Seven group (ASX:SVW) is controlled by billionaire Kerry Stokes with his son Ryan Stokes as the CEO. The Stokes family own 57% of the shares on issue. It is classified as an industrial stock. There are two commonly used definitions of an industrial stock. The broad definition is that all stocks that are not resource stocks are termed industrial stocks. The narrow definition is where stocks are classified into sectors. In Stockopedia there are 10 main sectors, one of which is Industrials. There are 23 stocks in the S&P/ASX 200 Industrials index, which is based on the GICS classification system, and Seven is the 6th largest.
Seven Group Holdings (SGH) is a diversified operating and investment group. It owns businesses and investments in industrial services, media and energy. Some of these businesses are owned outright. In others they own a controlling interest and a non-controlling interest in some others.
It is important not to confuse Seven group (ASX:SVW) with Seven West Media (ASX:SWM). Seven West Media is a separate listed business that owns media assets including the Seven television network and a newspaper and publishing company. However SGH also holds a 40% stake in SWM.
In FY23 SGH generated total revenue of $9,627 million. The major contributors to the revenue result were:
Westrac 51%
Coates 12%
Boral 36%
Westrac is wholly owned by SGH. They are the sole authorised dealers of Caterpillar equipment in WA, NSW and ACT. Caterpillar make large mining trucks and other mining equipment.
Source: Seven Group Holdings, FY23 Results presentation, 17/8/23
SGH also owns the whole of the Coates equipment hire business. Coates hire out equipment used for construction and engineering projects and are a top tier equipment hire business with approximately 27% market share.
Boral (ASX:BLD) is an independently listed company on the ASX, however SGH owns 72% of the shares on issue, giving them a controlling stake. Boral supplies building materials, specifically cement, concrete and asphalt.
These three businesses are the primary contributors to SGH’s top line revenue, but not the only contributors to its bottom line profits. This is due to the fact that they control these businesses and therefore they consolidate all of the revenue onto their Income Statement. For example, with Boral,…
