Aristocrat Leisure Ltd (ALL):
Gaming machine maker Aristocrat has lifted full-year profit 9.6 per cent and upped its final dividend, despite increased competition and flat markets. For the full year to September 30, the company’s net profit after tax rose to $542.6 million. Earnings before interest, tax and depreciation and amortisation shot up nearly 32 per cent to $1.3 billion. “Aristocrat delivered strong, high quality earnings growth over the 2018 fiscal year, against a backdrop of mostly flat markets and increasing competitive pressures,” chief executive Trevor Croker said. “Pleasingly, the result was driven by strong organic growth across our land-based businesses and (social casino) Product Madness, driven by an increasingly broad and competitive product portfolio together with effective execution and a focus on customers and innovation.” The company declared a final dividend of 27 cents per share, fully franked, up from 20c a share last year.
Arrow Capital Partners (AMD):
The family office of billionaire mining scion and investor Angela Bennett has taken a stake in the Arrow Capital Partners private real estate platform and will support its ambitions to grow substantially in Europe, Australasia and Asia. The investment will bolster the firm, led by managing partner Martyn McCarthy, which is looking to capitalise on equity and debt real estate opportunities emerging locally and offshore, partly due to the dislocation in financial markets. The group’s focus, ranging from value-add to core-plus properties, will see it target office and industrial assets, along with select retail, hotel and residential projects.
Australia and New Zealand Banking Group (ANZ):
ANZ will have to pay compensation for two million accounts held by customers who have been ripped off by the bank, chief executive Shayne Elliott has told the financial services royal commission. Giving evidence yesterday, Mr Elliott said ANZ had taken far too long to discover, report and remediate customers when the bank had done the wrong thing. Commissioner Kenneth Hayne’s inquiry, which has torn like a wrecking ball through the financial services industry over the past 10 months, is in its final week of hearings, part of two-week round probing chief executives, chairmen and regulators about the policy issues confronting the sector. In other evidence yesterday, Mr Elliott said the bank’s board cut the bonuses of three ANZ executives this year because of scandals inside the lender and flagged a major overhaul of the entire organisation’s remuneration structure. Meanwhile, AMP acting chief executive Mike Wilkins — who steps down in favour of new boss Francesco De Ferrari tomorrow — defended the embattled wealth group’s vertically integrated model, putting him at odds with criticisms raised by his own customer advocate.
Bingo Industries Ltd (BIN):
The competition watchdog has raised concerns about Bingo’s proposed $577.5 million acquisition of Dial-aDump, saying the ASX-listed waste management company (BIN) would squash market share. The deal would make Bingo the largest building and demolition waste collection company in Sydney and diminish competition for processing, landfill and collections, according to the Australian Competition and Consumer Commission. Other facilities charge significantly more for heavy loads or are too far away to put price-pressure on Bingo, watchdog chair Rod Sims said in a statement on Thursday. “The acquisition would remove future competition between Bingo’s and Dial-a- Dump’s dry landfills, which may lead to higher gate fees than would be likely without the acquisition,” he said. “Competition between Sydney landfills is likely to become more important after the introduction of the Queensland landfill levy, which will make transporting waste to Queensland more expensive.” The industry relies heavily on the three levels of the supply chain — collection, processing and landfill — and affordable access to processing facilities is needed to compete for customers, ACCC says. The watchdog is investigating the vertical integration issues and invites submissions by 13 December before a decision expected on 19 February.
Harvey Norman Holdings Ltd (HVN):
Deutsche Bank analyst Michael Simotas believes the current Harvey Norman (HVN) share price isn’t giving credit for the company’s property portfolio and strong offshore results. The recent trading update at its AGM this week highlighted some improvement in Australia and a continuation of the very strong performance from offshore, a new report from Deutsche Bank said. The Australian business was down 1.1 per cent like for like in July/August but finished the period down only 0.2 per cent, implying 0.5 per cent like-for-like growth in the last two months. Total Group sales grew 2.7 per cent. “This was driven by very strong underlying sales growth from Asia, Europe and Ireland, boosted by a foreign exchange tailwind”. New Zealand has also remained robust. “Clearly Australia is not as strong as it was in the past, which we attribute to housing weakness but it is not a disaster and we expect strength from offshore (which is now a third of earnings) and resilience of property earnings to drive earnings growth at a group level. Deutsche Bank has retained its ‘buy’ rating.
Kogan Ltd (KGN):
Listed online retailer Kogan has jumped into the mortgage lending market, yesterday launching its latest vertical, Kogan Money Home Loans. Kogan said the move lent its brand and marketing engine to existing mortgage providers Adelaide Bank and Pepper Money to deliver a cheaper home loan for borrowers. “We effectively partner with incumbent institutions. We remove a lot of the layers of fat in the distribution chains because it’s an online offering, and as a result we can deliver customers a deal,” executive director David Shafer told The Australian. “These institutions don’t have to maintain expensive retail outlets in order to process these loans. we can leverage the efficiency associated with the online digital world in order to give a little bit more to the consumer in the form of a lower interest rate. “We have some of the most competitive interest rates available because of our model.” Kogan will offer fixed and variable home loans that offer the flexibility of an offset account, as well as a range of borrowing options, to customers including those looking to refinance.
National Australia Bank Ltd (NAB):
National Australia Bank became embroiled in a new pressure-selling scandal yesterday after it was caught using its “values” reward scheme to force its staff to “fill” its “funnel” with new loans before the Christmas break. The revelations of senior managers coercing frontline staff to sell more mortgages with the promise of internal reward points that can be redeemed for prizes came after NAB chairman Ken Henry and chief executive Andrew Thorburn received a drubbing at the banking royal commission over their failure to punish executives for bungling the bank’s relationship with regulators and dragging their heels over refunding customers’ fees where no service was provided.
Premier Investments Ltd (PMV) :
Billionaire retailer and chairman of Premier Investments, Solomon Lew, said the nation’s retail sector has been tarnished by the political instability emanating out of Canberra and has called for politicians to swap their short term partisan tactics for a long term focus on the nation’s economic challenges. Addressing the company’s shareholders at its annual general meeting this morning, Mr Lew also said Premier Investments (PMV) was looking at all its options to ensure the protection of its $100 million investment in Myer shares and is urging other Myer shareholders to take action at its AGM tomorrow and deliver a ‘second strike’ to the board. Mr Lew again called on Canberra to fix its problems, with the political upheaval and uncertainty not helping the fragile retail sector and business or consumer confidence. This was made worse by the rising cost of living and flat wages growth.
Qantas Airways Ltd (QAN):
Qantas stands to gain $170 million from the plunge in fuel prices taking significant pressure off the airlines’ bottom line. As the Qantas (QAN) share price climbed above $6 for the first time in two months, a note by market analysts Credit Suisse said the Flying Kangaroo was well placed to benefit from the 30 per cent fall in the fuel price. Analysts Paul Butler and William Park said since Qantas’ last trading update on October 25, jet fuel prices had fallen $21 a barrel. As a result, the estimated $4.09 billion fuel bill for the 2019 financial year was expected to come in at $3.92bn. The analysts noted that at the trading update, Qantas had 76 per cent of its fuel cost hedged, but with the opportunity to benefit from significant price falls. “With the flexibility of the hedging in place, we expect it to get a cost benefit across half of the fuel volume, equating to a $170 million benefit,” said Mr Butler and Mr Park.
QMS Media Ltd (QMS):
Australian listed outdoor advertising firm QMS has announced it that it has entered into an agreement for a proposed merger of its New Zealand operations with New Zealand broadcaster Mediaworks. The transaction is subject to agreeing final binding terms as well as several conditions to complete in the second quarter of next year. The transaction would see QMS merge its New Zealand out-of-home, digital media and production businesses into MediaWorks and in return would receive a material share of the company. It is understood QMS would own 40 per cent of the entity and Mediaworks the remainder. CLSA and UBS are working on the transaction. QMS said the proposed merge would create the largest multimedia group in New Zealand with out-of-home, radio, television and digital. “The future view of the media industry is consistent with recent international trends that place additional significant value on the power of multimedia ownership,” QMS said in a statement to the market today. It comes after The Australian’s DataRoom revealed on October 15 that QMS Media had submitted a proposal to acquire parts of the New Zealand broadcaster that owns free-to-air channels Bravo and TV3 along with the number one radio network in New Zealand, with 2.2 million weekly listeners and a limited number of outdoor advertising assets.
Rio Tinto Ltd (RIO):
Rio Tinto has sanctioned a larger than expected budget and capacity for its $US2.6 billion ($A3.5bn) Koodaideri iron ore mine in Western Australia, with first production expected in late 2021 as the global miner steps up efforts to replace depleting supplies. The 43 million tonnes per year project - slightly larger than the original 40m tonne scope - will include a new Pilbara production hub including a processing plant and 166-kilometre rail line connecting the mine to its existing network. The budget for the project has soared by $US400m since its original feasibility study estimate in November 2016. While that’s partly due to its larger capacity, Rio also flagged a cost jump for labour and materials had boosted the spend, along with added infrastructure including an airport. A further 27m tonnes of capacity could be added as part of Koodaideri phase 2 with a $44m pre-feasibility study approved, according to the miner, and a final investment decision hinging on the outcome of further studies.
(Source: AIMS)
Gaming machine maker Aristocrat has lifted full-year profit 9.6 per cent and upped its final dividend, despite increased competition and flat markets. For the full year to September 30, the company’s net profit after tax rose to $542.6 million. Earnings before interest, tax and depreciation and amortisation shot up nearly 32 per cent to $1.3 billion. “Aristocrat delivered strong, high quality earnings growth over the 2018 fiscal year, against a backdrop of mostly flat markets and increasing competitive pressures,” chief executive Trevor Croker said. “Pleasingly, the result was driven by strong organic growth across our land-based businesses and (social casino) Product Madness, driven by an increasingly broad and competitive product portfolio together with effective execution and a focus on customers and innovation.” The company declared a final dividend of 27 cents per share, fully franked, up from 20c a share last year.
Arrow Capital Partners (AMD):
The family office of billionaire mining scion and investor Angela Bennett has taken a stake in the Arrow Capital Partners private real estate platform and will support its ambitions to grow substantially in Europe, Australasia and Asia. The investment will bolster the firm, led by managing partner Martyn McCarthy, which is looking to capitalise on equity and debt real estate opportunities emerging locally and offshore, partly due to the dislocation in financial markets. The group’s focus, ranging from value-add to core-plus properties, will see it target office and industrial assets, along with select retail, hotel and residential projects.
Australia and New Zealand Banking Group (ANZ):
ANZ will have to pay compensation for two million accounts held by customers who have been ripped off by the bank, chief executive Shayne Elliott has told the financial services royal commission. Giving evidence yesterday, Mr Elliott said ANZ had taken far too long to discover, report and remediate customers when the bank had done the wrong thing. Commissioner Kenneth Hayne’s inquiry, which has torn like a wrecking ball through the financial services industry over the past 10 months, is in its final week of hearings, part of two-week round probing chief executives, chairmen and regulators about the policy issues confronting the sector. In other evidence yesterday, Mr Elliott said the bank’s board cut the bonuses of three ANZ executives this year because of scandals inside the lender and flagged a major overhaul of the entire organisation’s remuneration structure. Meanwhile, AMP acting chief executive Mike Wilkins — who steps down in favour of new boss Francesco De Ferrari tomorrow — defended the embattled wealth group’s vertically integrated model, putting him at odds with criticisms raised by his own customer advocate.
Bingo Industries Ltd (BIN):
The competition watchdog has raised concerns about Bingo’s proposed $577.5 million acquisition of Dial-aDump, saying the ASX-listed waste management company (BIN) would squash market share. The deal would make Bingo the largest building and demolition waste collection company in Sydney and diminish competition for processing, landfill and collections, according to the Australian Competition and Consumer Commission. Other facilities charge significantly more for heavy loads or are too far away to put price-pressure on Bingo, watchdog chair Rod Sims said in a statement on Thursday. “The acquisition would remove future competition between Bingo’s and Dial-a- Dump’s dry landfills, which may lead to higher gate fees than would be likely without the acquisition,” he said. “Competition between Sydney landfills is likely to become more important after the introduction of the Queensland landfill levy, which will make transporting waste to Queensland more expensive.” The industry relies heavily on the three levels of the supply chain — collection, processing and landfill — and affordable access to processing facilities is needed to compete for customers, ACCC says. The watchdog is investigating the vertical integration issues and invites submissions by 13 December before a decision expected on 19 February.
Harvey Norman Holdings Ltd (HVN):
Deutsche Bank analyst Michael Simotas believes the current Harvey Norman (HVN) share price isn’t giving credit for the company’s property portfolio and strong offshore results. The recent trading update at its AGM this week highlighted some improvement in Australia and a continuation of the very strong performance from offshore, a new report from Deutsche Bank said. The Australian business was down 1.1 per cent like for like in July/August but finished the period down only 0.2 per cent, implying 0.5 per cent like-for-like growth in the last two months. Total Group sales grew 2.7 per cent. “This was driven by very strong underlying sales growth from Asia, Europe and Ireland, boosted by a foreign exchange tailwind”. New Zealand has also remained robust. “Clearly Australia is not as strong as it was in the past, which we attribute to housing weakness but it is not a disaster and we expect strength from offshore (which is now a third of earnings) and resilience of property earnings to drive earnings growth at a group level. Deutsche Bank has retained its ‘buy’ rating.
Kogan Ltd (KGN):
Listed online retailer Kogan has jumped into the mortgage lending market, yesterday launching its latest vertical, Kogan Money Home Loans. Kogan said the move lent its brand and marketing engine to existing mortgage providers Adelaide Bank and Pepper Money to deliver a cheaper home loan for borrowers. “We effectively partner with incumbent institutions. We remove a lot of the layers of fat in the distribution chains because it’s an online offering, and as a result we can deliver customers a deal,” executive director David Shafer told The Australian. “These institutions don’t have to maintain expensive retail outlets in order to process these loans. we can leverage the efficiency associated with the online digital world in order to give a little bit more to the consumer in the form of a lower interest rate. “We have some of the most competitive interest rates available because of our model.” Kogan will offer fixed and variable home loans that offer the flexibility of an offset account, as well as a range of borrowing options, to customers including those looking to refinance.
National Australia Bank Ltd (NAB):
National Australia Bank became embroiled in a new pressure-selling scandal yesterday after it was caught using its “values” reward scheme to force its staff to “fill” its “funnel” with new loans before the Christmas break. The revelations of senior managers coercing frontline staff to sell more mortgages with the promise of internal reward points that can be redeemed for prizes came after NAB chairman Ken Henry and chief executive Andrew Thorburn received a drubbing at the banking royal commission over their failure to punish executives for bungling the bank’s relationship with regulators and dragging their heels over refunding customers’ fees where no service was provided.
Premier Investments Ltd (PMV) :
Billionaire retailer and chairman of Premier Investments, Solomon Lew, said the nation’s retail sector has been tarnished by the political instability emanating out of Canberra and has called for politicians to swap their short term partisan tactics for a long term focus on the nation’s economic challenges. Addressing the company’s shareholders at its annual general meeting this morning, Mr Lew also said Premier Investments (PMV) was looking at all its options to ensure the protection of its $100 million investment in Myer shares and is urging other Myer shareholders to take action at its AGM tomorrow and deliver a ‘second strike’ to the board. Mr Lew again called on Canberra to fix its problems, with the political upheaval and uncertainty not helping the fragile retail sector and business or consumer confidence. This was made worse by the rising cost of living and flat wages growth.
Qantas Airways Ltd (QAN):
Qantas stands to gain $170 million from the plunge in fuel prices taking significant pressure off the airlines’ bottom line. As the Qantas (QAN) share price climbed above $6 for the first time in two months, a note by market analysts Credit Suisse said the Flying Kangaroo was well placed to benefit from the 30 per cent fall in the fuel price. Analysts Paul Butler and William Park said since Qantas’ last trading update on October 25, jet fuel prices had fallen $21 a barrel. As a result, the estimated $4.09 billion fuel bill for the 2019 financial year was expected to come in at $3.92bn. The analysts noted that at the trading update, Qantas had 76 per cent of its fuel cost hedged, but with the opportunity to benefit from significant price falls. “With the flexibility of the hedging in place, we expect it to get a cost benefit across half of the fuel volume, equating to a $170 million benefit,” said Mr Butler and Mr Park.
QMS Media Ltd (QMS):
Australian listed outdoor advertising firm QMS has announced it that it has entered into an agreement for a proposed merger of its New Zealand operations with New Zealand broadcaster Mediaworks. The transaction is subject to agreeing final binding terms as well as several conditions to complete in the second quarter of next year. The transaction would see QMS merge its New Zealand out-of-home, digital media and production businesses into MediaWorks and in return would receive a material share of the company. It is understood QMS would own 40 per cent of the entity and Mediaworks the remainder. CLSA and UBS are working on the transaction. QMS said the proposed merge would create the largest multimedia group in New Zealand with out-of-home, radio, television and digital. “The future view of the media industry is consistent with recent international trends that place additional significant value on the power of multimedia ownership,” QMS said in a statement to the market today. It comes after The Australian’s DataRoom revealed on October 15 that QMS Media had submitted a proposal to acquire parts of the New Zealand broadcaster that owns free-to-air channels Bravo and TV3 along with the number one radio network in New Zealand, with 2.2 million weekly listeners and a limited number of outdoor advertising assets.
Rio Tinto Ltd (RIO):
Rio Tinto has sanctioned a larger than expected budget and capacity for its $US2.6 billion ($A3.5bn) Koodaideri iron ore mine in Western Australia, with first production expected in late 2021 as the global miner steps up efforts to replace depleting supplies. The 43 million tonnes per year project - slightly larger than the original 40m tonne scope - will include a new Pilbara production hub including a processing plant and 166-kilometre rail line connecting the mine to its existing network. The budget for the project has soared by $US400m since its original feasibility study estimate in November 2016. While that’s partly due to its larger capacity, Rio also flagged a cost jump for labour and materials had boosted the spend, along with added infrastructure including an airport. A further 27m tonnes of capacity could be added as part of Koodaideri phase 2 with a $44m pre-feasibility study approved, according to the miner, and a final investment decision hinging on the outcome of further studies.
(Source: AIMS)
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