The Company in a Nutshell
- K-Bro is the largest private provider of linen laundering in Canada.
- This business model is built on recurrent business.
- ~56% of revenue is derived from health care institutions, the remainder from the hospitality segment.
- We do not cover K-Bro at the moment.
Date Reviewed | N/A |
Company Name | K-Bro Linen Inc |
Symbol | KBL.TO |
Sector | Industrials |
Industry | Specialty Business Services |
Beta | 1.091 |
PRO Rating | 3 |
Dividend Safety | 2 |
Business Model
K-Bro Linen Inc. is an owner and operator of laundry and linen processing facilities in Canada. The Company provides a comprehensive range of general linen and operating room linen processing, management and distribution services to healthcare institutions, hotels, and other commercial accounts. It operates about ten processing facilities and two distribution centers under two distinctive brands, including K-Bro Linen Systems Inc. and Buanderie HMR, in ten Canadian cities: Quebec City, Montreal, Toronto, Regina, Saskatoon, Prince Albert, Edmonton, Calgary, Vancouver and Victoria. Its Canadian division provides laundry and linen services to the healthcare and hospitality sectors through ten operating divisions. The Company’s UK division provides laundry and linen services primarily to the hospitality sector, with other sectors, including healthcare, manufacturing and pharmaceuticals, through five sites which are located in Cupar, Perth, Newcastle, Livingston and Coatbridge.
Current price | 34.69 |
ROE | 10.05 % |
ROIC | 7.90 % |
Shareholder Yield | 0.25 % |
5-Yr Total Return | 13.20 % |
1-Yr Total Return | 9.80 % |
Next Earnings Date | 11-07-24 |
Latest Quarter Information
What the CEO said:
I'm pleased with our strong first quarter results and our momentum to start the year. Both of K-Bro's healthcare and hospitality segments continue to experience steady growth trends and we remain focused on delivering industry-leading service to our existing and new customers. We see a positive outlook for K-Bro and are excited about our organic growth prospects and potential future M&A. Strategic acquisitions of complementary high-quality operators continue to be an important contributor to K-Bro's overall growth profile.
What we say:
06-19-2024, For Q1 2024, KBL's healthcare revenue increased by 8.4% Y/Y while hospitality revenue grew ~21.4%. KBL repurchased 64,554 shares in Q1. It ended 1Q'24 with a long-term debt of $65.7M, an active M&A pipeline, and acquired Shortridge Ltd. post Q1. KBL's planned capital spending is expected to be between $15M and $17M, including the expenditures associated with the Villeray acquisition. The company expects activity levels to remain strong in the healthcare and hospitality segments.
Investment Thesis
Dividend Triangle
5-Yr Rev. Growth | 6.00 % |
5-Yr EPS Growth | 22.70 % |
5-Yr Div Growth | 0.00 % |
Potential Risks
Debt/Equity | 0.70 |
Financial Debt to EBITDA (TTM) | 3.15 |
Current Ratio (Quarterly) | 1.75 |
Credit Score | 52 |
Dividend Growth Perspective
Dividend ($) | 1.2 |
Dividend Yield Fwd | 3.40 % |
Dividend Frequency | Monthly |
Average 5-Yr Yield | 3.65 % |
Payout Ratio (%) | 73.25 |
Cash Payout Ratio (%) | 38.15 |
DGR 1-Yr | 0.00 |
DGR 3-Yr | 0.00 |
DGR 5-Yr | 0.00 |
DGR Streak | 0 |
Chowder Score | 3.40 |
Next DVD PMT | 10-15-24 |
Valuation
(Data for `ddm_recent_annual_dividend` field are missing to build DDM tables)
Video Tutorial: How to Read the Stock Cards DDM Valuation
Market Cap | 371.00 M |
PE Ratio | 21.65 |
Fwd PE | 16.80 |
Price to Book Ratio | 2.10 |
DDM Valuation | N/A |
Average 5-Yr PE | 51.51 |
Value Score | 79 |
- All financial metrics are updated weekly.
- The DSR PRO rating and Dividend Safety Score are updated quarterly.
- The analysis (investment thesis, risk potential, dividend growth perspective and DDM calculation) is reviewed every 6 months.
- The PDF format includes only comments (no metrics) and is reviewed every 6 months.