AGL Energy faces pressure to renegotiate its largest single electricity contract with the Tomago Aluminium plant in NSW which is struggling to turn a profit at current spot aluminium prices, Credit Suisse says. Tomago, the biggest user of energy in Australia, has seen its power costs increase by $290m since November 2017, partly due to a clause which means the manufacturer foots the bill for increased coal costs. Profitability at the Hunter Valley unit has halved in the last few years despite aluminum prices increasing 20 per cent since 2017, the broker estimates. “Such a decline in profitability warrants a response, and with efficiency opportunities limited, this leaves external assistance from AGL and the government,” Credit Suisse told clients. Tomago is owned by Rio Tinto, CSR and Hydro Aluminium.
Blue Sky Alternative Investments Ltd (BLA):
Embattled Brisbane-based investment empire Blue Sky Alternative Investments says Oaktree Capital Partners has appointed Mark Korda and Jarrod Villani of KordaMentha as receivers and managers of the Company. Bradley Hellen and Nigel Markey of Pilot Partners have also been appointed as voluntary administrators of the company. Blue Sky has also been suspended from trading on the ASX. It comes after Blue Sky’s recent revelations that it has breached covenants in a $50m funding deal with Oaktree. Blue Sky has been under immense pressure since March last year, when its share price was smashed by allegations from short-seller Glaucus Research that it had exaggerated its fee-earning assets under management and gouged its customers through excessive fees. As part of its efforts to stave off collapse, Blue Sky in September took a $50m loan from Oaktree, at a sky-high interest rate of 15 per cent, that the vulture fund can convert into up to 30 per cent of the company.
Elders Ltd (ELD):
Elders has posted a 34 per cent fall in the half year net profit to $27.4 million, citing drought conditions across much of Australia. Underlying earnings before interest and tax were also down, by 27 per cent to $33.5m. Elders also declared an interim dividend of 9c per share. Elders’ CEO Mark Allison said Elders remained committed to its growth plan “despite the very difficult conditions being experienced by the Australian agriculture sector, including many of Elders’ clients, in the first half of the year”. However, he said a return to average winter croppings was expected.
Incitec Pivot Ltd (IPL):
Incitec Pivot said first-half net profit rose sharply on the year-earlier period because of fewer asset writedowns, but that earnings fell because of operational challenges that included a rail outage and plant disruptions. The chemical and fertilisers company (IPL) on Monday reported a net profit of $41.9 million for the six months through March. That compared to a net profit of $7.6m in the same period a year earlier. Earnings before interest and tax, excluding material items, fell to $119m from $240m, it said. Incitec Pivot reported $141m in non-recurring charges that included a key rail closure in Queensland.
Lynas Corporation Ltd (LYC):
Lynas has inked an agreement with the Texas-based Blue Line to develop a rare earths facility in the US. Lynas informed the market it had signed an MOU for a joint venture with Blue Line to develop rare earths separation capacity in the US. The moves comes as Lynas, the largest producer of rare earth materials outside of China, is under pressure to shutter its existing separation facilities in Malaysia.
Murray Cod Australia Ltd (MCA):
Celebrity chef Heston Blumenthal is set to become a stakeholder in NSW-based inland aquaculture enterprise Murray Cod Australia. Murray Cod (MCA) announced on Monday a company associated with the Michelin-starred Blumenthal and his Fat Duck group will become a shareholder through the issue of 1.5 million fully paid ordinary shares. The value of the deal was not given, although Murray Cod Australia’s ASX-listed shares were worth 15.5 cents before trade on Monday — more than double their 6.1 cent of a year ago. Mr Blumenthal has separately signed a five-year deal to be an advocate for Murray Cod’s pond-grown Aquna Sustainable Murray Cod on social media and at industry events. “He will also provide assistance and advice with menu and product development,” Murray Cod said in a release to the ASX.
Scentre Group (SCG):
Scentre has sold a 50 per cent stake in Sydney’s Westfield Burwood shopping centre for $575 million. The deal with Perth-based Perron Group represents a 4.1 per cent premium to the centre’s $1.1 billion book value in last year’s annual report. “This transaction highlights the value of Scentre Group’s extraordinary platform of 41 Westfield living centres,” Scentre chief executive Peter Allen said. “The proceeds will provide the group with further capital to pursue our strategic objectives of creating long-term value forsecurityholders.” Scentre will use the proceeds to repay debt. The transaction is expected to be dilutive to funds from operations per security by approximately 0.2 cents per security over the full year, but Scentre’s forecast distribution remained unchanged at 22.60 cents per security.
（Source：AIMS）
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