Smartgroup (ASX:SIQ) subsidiary Smartsalary has been appointed the South Australian Government’s exclusive administrator of salary packaging services and novated leasing services under a new 5-year agreement.
As well as salary packaging services and novated leasing services, Smartsalary will exclusively manage a panel of third-party novated leasing providers of financiers under the contract.
Smartgroup, which has a market capitalisation of $1.1 billion, says the contract will begin on 1 July 2024, and its services will be made available to 110,000 South Australian Government employees.
This tender win will see further investments being made by Smartgroup in sales, customer education, and customer service roles, including in Adelaide, in preparation for the contract start date.
Smartgroup Chief Executive Officer (CEO) Scott Wharton says the company won the contract following a ‘highly competitive’ tender process.
“This appointment reflects our compelling proposition for the South Australian Government and their employees, our longstanding commitment to South Australia, as well as our overall experience and capability in providing services to State and Federal Government employees across Australia.”
“This appointment reflects our compelling proposition for the South Australian Government and their employees…”
Meanwhile, the company says it expects to report 2023 net profit after tax and amortisation (NPATA) of $63 million.
Smartgroup’s current revenue expectation for the 2023 year is $249 million, largely driven by ‘higher’ novated leasing volumes.
As volumes grow, the company expects that there will be a further need to add front-line and operation resources.
Smartgroup offers salary packaging, fleet management, and a range of other services to organisations across Australia.