The Kelly Partners Group Holdings Ltd (ASX: KPG) share price had a mixed trading day today. After hitting a 52-week high of $1.45 in early trading, the Kelly Partner’s share price dropped back to close flat at $1.30. Let’s take a closer look.
Why is the Kelly Partners share price on the move?
Kelly Partners announced last month it was conducting an on-market share buyback. The chartered accounting network plans to buy back up to 45.3 million shares or 10% of its shares outstanding.
The company reported it was experiencing continued growth. Senior management also recently purchased 344,417 shares from CEO Brett Kelly to align management interests with the company’s performance. The CEO maintains a holding of 50.01%.
According to Kelly Partners, the company has experienced revenue growth of 32% per year since its inception in 2006, and revenue growth of 15% per year since its initial public offering (IPO) in 2017. Dividend growth has been at 10% per year since its IPO.
Kelly Partners said it expected to reach revenue of $80 million per year by the 2024 financial year. The company also anticipates earnings before interest, tax, depreciation and amortisation (EBITDA) of $28 million per year by FY 2024. The company forecasts that it will double its net profit after tax and amortisation (NPATA) to $8 million per year by FY 2024.
About the Kelly Partners share price
Kelly Partners provides accounting services to small to medium-sized businesses and private clients. The company has offices in NSW, Victoria and Hong Kong.
In the year to 30 June 2020, Kelly Partners increased its net profit after tax to $4 million, up 64.8% compared to the prior year. The company had revenue of $46.4 million in the 2020 financial year, an increase of 16% compared to FY2019. The company’s underlying EBITDA in FY 2020 was $13.7 million, up 26.1% compared to the prior year.
In June, Kelly Partners acquired an accounting firm based in Bathurst, NSW. The acquisition was expected to deliver recurring revenue of $270,000 and add $130,000 to EBITDA. The acquired firm was set to move into Kelly Partners existing office in Bathurst. The company also announced that it was in acquisition discussions with several other firms.
The Kelly Partners share price is up 132.14% since its 52-week low of 56 cents, and has increased 30% since the beginning of the year. The Kelly Partners share price is up 34.02% 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 has no position in any of the stocks mentioned. 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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