Asaleo Care’s Shares Climbed Up On ASX Following The Favourable Market Sentiments On AHY’s Outlook

Asaleo Care’s Shares Climbed Up On ASX Following The Favourable Market Sentiments On AHY’s Outlook

Leading personal care and hygiene company, Asaleo Care Limited’s (ASX: AHY) stock climbed up 6.486 percent on February 04, 2019, owing to the positive market sentiments in relation to positive outlook ahead of the company. Although, the company has not announced any price sensitive information today.  [optin-monster-shortcode id=”swikrbu1d9j9aq0o4cko”]

In 1H 2018, the company reported revenue of A$267.2 million which was 9 percent less than the revenue in the corresponding previous period. During 1H 2018, the company reported a Gross profit of A$98.8 million which was 15 less than the previous corresponding period. The company’s underlying net profit after tax (NPAT) decreased by 36.9% to A$17.8 million in H1 2018 million as compared to A$28.2 million in H1 2017. For the half year 2018, the board declared no interim dividend.

The company’s Tissue segment experienced lower sales volumes and pulp and energy headwinds of around $10 million which could not be fully offset by cost out and price increases. During the period, the Personal Care earnings were lower in the company’s Feminine and Baby Care businesses. During the first half of 2018, the company had non-recurring charges of $148.5 million for impairment and write-down of assets in the company’s Tissue Australia and New Zealand Personal Care business.

The first half of 2018 was challenging for the company due to higher pulp prices and energy costs. As per recent market news, due to the recent decline in the pulp prices might support the company’s earnings for FY19.

In December 2018, the company announced the sale of its Australian Consumer Tissue business to Solaris Paper Pty Ltd which is involved in the distribution of high-quality toilet and tissue paper products throughout the Australasia region. The company is going to sell its Australian Consumer Tissue business for a total consideration of $180 million which will result in a book profit on the sale of between $15-20 million.  According to the company’s Chairman, Mr. Harry Boon, this sale will enable Asaleo Care to focus on its core, higher margin and less capital-intensive businesses in Personal Care and B2B (Business to Business).

It is expected that the proceeds from the sale will make the company’s balance sheet stronger and it will and improve the Company’s leverage ratio. After the completion of the sale, the Company is expecting its leverage ratio to be at the bottom of its target range of 1.5 x to 2.5x. In October 2018, the company announced the appointment of Sid Takla as the CEO and Managing Director of the company and the appointment of Andrew Blew as Executive General Manager Consumer Sales.

In the past six months, the share price of the company increased by 27.59 percent as on 1 February 2019. AHY’s shares traded at $0.985 (+6.486% intraday) with a market capitalization of circa $502.39 million as on 4 February 2019 (AEST 3:55 PM). It has 52 weeks high of $1.630 and 52 weeks low of $0.620.


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