McMillan Shakespeare Limited (ASX: MMS) shares will be on watch today after the company announced a business update and preliminary result for its FY21 first-half trading period. At yesterday's closing bell, the McMillan share price finished the day at $11.54.
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Why will the McMillan share price be in focus?
It will be interesting to see where the McMillan share price heads today on the back of the company's latest update.
According to this morning's release, McMillan advised it is continuing to experience tailwinds within the salary packaging, novated leasing, and fleet & asset management market.
Despite the challenging operating environment from COVID-19, McMillan revealed that its business performance is rapidly recovering. In particular, novated lease sales are rebounding, remarketing values for used vehicles are seeing stronger returns, and its Plan Partners is on an upwards growth trajectory.
As a result, the company anticipates that underlying net profit after tax for the FY21 first-half period will be $42.7 million. McMillan said this includes a $7.3 million payment from the Australian Government's JobKeeper scheme.
The company is scheduled to release its half-year results for the 2021 financial year on 24 February.
Management commentary
McMillan CEO and managing director Mr Mike Salisbury welcomed the favourable trading conditions, saying:
We are pleased with the underlying performance of the business in the first half. Our investments in digital technologies and our ability to flex our operating model has delivered a stronger performance and is reflected in the ongoing positive feedback we have received from our customers.
We have benefited from unusual trading conditions in the broader motor industry in the first half. These conditions are expected to normalise throughout the course of the second half of the 2021 financial year and as such, operating performance in the second half is expected to be similar to the first half, excluding the JobKeeper contribution.
Review of the McMillan share price
The McMillan share price has gone on a seesaw ride over the past 12 months. Its shares hit a 52-week high of $13.23 last February, before falling to a decade-low of $5.01 the month after.
Since then, the McMillan share price has gradually moved higher with a few bumps along the road.
In comparison to this time last year, McMillan shares are down 9.8%.
Based on the current McMillan share price, the company commands a market capitalisation of around $893 million.
