8.93% to $6.10. Earlier on Friday, the share price rose as high as $6.35, which was 13.4% above yesterday’s closing price.
What did Korvest announce to the ASX?
In its release, Korvest advised that unprecedented levels of large project work along with favourable market conditions has led to a strong start for FY22.
Korvest highlighted the company’s strong performance in their June 2021 annual report but gave no earnings guidance.
The pull forward of major project supply means that Korvest now expects first-half profit before tax will exceed $8 million.
The guidance includes the previously disclosed $0.5 million profit on sale of the Power Step and Titan Technologies.
By comparison, the company achieved a net profit after tax for the prior corresponding period of $2.835 million.
The accelerated delivery of significant project work is estimated to lead to an earlier than scheduled completion. Without winning new infrastructure contracts, the first-half performance is likely to taper off in the second half of FY22.
Korvest notes that the guidance assumes there is no adverse effect from COVID-19 on the construction industry.
While the current economic climate is unpredictable, Korvest is hopeful that major projects will continue to be supplied throughout FY22.
Quick take on Korvest
Founded in 1970, Korvest provides supplies cable and pipe supports, industrial access and safety systems, fastening solutions, and galvanising services.
Korvest is headquartered in South Australia but has sales offices across Australia and in New Zealand.
Korvest share price snapshot
Over the past 12 months, Korvest shares have travelled almost 40% higher, with the year-to-date up about 20%. The Korvest share price today is sitting towards the upper end of its 52-week range of $3.91 to $6.65.
Based on today’s share price, Korvest presides a market capitalisation of roughly $69.88 million. Korvest has approximately 11.45 million shares outstanding.
The post Why did the Korvest (ASX:KOV) share price jump 13% on Friday? appeared first on The Motley Fool Australia.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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