Adelaide Brighton Limited (ABC):
Cement and masonry group Adelaide Brighton is investigating the possible involvement of an employee in a series of underpayments the company says may have been deliberately hidden. Forensic accountants have been called in to look into discrepancies relating to a small number of customers underpaying for products supplied to them “over a sustained period”, Adelaide Brighton informed the ASX on Monday. The company said there may be a negative impact on 2016/17 earnings of up to $14 million, less any amounts recovered.
Aurizon Holdings Limited (AZJ):
Rail haulage group Aurizon said there would be "strategic alignment" in owning Queensland's Wiggins Island Coal Export Terminal after confirming it would bid for the financially troubled export terminal as part of a consortium. As reported by The Australian Financial Review's Street Talk column, Aurizon has teamed up with financial group Macquarie to make a $4 billion bid for WICET, which exports coal from the Port of Gladstone. "As part of a consortium proposal, Aurizon would acquire WICET and other consortium members would acquire one or more of WICET's source mines," Aurizon said on Monday. The bid is the first big strategic move made by new Aurizon chief executive Andrew Harding, who took over from Lance Hockridge a year ago and comes as WICET tries to restructure billions of dollars of debt to avoid bankruptcy. The rail group, which provides access to rail tracks and coal haulage services in Queensland's Bowen Basin, is expected to take control of WICET's port operations, while Macquarie and Canadian partner Brookfield would buy a number of the port's biggest contracted customers, including mines owned by Glencore and Wesfarmers Curragh. Aurizon said the consortium's proposal would "secure long-term volumes" for WICET.
Australia and New Zealand Banking Group Limited (ANZ):
ANZ has issued an apology to customers and acknowledged that during trading on the BBSW market, a small number of traders attempted to engage in unconscionable conduct on ten dates between September 2010 and February 2012. “We know our customers and the community expect better from us and we apologise for both the attempted unconscionable conduct and our inability to prevent or detect the behaviour,” ANZ Chief Risk Officer Nigel Williams said. ANZ has agreed to a $10 million penalty, make a payment of $20 million to a Financial Consumer Protection Fund and a $20 million payment toward ASIC’s costs as part of the resolution. The bank has also agreed to enter an enforceable undertaking with ASIC, where an independent expert will be appointed to review controls, policies, training and monitoring of BBSW trading.
BHP Billiton Limited (BHP):
BHP’s $US10 billion ($13bn) US shale sale is gathering pace as oil prices stage a comeback, with the big miner now putting together datarooms for its complex suite of onshore oil, gas and infrastructure assets. BHP has put a two-year target on exiting its shale assets in Texas, Arkansas and Louisiana, but is hoping to do so sooner, despite talk among some investors the assets could be worth hanging on to if oil prices continue to rise. By the end of this financial year, it is understood management expects to be well on the way to exit, whether through its preferred route of a trade sale or the less likely option of a spin-off.
Cabcharge Australia Limited (CAB):
Taxi industry and general payments provider Cabcharge is banking on a plan to go all in with Microsoft's Azure cloud computing platform to help it deliver an ambitious new suite of technology options to lure back customers and drivers from Uber. Speaking to The Australian Financial Review ahead of an appearance at a Microsoft Summit in Sydney this week, Cabcharge's chief technology officer Deon Ludick said the company was facing its Uber challenge by completely reorganising its internal technology operations and was equipping cabs with superior technology to its illustrious rival. New services in the pipeline include a plan to turn hailing cabs in the street into a digital transaction, to outgun Uber's app in accurately telling customers where their ride is, making a digital version of Cabcharge's e-tickets for use on smartphones and putting Apple Pay into its 13CABS app. Mr Ludick said cars in its fleet of affiliated taxis could be kitted out with more advanced technology than Uber vehicles, because Uber relied on whichever smartphone its driver happens to have.
Commonwealth Bank of Australia (CBA):
One of Commonwealth Bank's largest shareholders, AustralianSuper, will vote against the re-election of a veteran board member at the company's annual meeting on Thursday in response to the bank's handling of AUSTRAC's money-laundering accusations. AustralianSuper has $120 billion under management, will vote against independent non-executive director Andrew Mohl. To be held in Sydney on Thursday morning, the annual meeting will be watched closely as the bank looks to head off a second strike against its remuneration report, which would automatically trigger a board spill if successful. AustralianSuper was critical of the bank's decision to introduce "soft bonus targets" for group executives last year leading to a first strike. But it will not vote against the revised remuneration scheme. It owns $2 billion worth of Commonwealth Bank shares, making it one of the largest shareholders on the register. A spokesperson for the investment giant declined to comment on its voting intentions in detail but did not deny it would vote against Mr Mohl on Thursday.
Commonwealth Bank of Australia (CBA):
The $3 billion superannuation fund First Super is running a backroom campaign to convince the $500bn union-and-employerbacked industry fund sector to spill the board of Commonwealth Bank at its shareholder meeting this week. The bank, which holds its annual general meeting on Thursday, faces the threat of a “second strike” against its proposed salary packages for its more senior executives and board members this year, after 51 per cent of shareholders voted against the previous year’s remuneration report. A letter obtained by The Australian, sent by First Super chief Bill Watson to Stephen Rowe, chief executive of the $9 billion Vision Super fund, urges him to use his shares to vote against CBA’s “opaque” remuneration structure and send a message to the lender over its “egregious” mismanagement, which has led to allegations it breached anti-money-laundering legislation more than 53,000 times, the CommInsure life insurance scandal and the CBA Financial Planning debacle.
Elders Limited (ELD):
Shares in agribusiness company Elders have surged after it announced it had more than doubled its full-year profit off the back of low interest rates and high livestock prices and was paying out a dividend for the first time since 2008. For the year to 30 September, Elders booked a net profit after tax of $116 million, up from $51.6m the previous year. It comes as a result of a number of strategic acquisitions over the financial year and improved profitability across its product range, the company said. Operating cash inflow of $81.6m for the year was up $32.9m on the prior corresponding period, underpinned by strong cash conversion of operating profits and variability of livestock activity leading up to balance date, the company said in its financial results statement. Margins were boosted $35.1m, up $8.9m, in the company’s financial services arm, after the company bought a 30 per cent stake in livestock financing business StockCo. Underlying profit in the company’s feed and processing services went up by 17 per cent or $1m. Margins for Elders real estate business improved by $2.7m.
Medibank Private Limited (MPL):
Medibank chairman Elizabeth Alexander has moved to hose down criticism from green activists at today’s annual general meeting with a promise to reduce the health insurer’s exposure to carbon-intensive assets. Ms Alexander’s comments on the issue, to be made later today at Medibank’s (MPL) AGM, follows Nib’s meeting last week, which was dominated by questions on the company’s exposure to carbon-intensive investments. Nib outlined that its exposure to coal and fossil fuels was less than 1 per cent of its portfolio and was being monitored. Ms Alexander will say later today that Medibank recognises its role as a corporate citizen and the increasing expectations the community had of corporate Australia. “Businesses are now in a greater position to use their influence to make a stand on issues that are important to the community,” she said in her speech. Medibank’s chairman said that during the year the insurer had made a commitment to be carbon neutral in its direct emissions and energy consumption by the end of 2018.
National Australia Bank Limited (NAB):
National Australia Bank is pushing to inject more technology talent into its workforce. However, simply hiring more coders and data scientists may not be enough for the bank to stay ahead of the pack in the digital race, experts have warned. It’s also likely to burn a deep hole in NAB’s pockets as it competes against its rivals and technology companies in a shallow talent pool. Advisory firm CEB’s HR practice lead Aaron McEwan warned that the supply of skilled workers in the artificial intelligence, machine learning and data science space was severely limited. While the skills shortage is a global phenomenon, CEB’s latest data paints a particularly grim picture in Australia. “As of last month, the AI talent pool was about 41,000 in the US, about 11,500 in the UK, around 7000 in Canada but in Australia we only have 3370 AI specialists,” he told The Weekend Australian. NAB is looking to hire 600 technology specialists as part of its strategy to reshape its workforce, a process that will see 4000 jobs cut over the next three years. But attracting good talent will be an expensive exercise and may not actually deliver the goods, according to Mr McEwan.
Nine Entertainment Co. Holdings Limited (NEC):
Nine Entertainment has flagged a better than expected start to the year, with chief executive Hugh Marks saying ad revenue and market share for the network have both performed well. Mr Marks told investors at Nine’s (NEC) AGM on Monday that the ad market for the first half of 2017/18 has been the upper end of previous earnings guidance, while good ratings had lifted Nine’s share of the metropolitan TV ad market above 39 per cent, compared to expectations of 37.5 per cent. While Mr Marks said second half expectations had not changed, he said full-year earnings were expected to be in the upper end of analyst forecasts of $204 million to $230m.
REA Group Limited (REA):
Shares in REA Group have drifted lower as analysts are increasingly split on whether the company's stock has outrun itself. Citi has downgraded the stock to neutral, arguing the stock has "run too hard" despite delivering a total shareholder return of 45 per cent over the past twelve months and enjoying a steady pickup in earnings momentum. "In our view, the most likely catalysts to drive further upgrades from here are an increase in property turnover rates or rapid growth in adjacencies such as mortgage broking," the Citi team write. Goldman Sachs on the other hand argue the strong first-quarter result has room to further improve and have revised their earnings-per-share forecast higher, maintaining a buy on the stock. "We believe this is justified given increased confidence in the earnings outlook and a rerating of peers," they write while upgrading their 12-month share price target 8 per cent to $80. However, UBS has downgraded the stock to a sell arguing REA has a great business but is too highly valued at the moment. "The first quarter result dropped jaws...but is this as good as it gets?" posed the analysts. "The market should expect a softer 2Q18 & FY18 [with] topline growth to slow," the UBS analysts write. "We'd look for a lower entry point."
Suncorp Group Limited (SUN):
Former finance minister and current Essendon chairman Lindsay Tanner has been appointed a non-executive director at insurer Suncorp, effective January 1. His appointment fills a vacancy created by the retirements of Bill Bartlett and Ewoud Kulk after the company’s (SUN) annual general meeting in September.
(Source: AIMS)
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