A2 Milk Company Ltd (A2M):
The a2 Milk company has renewed its strategic arrangements with China State Farm as the exclusive import agent for the company’s products into China. Today’s move will see the two entities extend their partnership for a further three-years from July 1, 2018. This announcement has seen shares in the company jump 3.38pc to $10.09 in early trade on Tuesday.
BlueScope Steel Limited (BSL):
BlueScope Steel is eyeing a potential $960 million expansion of its North Star steel mill in Ohio in the United States after delivering its best annual profit since 2005. Australia's largest steelmaker lifted is final dividend 60 per cent and unveiled a $250 million share buyback after more than doubling its full-year net profit to $1.57 billion. Chief executive Mark Vassella said the group was in a very strong cash flow position and the time was right to step up investment in production in North Star, which has been a prime driver in fuelling profit gains which have delivered a near sixfold gain in the company's share price since mid-2015. BlueScope will make a decision in the second half of 2018-19 on whether to proceed with a proposed $US500 million to $US700 million expansion of North Star, which would take another two to three years to complete once the green light was given.
Challenger Ltd (CGF):
Investment manager Challenger says it booked record normalised net profit of $547 million for the year, driven by the growth in its customer base. Its Assets Under Management was up 16 per cent to $81 billion, what has grown by more than $36 billion in the past five years. Looking forward to the year to come it forecasts normalised pretax profit up between 8 to 12 per cent, despite changes in the fund environment. “While the low yield environment remains challenging, the outlook is supportive for Challenger. Demand for retirement income solutions is underpinned by accelerating growth in the number of retirees, the higher balances they are retiring with and the increasing length of their retirements,” it said.
Cochlear Limited (COH):
Cochlear has reported implant unit up 8 per cent for the year, catapulting it to net profit of $245.8 million, up 10pc on the previous. The figure was within its guidance range of $240m to $250m, what it said was the result of its investment in sales and marketing activities to build awareness. “In FY18, the business delivered manufacturing efficiencies from improvements in its warranty and repair functions. These gains were reinvested into our market growth activities with the net profit margin maintained,” chief Dig Howitt said. “We have a strong balance sheet and delivered operating cash flows in excess of net profit, enabling the business to fund capital investment, reduce debt and increase dividends to shareholders. ”That number is set to increase in the year ahead, Cochlear forecasting a net profit of $265m to $275m or an 8-12pc increase on today’s figures. It said solid cash flow generation supports a 14pc increase in the final dividend, with the full year dividends up 11pc.
Domino's Pizza Enterprises Ltd. (DMP):
Domino’s FY18 net profit of $121.5 million missed Bloomberg’s $130.7m estimate by 7 per cent. And it sees FY19 EBIT of $227m-$247m which is 8.2pc below the $252.7m midpoint of Bloomberg’s consensus range. Domino’s was the 5th most shorted stock in the top 100 as of last Tuesday with 15.16pc sold short. However this was down from about 18pc earlier this year and the share price has risen about 11pc in the past month. Disappointing results and guidance today, combined with the share price rise and reduction in shorts, could see Domino’s plunge today. Expect a test of the July low at $46.60 - 10 per cent lower - in early trading. If it breaks that point, the 200 day moving average at $46.07 will be key. Any move below the 200-DMA could trigger a further slide toward major support around $38-$40 in coming weeks.
iSelect Ltd (ISU):
Insurer iSelect has delivered underlying earnings of $8.5 million for the year as it works on a turnaround of the business back to profitability. In its results released this morning, it said the new senior executive team would be led longer term by former interim chief Brodie Arhnhold. The company reported a 2pc drop in revenues for the year to $181.4 million, driven by what it described as ‘ineffective marketing’ in health, energy and telco segments as well as general market volatility. “The challenges that our business faced in FY18 have tested the resilience of our team and our underlying business model,” new chief Mr Arnhold said. “We have refocused on our core capabilities centred around delivering our customers real value in their buying decision. We have also successfully rebalanced our marketing spend over the last quarter of FY18, and into FY19, to increase higher quality leads for a lower spend.”
National Australia Bank Ltd. (NAB):
NAB’s admission that net interest margin fell in the third quarter, is likely to weigh on banks today. While CBA’s net interest margin proved resilient in its results last week, the market will fear that NAB’s margin slippage may be the start of an industry-wide trend. “Cash earnings declined by 1 per cent, and compared to the prior corresponding period were down 3 per cent reflecting higher investment spend and credit impairment charges,” NAB said today. “Net interest margin declined slightly, reflecting elevated short term wholesale funding costs and ongoing intense home loan competition. “Expenses rose 2 per cent due to higher compliance costs, investment spend consistent with the accelerated strategy, and increased depreciation and amortisation.”
Whitehaven Coal Ltd (WHC)：
Whitehaven’s net profit, despite being a record at $525.6 million, missed analyst expectations of $538m, but this morning all share market eyes have been focused on the dividend, sending shares higher in early trading. At 11am, shares were up 38.5 cents, or 7.32 per cent, to $5.645, giving the Sydney-based coalminer a market value north of $5.75bn. “Quality core assets plus a whopping coal price tailwind have delivered WHC the cash flow spoils to retire debt and to finally reward patient dividend starved shareholders,” Shaw Stockbroking analyst Peter O’Connor said.
(Source: AIMS)
The a2 Milk company has renewed its strategic arrangements with China State Farm as the exclusive import agent for the company’s products into China. Today’s move will see the two entities extend their partnership for a further three-years from July 1, 2018. This announcement has seen shares in the company jump 3.38pc to $10.09 in early trade on Tuesday.
BlueScope Steel Limited (BSL):
BlueScope Steel is eyeing a potential $960 million expansion of its North Star steel mill in Ohio in the United States after delivering its best annual profit since 2005. Australia's largest steelmaker lifted is final dividend 60 per cent and unveiled a $250 million share buyback after more than doubling its full-year net profit to $1.57 billion. Chief executive Mark Vassella said the group was in a very strong cash flow position and the time was right to step up investment in production in North Star, which has been a prime driver in fuelling profit gains which have delivered a near sixfold gain in the company's share price since mid-2015. BlueScope will make a decision in the second half of 2018-19 on whether to proceed with a proposed $US500 million to $US700 million expansion of North Star, which would take another two to three years to complete once the green light was given.
Challenger Ltd (CGF):
Investment manager Challenger says it booked record normalised net profit of $547 million for the year, driven by the growth in its customer base. Its Assets Under Management was up 16 per cent to $81 billion, what has grown by more than $36 billion in the past five years. Looking forward to the year to come it forecasts normalised pretax profit up between 8 to 12 per cent, despite changes in the fund environment. “While the low yield environment remains challenging, the outlook is supportive for Challenger. Demand for retirement income solutions is underpinned by accelerating growth in the number of retirees, the higher balances they are retiring with and the increasing length of their retirements,” it said.
Cochlear Limited (COH):
Cochlear has reported implant unit up 8 per cent for the year, catapulting it to net profit of $245.8 million, up 10pc on the previous. The figure was within its guidance range of $240m to $250m, what it said was the result of its investment in sales and marketing activities to build awareness. “In FY18, the business delivered manufacturing efficiencies from improvements in its warranty and repair functions. These gains were reinvested into our market growth activities with the net profit margin maintained,” chief Dig Howitt said. “We have a strong balance sheet and delivered operating cash flows in excess of net profit, enabling the business to fund capital investment, reduce debt and increase dividends to shareholders. ”That number is set to increase in the year ahead, Cochlear forecasting a net profit of $265m to $275m or an 8-12pc increase on today’s figures. It said solid cash flow generation supports a 14pc increase in the final dividend, with the full year dividends up 11pc.
Domino's Pizza Enterprises Ltd. (DMP):
Domino’s FY18 net profit of $121.5 million missed Bloomberg’s $130.7m estimate by 7 per cent. And it sees FY19 EBIT of $227m-$247m which is 8.2pc below the $252.7m midpoint of Bloomberg’s consensus range. Domino’s was the 5th most shorted stock in the top 100 as of last Tuesday with 15.16pc sold short. However this was down from about 18pc earlier this year and the share price has risen about 11pc in the past month. Disappointing results and guidance today, combined with the share price rise and reduction in shorts, could see Domino’s plunge today. Expect a test of the July low at $46.60 - 10 per cent lower - in early trading. If it breaks that point, the 200 day moving average at $46.07 will be key. Any move below the 200-DMA could trigger a further slide toward major support around $38-$40 in coming weeks.
iSelect Ltd (ISU):
Insurer iSelect has delivered underlying earnings of $8.5 million for the year as it works on a turnaround of the business back to profitability. In its results released this morning, it said the new senior executive team would be led longer term by former interim chief Brodie Arhnhold. The company reported a 2pc drop in revenues for the year to $181.4 million, driven by what it described as ‘ineffective marketing’ in health, energy and telco segments as well as general market volatility. “The challenges that our business faced in FY18 have tested the resilience of our team and our underlying business model,” new chief Mr Arnhold said. “We have refocused on our core capabilities centred around delivering our customers real value in their buying decision. We have also successfully rebalanced our marketing spend over the last quarter of FY18, and into FY19, to increase higher quality leads for a lower spend.”
National Australia Bank Ltd. (NAB):
NAB’s admission that net interest margin fell in the third quarter, is likely to weigh on banks today. While CBA’s net interest margin proved resilient in its results last week, the market will fear that NAB’s margin slippage may be the start of an industry-wide trend. “Cash earnings declined by 1 per cent, and compared to the prior corresponding period were down 3 per cent reflecting higher investment spend and credit impairment charges,” NAB said today. “Net interest margin declined slightly, reflecting elevated short term wholesale funding costs and ongoing intense home loan competition. “Expenses rose 2 per cent due to higher compliance costs, investment spend consistent with the accelerated strategy, and increased depreciation and amortisation.”
Whitehaven Coal Ltd (WHC)：
Whitehaven’s net profit, despite being a record at $525.6 million, missed analyst expectations of $538m, but this morning all share market eyes have been focused on the dividend, sending shares higher in early trading. At 11am, shares were up 38.5 cents, or 7.32 per cent, to $5.645, giving the Sydney-based coalminer a market value north of $5.75bn. “Quality core assets plus a whopping coal price tailwind have delivered WHC the cash flow spoils to retire debt and to finally reward patient dividend starved shareholders,” Shaw Stockbroking analyst Peter O’Connor said.
(Source: AIMS)
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