SXE

 SXE

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Over the last 10 years, Southern Cross Electrical Engineering (ASX:SXE) has grown revenue at roughly 14.5% annually and earnings at 11% per year. However, a recent one-off loss of A$46.1 million impacted trailing net profits, leaving trailing twelve-month ROE near 1.4% alongside a very low debt-to-equity ratio. [1, 2, 3]

Profit and Revenue Growth

Revenue Trend: Experienced steady long-term expansion, scaling up past A$750 million to over A$800 million in recent full-year reports, driven by data centers, infrastructure, and renewable energy contracts. [1, 2]
Net Margins & Earnings: Historically maintained stable net profit margins around 4%, but heavy recent project adjustments and one-off write-downs compressed trailing net income down to about A$2.7 million. [1, 2, 3]
Guidance: Management has issued strong forward guidance, upgrading underlying EBITDA expectations past A$75 million. [1]

Debt Structure

Debt-to-Equity: Maintains a very conservative balance sheet with minimal long-term debt.
Total Debt/Equity Ratio: Roughly 5.2%, meaning the company operates almost entirely debt-free. [1, 2, 3, 4]

Return on Equity (ROE) & Returns

ROE Levels: Historically fluctuated between 11% and 15% during stable operating years, but sits lower at roughly 1.4% on a trailing basis due to recent non-recurring charges. [1, 2, 3]
Shareholder Return: Despite bumpy short-term earnings metrics, the market cap has grown significantly over the decade, with strong multi-year gains reflecting an expanding backlog of major commercial projects. [1, 2, 3, 4]

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Valuation:

Buy around $2- $3

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dividends

Consistent dividend growth

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