There are some S&P/ASX 200 Index (ASX: XJO) shares that manage to keep growing over the long-term.
2020 has been a difficult year for many businesses, but there are some that manage to regularly generate growth.
Here are three businesses:
Bapcor Ltd (ASX: BAP)
Bapcor is the leading auto parts business in Australia and New Zealand. Despite a blip through the worst of COVID-19, Bapcor continues to grow in FY21.
In the 2021 financial year to the end of November 2020, group revenue was up approximately 26%.
Bapcor said it's achieving operating leverage from lower expenses in areas such as travel and other areas of discretionary expenditure, as well as lower interest rates and the contribution Truckline, which wasn't in last year's comparative period.
For the first half of FY21, Bapcor is expecting revenue growth of at least 25% compared to the prior corresponding period. Net profit after tax (NPAT) growth is expected to increase by at least 50%.
Bapcor said that trade and wholesale make up around 80% of the business, and traded-focused businesses usually perform well in difficult economic conditions. This is showing through with Bapcor's current performance.
The ASX 200 share said that the changes it has made in its retail businesses helped grow retail revenue grow by around 40% over the prior corresponding period. Some improvements include upgrading its online capabilities as well as changing its product ranges. Bapcor also continues to increase its store count.
Fund manager Wilson Asset Management is a fan of Bapcor, the fundie believes the company has benefited from an increase in domestic travel, reduced usage of public transport and increased second-hand car sales. WAM said that Bapcor has a strong balance sheet and the fund manager believes the company is well placed to make earnings-accretive acquisitions.
Xero Limited (ASX: XRO)
Xero is a cloud accounting software business. It has been growing its subscriber numbers for many years.
The latest result for the ASX 200 share, being the FY21 half-year report, was no exception. Total subscribers grew by 19% to 2.45 million. This helped operating revenue grow by 21% to NZ$409.8 million and annualised monthly recurring revenue increased by 15% to NZ$877.6 million.
Despite already delivering a lot of growth, Xero says that it has ambitions for high-growth whilst being disciplined with costs and targeted allocation of capital. It's going to keep investing in innovation, new products and customer growth.
A key focus for Xero is the UK, which is a much bigger market than Australia. In the HY21 result its UK subscriber numbers grew by 19% to 638,000 with revenue growing by 33%.
Brickworks Limited (ASX: BKW)
Brickworks is a business that has been growing for decades. It started out as just a brickmaker in Australia, but now it has a diversified portfolio of different building product businesses. Its other products that it's involved with include paving, masonry, precast, roofing and cement.
The ASX 200 company has expanded recently by acquiring three brickmakers in the US, including Glen Gery. Brickworks is now the leading brickmaker in the north east of the US and it has plans to grow the US business, whilst also improving efficiencies and margins.
A key part of Brickworks' asset value is its holding of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares. It owns around 40% of Soul Patts, which is a diversified investment conglomerate which is invested in sectors like telecommunications, resources, listed investment companies (LICs) and financial services.
Another part of the Brickworks business is its growing industrial property trust that it owns half of, along with joint venture partner Goodman Group (ASX: GMG). This trust continues to build new properties for prospective tenants, like Amazon, which should grow the value of the trust and increase the rental profits.
At the current Brickworks share price it has a grossed-up dividend yield 4.3%.
