Why this ASX All Ordinaries share has rocketed 16% in a week

This particular S&P/ASX All Ordinaries Index (ASX: XAO) company is enjoying an impressive trading week, riding a share price increase of 15.77% to $2.79 over the past five days.

Fleet management company, SG Fleet Group Ltd (ASX: SGF) released its half-year results yesterday. To say ASX investors were pleased with the details might be an understatement given the 19% share price spike by the session’s end.

Today, the SG Fleet share price is down 1.77% to $2.78 at the time of writing.

SG Fleet share price spikes on 16% profit surge

For the half-year ending 31 December 2021, SG Fleet highlighted:

• $29.7 million in profit, a 16.6% increase against the prior corresponding period (1H21)
• Underlying net profit after tax (NPAT) of $39.3 million, up 54.3%
• Underlying earnings per share (EPS) at 12.02 cents per share, up 23.5%
• Fully franked interim dividend of 8.318 cents a share, up 15.7%.

The company saw increases in both reported and underlying NPAT — including an “$8.1 million and $9 million four-month contribution respectively” from the LeasePlan Australia and New Zealand businesses.

After acquiring LeasePlan in September last year, SG Fleet expects to continue reaping the benefits.

SG Fleet announced that shareholders will be paid a fully franked interim dividend of 8.318 cents a share on 10 March.

What else happened in the half?

SG Fleet also gave an update on both its local and global operations.

The Australian segment of the business saw “a significant number of new accounts” and “several large contract extensions”, the company said.

It also reported that customers were increasingly replacing their fleets with hybrid or electric vehicles.

Just across the water, the company’s New Zealand business continued to be impacted by the country’s COVID-19 lockdowns. However, it was buoyed by the renewal of “a large government contract”, according to the announcement.

SG Fleet also saw a “number of new business opportunities” as the United Kingdom began to relax its COVID-19 restrictions.

Since 31 December 2021, the price of this ASX All Ordinaries share has increased by 6.9%.

Management commentary

Speaking on the results, CEO Robbie Blau said:

Our Corporate businesses in Australia, New Zealand and the UK continued the strong performance delivered during the COVID-19 period and Novated demand is growing steadily. Supply disruption still dominates our operating environment and this impacted our ability to deliver the increasing number of orders won in this and earlier periods. A significant proportion of this order pipeline will consequently be delivered in future periods.

SG Fleet shares underperform All Ordinaries index

Over the past 12 months, the SG Fleet share price has increased by just 1.4%. By comparison, ASX All Ordinaries shares increased collectively by 6.4%.

SG Fleet saw its 52-week high of $3.29 in June last year and hit its annual low of $2.21 in late January.

The company has a market capitalisation of $967 million.

The post Why this ASX All Ordinaries share has rocketed 16% in a week appeared first on The Motley Fool Australia.

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Motley Fool contributor Alice de Bruin 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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