- Automotive repairer AMA Group’s (AMA) share price has fallen nearly 20 per cent on the Australian market today
- In an update, the company says its EBITDA for the 2020 financial year is likely to fall between $73 and $77 million
- This marks around a $25 million drop after earlier in the year detailing EBITDA was expected to be over $100 million for the financial year
- Shares in AMA Group are now trading for 90 cents each
Automotive repairer AMA Group (AMA) has seen its share price plunge today after detailing the business has been affected by weather and market conditions throughout the year.
In early October, AMA released a forecast earnings before interest, tax, depreciation and amortisation (EBITDA) for the 2020 financial year, expecting to receive over $100 million.
Today’s update to the market outlined the company now expects EBITDA for the 2020 financial year to fall between $73 million and $77 million.
“Prolonged drier weather conditions in the first half and the ACAD (Automotive Components and Accessories Divisions) Division has been impacted by a pronounced year-on-year decline in new car sales impacting the industry as a whole,” the release wrote.
However, despite the downturn, AMA stated based on historical trends it believes the market will pick up again shortly.
The integration of the Capital Smart and ACM Parts companies are “proceeding better than expected,” the company explained. In October, AMA purchased a 90 per cent interest in Suncorp’s businesses for $460 million.
During the 2021 financial year synergies are set to total $17 million, on track with figures previously released by the company.
Additionally, the company has recently purchased fellow automotive repair businesses, Smash Care, Diplocks and All Transport. This represents 10 new sites, and once integrated, will add roughly $30 million in revenue and $2.5 million in EBITDA to the group.
AMA’s share price closed 18.64 per cent in the red today, shedding 21 cents of its value. Shares in the company are now trading for 90 cents each.