Kelsian (ASX:KLS) has seen shares rise 4.3% in Wednesday morning trades as the company moves to divest its Australian tourism portfolio to better deliver value.
Listen to the HotCopper podcast for in-depth discussions and insights on all the biggest headlines from throughout the week. On Spotify, Apple, and more.
Generating $160M of revenue in FY24, the bulk of Kelsian’s divestment includes SeaLink ferries services in most Australian States and Territories.
Captain Cook Cruises in multiple states and the SeaLink service running atop Sydney Harbour are among those to be divested; notably, the company is set to retain its WA-based Transperth ferry services.
(That may or may not be because that State’s ferry system is to be expanded by the government.)
All in all, investors are clearly appreciative of the move.
That’s probably because Kelsian’s 1Y chart looks like a downward slope, with returns over that period down more than -50%.
But whether the stock does go ahead with its move to effectively sell SeaLink across Australia depends on what it can get for the trouble.
“Kelsian will only proceed with a potential transaction(s) for a sale of the Tourism Portfolio if value and terms are attractive and determined to be in the best interests of shareholders,” Kelsian wrote.
But commentary from chair Fiona Hele sounded more decisive in nature – especially given she pointed out the gov’t support many SeaLink services enjoy, allowing the company to take firmer financial projections to interested buyers.
“The divestment of the Tourism Portfolio will see Kelsian emerge as a more infrastructure like, commuter and contracted business, allowing us to focus on delivering essential journeys through marine, bus and motorcoach transport,” Hele wrote.
More market news
Never-ending: And just like that, Trump’s tariffs are back causing more market chaos
Meet GeoGeorge: The HotCopper poster so accurate he got hired as an analyst
“Many of the continuing businesses are underpinned by defensive long-term government-backed service contracts with cost base protection.”
KLS last traded at $2.68/sh.
Join the discussion: See what HotCopper users are saying about Kelsian and be part of the conversations that move the markets.
The material provided in this article is for information only and should not be treated as investment advice. Viewers are encouraged to conduct their own research and consult with a certified financial advisor before making any investment decisions. For full disclaimer information, please click here.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.