Afterpay shares are up 13 per cent in early trade after the payment platform provided a business update to the market earlier today. In a note to investors Afterpay said its rollout in the US had been strong so far with over $115 million of underlying sales processed through its platform so far. Meanwhile, it said it was pushing into the local health sector with partnerships in dentistry and optometry retailers and now had 2.5 million active customers.
APA Group (APA):
APA Group shares are set to slide this morning after Josh Frydenberg effectively knocked back the growth ambitions of Hong Kong infrastructure giant CK Group and its $13 billion bid for the pipeline company. Shares in APA Group have plunged by 10 per cent in opening trade after news the government is likely to block its takeover by the Hong Kong infrastructure giant CK group. The stock fell as low as $8.425, last at $8.55. Yesterday afternoon, the Treasurer signaled that he will knock back the APA bid on national interest grounds, meaning the gas pipeline operator must try to regain momentum on longer-term plans that have been on hold since August, when the APA board approved the deal.
BHP Billiton Limited (BHP):
BHP chief executive Andrew Mackenzie expects the company's iron ore division to resume exporting in mid-November after a train derailment halted delivery to Port Hedland. Iron ore is BHP's most lucrative division, but the Western Australian business was brought to a shuddering halt this week when the company was forced to deliberately derail a train pulling 268 wagons full of iron ore after it departed without a driver.
Charter Hall Group (CHC):
Property powerhouse Charter Hall has locked in its position as the prime mover in Brisbane’s office market this year picking up a Mary Street tower in the central business district from QIC Global Real Estate for $275 million. The group, which grew its real estate funds empire to over $26 billion in the last quarter, has snapped a series of Brisbane properties this year and flagged further development plays. The building at 61 Mary Street is destined for the group’s unlisted Direct Office Fund, adding to its $1.5bn national portfolio, in a play flagged by The Australian last month. During a busy last quarter, DOF entered into a 50/50 joint venture with Western Sydney University for a new campus development in Parramatta and took a half stake in a building in Franklin Street in the Adelaide CBD for $135m. The latest acquisition will see the Charter Hall-run fund capitalize on the emerging Queensland government precinct near Queen’s Wharf and the Cross River Rail Albert Street Station.
Corporate Travel Management Ltd (CTD):
Shares in Brisbane-based Corporate Travel Management bounced this morning after the company issued a fresh rebuttal to attacks on it mounted by short-selling hedge fund VGI Partners. In a statement to the market this morning, Corporate Travel said VGI’s conclusions were based on “a fundamental misunderstanding of the corporate travel sector and the CTM business model” and drew on work done for it over the past fortnight by big four accounting firm to reject some of the fund’s specific allegations. Just before 11am the company’s shares were up almost 10 per cent, to $21.985 - a level that remained far lower than the $27.64 at which they were changing hands before VGI launched its attack a fortnight ago.
Domino's Pizza Enterprises Ltd (DMP):
After sharing its AGM update yesterday Domino’s Pizza was cut by UBS analysts, saying the chain had topped out. In a note, analyst Ben Gilbert said the company had outperformed the ASX200 Industrials by c24 per cent, and that it was now trading in line with its valuation. He cut the stock to Neutral but reiterated its guidance that a positive outlook at its next results were already priced in.
Fairfax (FXJ) and Nine Entertainment Co Holdings Ltd (NEC):
The ACCC have given approval to the merger of Nine Entertainment and Fairfax, opening the floodgates to create a $4 billion media giant. In an announcement this morning the consumer watchdog said the increase in online news would buffer any loss of market competition. In giving the greenlight this morning to the merger of broadcaster Nine Entertainment (Channel Nine owner) and Fairfax Media, the competition watchdog spends a bit of time looking at impact of changing media landscape due to impact of digital pressures. Beyond the final verdict, the Australian Competition and Consumer Commission chairman Rod Sims detailed the state of the media industry and its future. Shares in Nine Entertainment and Fairfax have jumped in morning trade at the news of ACCC approval for its merger, but they are still far off the highs seen at the deal’s initial announcement after a recent sell down.
James Hardie Industries plc (JHX):
Building materials supplier James Hardie has warned the market that its full-year result will be lower than consensus estimates, as it delivered a bumper first-half net operating profit. For the half year through September, net operating profit lifted 29 per cent to $US160m ($219m), up from $US123.8m last year. That news has sent its shares down 8.21 per cent to $18.18. The company declared an interim dividend of US10 cents a share unfranked, in line with last year’s first half dividend. James Hardie noted that analysts forecast net operating profit, excluding asbestos, to be within the range of $US313m and $US335m for the full year to March. But the company said today it expects net operating profit to be between $US280m and $US320m. That compares to the $US291.3m for the full year to March 2018.
McMillan Shakespeare Limited (MMS) and Eclipx Group Ltd (ECX):
McMillan Shakespeare is offering $912 million to buy Eclipx in a merger deal it will pay for with cash and scrip. The company released details of the deal today, where Eclipx (ECX) shareholders will be offered 0.1414 McMillan Shakespeare (MMS) share and 46c cash for each Eclipx share held. Shares in new takeover target Eclipx have surged 20 per cent in afternoon trade following the receipt of a merger deal from McMillan Shakespeare. McMillan Shakespeare and Eclipx are embarking on a merger deal that involves cash and scrip. Investment bank UBS is working for Eclipx while McMillan Shakespeare has Deutsche Bank as an adviser. Both companies are currently in a trading halt. McMillan Shakespeare and Eclipx are embarking on a merger deal that involves cash and scrip that is believed to value Eclipx at more than $886 million. Eclipx currently has a market value of $735m and was recently approached by another rival, SG Fleet, which made a scrip offer for the company that at the time valued the business at $805m.
NEWS CORP (NWS):
News Corp has highlighted growth in digital revenue across its newspaper and information division in its first quarter 2019 figures released a short time ago in New York. For the quarter to end-September digital revenues represented 33 per cent of News and Information Services segment revenues in the quarter, compared to 27 per cent in the prior year. New Corp’s top line numbers came in line with market expectations. News Corp, which publishes The Australian and mastheads including The Wall Street Journal and London’s The Times, posted a 23 per cent jump in revenue in the most recent quarter, thanks to the consolidation of its Australian television operations Foxtel as well as its investment in Australian digital real estate business REA and book publishing operations. The media company booked revenue of $US2.52 billion ($3.46 billion) for the first quarter. Net income surges 47 per cent to $US128 million from $US87 million a year earlier.
Pendal Group Ltd (PDL):
Stronger investment performance and foreign exchange gains helped global fund manager Pendal Group overcome increased outflows to post double digit profit and dividend increases. The former BT Funds Management posted a 30 per cent hike in statutory net profit to $191 million this morning, backed by big increases in base and performance fees for its $101.6 billion of funds under management. Fee revenue rose 14 per cent to $558.5 million, largely due to a 12 per cent increase in base management fees to $501.1 million, with the fee margin expanding by 1 basis point to 51 basis points. Pendal will pay a 30c final dividend, 15 per cent franked because of the high proportion of offshore earnings. That made 52c for the year, up from 45c for the year to the end of September 2017. Pendal said it booked net outflows of $3.7 billion, including $4.6 billion from the redemption of related to changes in the BT Financial Group MySuper portfolio, and $2.7 billion that walked from a UK portfolio following the retirement of a fund manager at the end of 2017.
REA Group Limited (REA):
Online property listing group REA Group Limited recorded a 17 per cent leap in revenue to $221.9 million in the first quarter but sounded a note of caution about the tough residential property market. The company, in which New Corp has holds a majority stake, also lifted core earnings before interest, tax, depreciation and amortization by 23 per cent to $130.9m. REA’s revenue lift was driven by its Australian residential business and the performance of its recently acquired Hometrack Australia and Smartline businesses. “Our strong results this quarter demonstrate, despite tougher market conditions, our customers and consumers are clearly seeing value in the products and experiences we are creating,” REA Group chief executive Tracey Fellows said. REA Group warned that market conditions were “not expected to improve in the short term” with the company warning that listings may be weaker in the lead up to the NSW election in March, while the impact of a federal election was “harder to predict”.
Telstra Corporation Ltd (TLS) and TPG Telecom Ltd (TPM):
The 5G spectrum auction is set to kick off on November 20, with the Coalition government sticking to its commitment of getting the asset into the hands of telecoms as quickly as possible. The auction will essentially be a two-horse race between Telstra and TPG Telecom/Vodafone Hutchison Australia, who are jointly bidding for the spectrum. The Australian Communication and Media Authority (ACMA) will put 125 MHz of available spectrum in the 3.6 GHz band on the block, with each bidder allowed to buy 60 MHz of the spectrum in metropolitan areas and 80 MHz in regional areas.
Xero Limited (XRO):
Accounting software outfit Xero’s losses have continued to widen, despite the New Zealand company posting strong sales and revenue growth for the six months to the end of September. Xero, which is now led by former Microsoft boss Steve Vamos, posted a net loss of $NZ28.6 million ($26.7m), up 46 per cent from $NZ19.6 million a year earlier. Revenue for the year was up 37 per cent to $NZ265.5 million, and EBITDA up to $NZ16.8 million, up from $NZ15.6 million a year earlier. The company also added 193,000 new subscribers during the half year, taking its total subscriber base to 1.579 million globally. Lifetime value per subscriber was up 6 per cent to $NZ2,494. Xero CEO Steve Vamos said the results were strong, with the acquisition of Canadian document collection and management software Hubdoc during the half set to help Xero’s clients to focus on less paperwork.