Servcorp (ASX:SRV) has reported a record first-half profit, with underlying net profit before tax (NPBIT) rising 19% to $34.4 million for the six months ending 31 December 2024. The company also recorded statutory net profit after tax of $34.6 million, a 76% increase from the prior corresponding period.
The workspace solutions provider, which operates 135 floors across 41 cities in 20 countries, saw underlying free cash rise 13% to $40.5 million, while underlying operating revenue increased 7% to $158.8 million. Statutory net profit before tax surged 70% to $38.3 million.
Servcorp declared an interim dividend of 14 cents per share, 10% franked, payable on 2 April 2025, with total dividends for FY25 expected to be at least 28 cents per share.
Growth and strategic initiatives
The company continued its global expansion, investing $14.8 million to open four new locations during the period, including a replacement floor in Australia. Servcorp expects to add five more floors in the next 12 months, expanding its network to 140 locations.
Significant technology advancements were also made, including:
- Completion of a global booking system, streamlining reservations and improving efficiency.
- Facial recognition for check-ins, enhancing security and customer convenience.
- Development of an AI strategy and data platform, aimed at commercialising AI-driven solutions.
Financial outlook
Servcorp reaffirmed its full-year guidance, forecasting underlying NPBIT of $61 million to $65 million, with free cash expected to exceed $75 million.
The company’s cash balance remains strong, with over $120 million in cash and investments, positioning it well for further growth and shareholder returns.
Servcorp CEO Alf Moufarrige noted the company is tracking towards the higher end of its guidance range, citing strong demand, operational efficiency, and continued expansion as key factors driving performance.
