I just finished finding information on my new company and thought I would share it with you all. I am ready for this term so let’s do this!
The company I received on Friday was Automotive Holdings Group Limited (AHG).
AHG (Automotive Holdings Group Limited) is a diverse automotive retailing and logistics group with operations in every Australian mainland state and in New Zealand. This company is the Australia’s largest automotive retailer, with operations, as mention, across Australia. AHG’s operates via subsidiaries that include, Rand Transport, Harris Refrigerated Transport, Scott’s Refrigerated Freightways and JAT Refrigerated Road Services, AMCAP (motor parts and industrial supplies distribution) VSE (vehicle storage and engineering), Genuine Truck Bodies, Higer Bus, and KTM Sport motorcycles and HQVA (KTM and Husqvarna motorcycle importation). The current share price for Automotive Holdings Group Limited is $3.67, this be tracking up throughout the past couple of months.
The company was first listed on the Australian Stock Exchange on the 31st of October 2005. The Company has raised $45.7 million through the issue of 45.7 million shares and, at listing, had million shares on issue. The next year AHG acquired two Ford and Mazda dealerships in Auckland, New Zealand. Later that year, AHG acquired the McGrath Lander Group dealerships in NSW, this is one of the largest dealership groups in Sydney. This then consolidated AHG as Australia’s largest automotive retailer. In 2007, they acquired Zupps Group which is Queensland’s largest privately owned automotive retailing group. Throughout the years the company has made expansions to its subsidiaries and has had acquired many different businesses. In 2013, AHG agreed to a three year major sponsorship of the Melbourne Football Club in AFL. The company is forever acquiring and being rewarded business which are continuing to expand.
The current board of directors has seven people, one of which is a female. The CEO of AHG is John McConnell. He was appointed this role in August last year and assumed the role of Managing Director from January this year.
In the first article I found about AHG, it mentions how downgrades on May were largely blamed on the weak West Australia and Queensland economics to which AHG and AP Eagers, an auto- exposed stock listing. It is interesting to see that effects in the market effects different companies in the same category the same way.
The second article I read was posted on the 13th of June 2017 and was headlined with ‘Automotive Holdings Group: bumps in road but potential there.’ To begin with, they used an unintentional pun about roads when it is related to a car business. It goes on to talk about how the company ended the financial year on a sour note. It also talks about how the company downgraded guidance by 10 percent to $88 million, and shares hit a four year low of $2.91. The downgrade was against a backdrop of wakening industry fundamentals.
‘Two key concerns were:
- Stalling new-car sales across the country (particularly in Western Australia).
- An anticipated tighter financing ability, largely due to ASIC’s proposed ban on flex commissions for auto finance, which translates to lower revenues, and, owing to the company’s high fixed costs, lower margins.’
AHG has a long and successful history of acquiring auto dealerships and this is something that seems to be continuing over the years ahead. Acquisitions have driven about 10 per cent annual revenue and earnings growth in the past three years, well above new-car sales growth of about 1 per cent. I found this article really interesting and helped me gain further understand of the company.
To finish off here is a video of the South Melbourne dealership being built in 2013. This is just one of the many dealerships that AHG has acquired over their lifetime thus far. I am excited to get to know my company very well throughout the twelve week term.
All comments are welcome!
Hope everyone has a wonderful day!