- By successfully accessing the US debt capital markets and due to solid aid received from its relationship banks, Boral has managed to grow its liquidity and debt maturity.
- Despite the COVID-19 epidemic, Austal experienced solid performance in Shipyards in Philippines, Australia, Vietnam, and the US region.
- A strong balance sheet provides adequate support to a company in enduring the recession period.
- Southern Cross Media Group solidifies its balance sheet and reduced its net debt by utilising the proceeds of the recently concluded equity raising.
At the close of the trading session on 1 June 2020, the benchmark index S&P/ASX200 witnessed a rise of 63.5 points or 1.10% to stand at 5819.2. Apart from that, S&P/ASX200 Materials (Sector) also finished higher by 3.34% to be at 13,413.8 points. Keeping the momentum alive, S&P/ASX200 Industrials (Sector) was at 5,864.6 points, increasing by 0.68% from its last close.
However, S&P/ASX200 COMMUNICATION SERVICES (SECTOR) by the close of the market session was in red at 1,176.5 marginally down by 0.26%. S&P/ASX200 Financials (Sector) closed the day in green as well at 4,604.1 points or 0.27% from its last close. S&P/ASX200 Information Technology (Sector) also ended the market session 0.4% up at 1,488 points.
We have screened five best performers on ASX from different sectors. Let us have a look at the five stocks with their recent updates.
Boral Limited (ASX:BLD) is engaged in the manufacturing and supply of building and construction material.
On 1 June 2020, BLD notified the market on the conclusion of USPP or US Private Placement note issue of US$ 200 million, along with execution of the Company’s new bilateral 2 years back loan facilities amounting to $365. BLD also finalised the (new bilateral loan facilities) amounting to US$ 740 million (to mature in June 2024) as was notified by the Company earlier on 15 May 2020.
Recently in May, the Company responded to a media article published in The Australian, which stated that “Boral faces $700 million US suit from the former owner of its windows division”. However, the Company stated that BLD has been in litigation in Texas (USA) with Billy Robinson, prior owner of the Windows business since October 2018.
BLD contended that Robinson breached his non-competition covenants after his departure from the Windows business in July 2017. The company added that Robinson asserted an exorbitant damage claim to gain headlines and distract from his own conduct and Boral’s claims.
The Company has recently increased and extended its debt financing facilities by undertaking a number of measures:
- BLD issued US$200 million new US Private Placement (USPP) note.
- Approvals for new bilateral two-year bank loan facilities amounting to $365 million.
- Approvals to extend US$665 million of its existing US$750 million debt facility from July 2021 to June 2024.
The stock of BLD closed the day’s trading session at $3.32 per share on 1 June 2020, indicating a rise of 6.752% against its previous closing price. The stock of BLD provided shareholders with a return of 14.34% in past 5-day period.
Austal Limited (ASX:ASB) is in the designing, manufacturing, and support of high-performance vessels for commercial and defence customers worldwide.
Austal recently notified the market with an update, wherein, it upgraded its earnings guidance. As of now, the Company expects group revenue of around $2.0 billion as compared to previous guidance of at least $1.9 billion. ASB anticipates EBIT of minimum $125 million against prior guidance of at least $110 million.
The resilient performance throughout its shipyards in the Philippines, Australia, USA and Vietnam during the COVID-19 period has supported the company to upgrade its guidance for FY20.
The stock of ASB closed the day’s trading session at $3.650 per share on1 June 2020, signifying an increase of 9.281% against its previous closing price. The stock of ASB has provided shareholders with a return of 15.17% in past five days.
Southern Cross Media Group Limited
One of the country’s leading media house, Southern Cross Media Group Limited (ASX:SXL) has its reach beyond 95 percent to the citizens of Australia via its medium of tv, radio and digital assets. The Company broadcasts ninety-two free to air television signals throughout the nation.
SXL recently winded up an equity raising of around $169 million (before transaction costs). The equity raising was comprised of a placement to institutional and sophisticated investors and a 1.75 for 1 accelerated pro-rata non-renounceable entitlement offer of fully paid ordinary shares in SXL. The Company would utilise the proceeds to decrease net debt levels as well as to finance transaction costs. As at 4th May 2020, the net debt of the company stood at $161.8 million.
The Company attained positive EBITDA in April 2020. Revenue declines were partially offset by operating cost reductions.
The stock of SXL closed the day’s trading session at $0.225 per share on 1 June 2020, decreasing by 4.255% from its last close. However, the Company’s stock has provided shareholders with a return of 46.87% amid the duration of last 5 days.
Virgin Money UK PLC
Virgin Money UK PLC (ASX:VUK) provides services to around 6.4 million consumers throughout the United Kingdom via a digital first approach providing both online and mobile services aided by telephone and branch banking method.
Recently in May, the Company notified the market with the operational and financial performance for 1H FY20, wherein, it stated that the balance sheet mix optimisation continued with loan growth of 0.3% to £73.2 billion and deposit growth of 1.4% to £64.7 billion.
VUK reported pre-provision operating profit amounting to £352 million, reflecting a fall of 3% on a year-on-year basis due to the expected Net Interest Margin (NIM) compression. NIM for the period stood 1.62%, which was within the guidance range.
The Company is well-placed for an ambiguous period with a defensive loan book of 82 percent in high-quality mortgages, 11 percent in diversified Business lending sans material exposures to the more instantly affected sectors and 7 percent Personal lending, mainly in prime and high-quality credit cards.
The stock of VUK closed the day’s trading session at $1.755 per share on 1 June 2020, with a fall of 2.77% against its previous closing price. The stock of VUK has provided shareholders with a return of 21.55% during the period of last 5 days.
Perth based Nearmap Ltd (ASX:NEA) offers companies with immediate access to high resolution aerial imagery. NEA aids its consumers conduct virtual site visits to gain in depth and data driven understandings.
In a recent trading update, the Company announced that the ACV (Annualised Contract Value) is growing and currently, it is topping $102 million. On 1st June 2020, the Nearmap AI was supposed to be launched and commercially be available via self-service export and offline channels in Australia and the USA.
The Company executed numerous cash management initiatives, and it is on track to achieve cash flow breakeven by 30th June 2020. For FY20, the Company anticipates closing cash balance in the range of $32 million- $35 million.
The stock of NEA closed the day’s trading session at $2.190 per share on 1 June 2020, reflecting a decline of 4.367% against its previous closing price. The stock of NEA has provided shareholders with a return of 18.04% during the last 5 days.
There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.
Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.
As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.