Live News
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July 15, 2022 05:54 PM AEST
ASX 200 closes 0.68% lower, dragged down by Materials sector
Highlights:
- ASX 200 ends Friday session marginally lower, pulled by Materials sector.
- Defensive sectors, Consumer Staples, Healthcare and A-REITs clocked some gains.
- Falling iron-ore prices seem to have weighed heavily on metal and mining companies.
The benchmark ASX 200 index closed the week down 0.68% to 6,605.60 points. Yesterday’s gainers Materials, Telecom and Energy were today’s top losers. In fact, Materials sector was down 3.21% as iron ore and copper prices continued to fall. Meanwhile, defensive sectors - Consumer Staples, Health Care and A-REITs were on the gaining side. Over the week, the index has lost 1.08% and 9.96% in last 52 weeks.
Other noteworthy trends
Volatility indicator -A-VIX index was up 1.24% today. The All-ordinaries index followed the broader market trend falling 0.74%. Large cap representative, ASX 50 index (XFL) lost 0.548%. Mid-caps shown by Midcap-50 index and small caps by ASX Small ordinaries index lost 1.335% and 0.935% respectively.
Top gainers and losers on ASX 200
Image Source © 2022 Kalkine Media ®, data source- ASX website
Market movers
- Michael Hill (ASX:MHJ) shares gained 3.70% after the jeweller reported increased sales and expanded margins for the June quarter. The management claims it to be a remarkable achievement considering the ongoing challenges. Store sales grew 17% in the quarter and 7.3% y-o-y.
- On the gaining side, even WiseTech Global (ASX:WTC) shares were up 3.42% post lifting its annual earnings forecast. The pushing factor being a stronger top-line growth and improved cost savings.
- Investment manager Pendal’s (ASX:PDL) shares lost more than 7.8% after reporting worse than expected outflows of managed funds in June quarter. Pendal’s assets under management have dropped and investors have taken out AU$4.2 billion from the group.
- Shares of lottery operator Jumbo Interactive (ASX:JIN) plunged close to 15% after it shared that there was a lower jackpot activity in March and April 2022.
- ASX-listed iron-ore big-shots lost heavily due to the sliding iron ore prices. The dip in commodity price was attributed to the fall in Chinese GDP, its lockdown-hit property market and broader economy. BHP group shares (ASX:BHP) fell 3.48%, Fortescue metals (ASX:FMG) lost 6.2% while Rio Tinto (ASX:RIO) slid 2.85%.
In global markets:
Asian stock markets were brighter. Japan’s Nikkei Index and South Korea’s KOSPI closed higher. Chinese CSI and Shenzhen component indices followed along. Meanwhile, Hing Kong’s Hang Seng index closed lower. In the west, investors anticipate European stocks to open in green.
On commodities front:
Oil prices continued to rise on expectations of a less aggressive rate hike by US Fed. Both Brent and WTI were higher on Friday. Popular safe haven, Gold also firmed up with an eased dollar on uncertainty w.r.t US Fed’s interest rate hikes.
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July 13, 2022 06:04 PM AEST
ASX 200 gains 0.23%, energy stocks fall as oil prices slip
Highlights
- ASX 200 managed to add 0.23% by the end of today’s trading session on Wednesday.
- Telecom and Industrial stocks gained while Energy and Utilities sectors declined.
Australian share market witnessed an upbeat trend during Wednesday’s trade. The ASX 200 index added 0.23% to close at 6,621.60 points. Sectors painted a mixed picture on the index as commodity prices continued to be on losing spree due to growing global recession fears.
Seven of eleven sectors ended higher. Telecommunications Services and Industrials were the best performing sectors, closing 1.16% and 1.05% higher respectively. Energy sector closed 1.78% lower.
Since last five days, ASX 200 index has firmed up 0.41%, though still down 11.05% on a year-to-date basis.
Other noteworthy trends
Volatility indicator-A-VIX index was down 3.50%. However, the All-ordinaries index gained 0.31%. Large cap representative, ASX 50 index (XFL) was up 0.092%.
Top gainers and losers on ASX 200
Image Source © 2022 Kalkine Media ®, data source- ASX website
Market movers
- Core Lithium (ASX:CXO), one of Australia’s biggest lithium producers, was in news today as it has reported a significant increase in Mineral Resource Estimate (MRE) and Ore Reserve Estimate (ORE) for its Finniss Lithium Project, in the Northern Territory. Core shares closed Wednesday’s trade 2.34% higher.
- Fundie Platinum Investment Management (ASX:PTM), shared its funds under management (FUM) data, as of 30 June 2022. Platinum saw net outflows worth AU$304 million in June, the highest since February last year. PTM share price slipped 2.29% .
- ANZ Bank (ASX:ANZ) was also making headlines after confirming its discussions with Kohlberg Kravis Roberts for a potential acquisition of MYOB. ANZ share price shed off 1.19% today.
- TPG Telecom (ASX:TPG) shares gained attention as escrowed shares of its three largest shareholders became available for sale. Shares came out of escrow as the TPG and Vodafone’s merger completed two years. However, TPG share price lost 0.85% in Wednesday’s trade.
- In the top losing sector, Energy, a drop in oil prices has likely impacted shareholders. Energy majors Santos (ASX:STO) lost 1.29%, Beach Energy (ASX:BPT) shed 1.18% and Viva Energy Group (ASX:VEA) fell 2.85%.
In global markets:
Globally, investors are closely watching central banks on interest rates. In Europe, the first interest-rate hike in ten years is set to happen on 21 July. Meanwhile, today South Korea’s central bank joined its peers delivering a historic half-point interest rate hike to tame inflation. The Reserve Bank of New Zealand also delivered its third consecutive half-percentage-point hike.
In Asia-Pacific stock markets, Japan’s Nikkei index gained alongside South Korea’s KOSPI index. Even Chinese stocks were spotted trading higher on Wednesday. The Shanghai Composite Index gained and Hong Kong’s Hang Seng Index also firmed up.
On commodities front:
- Oil prices were down on Wednesday as investors anticipated a weak market, post release of US inflation data. Key benchmarks Brent and WTI remained low.
- Gold prices were shining brighter and even US dollar strengthened as markets anticipated the US CPI data and inflation number for June to hit a record high. Among other precious metals, Platinum followed gold upward while silver and palladium prices fell.
- In the crypto space, popular currency Bitcoin fell back below the prominent US$20,000 level yesterday evening. The second major cryptocurrency, Ether was also seen tumbling down.
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July 12, 2022 06:07 PM AEST
ASX 200 edges higher as defensive stocks gain; Zip Co outperforms
Highlights:
- ASX200 closes Tuesday’s trade slightly higher, pushed by healthcare and consumer staple stocks.
- Zip and Sezzle merger termination remained the highlight of today’s (12 July) trade on ASX.
- Global recession fears and inflation seems to be affecting the domestic and other economies.
Australian stocks closed slightly higher today, up just 4.10 points to 6,606.30. Tuesday’s trade partly recouped Monday’s losses with gains among Health Care, Consumer Staples, Utilities and Financials. Meanwhile, materials stocks continued to slide further. Even Telecom and IT stocks were looming lower. In last five days, the Australian index has lost 0.35%, down about 9.92% over the last 52 weeks.
Meanwhile, Westpac Melbourne Institute’s consumer sentiment index data was released today. The index showed a 3% decline in the consumer sentiment in July over last month, marking its seventh consecutive monthly fall. The main causes highlighted were increasing interest rates and surging inflation.
Other noteworthy trends
While Australian shares were edging slightly higher, Volatility indicator - A-VIX index gained 1.56%. However, the All-ordinaries index lost 0.08%. Large cap representative, ASX50 index (XFL) firmed up 0.301%. Meanwhile, mid-cap index ASX Midcap 50 and small-cap index ASX small ordinaries closed trade lower.
Top gainers and losers on ASX 200
Image Source © 2022 Kalkine Media ®, data source- ASX website
Market movers
- Making headlines today were two fintech firms on a terminated merger deal. Shares in Zip Co (ASX:ZIP) closed trade 6% higher after announcing termination of its merger with Sezzle. As a result, Sezzle (ASX:SZL) shares lost more than 38%. Zip Co will be paying Sezzle AU$16.3 million to cover costs associated with the deal.
- Eagers Automotive (ASX:APE) announced that its first-half profit might exceed guidance. Based on the news, APE share price managed to gain 3.31% during trade hours. Eagers stated that its statutory net profit through June was to beat its earlier forecast made in May. An improved outlook was shared despite the continuing supply constraints on new cars delivered.
- Another market mover was Costa Group (ASX:CGC) which closed 1.89% down after a volatile session. The food retailer responded to an ASX price query today after seeing elevated trading volumes on Monday.
- From the top gainer health care sector, CSL (ASX:CSL) gained 1.63%. Following along were other health care biggies Fisher & Paykel Healthcare (ASX:FPH) up 0.96% and Resmed Inc (ASX:RMD) gaining 2.08%.
In global markets:
Globally, investors seem to be keenly looking for more cues on US Fed’s interest rate hikes. Even in Europe the fight against inflation appears to be the current priority and a key market influencer. In Asia, stocks were losing as Japanese Nikkei fell along with South Korean KOSPI. With China detecting a new variant of omicron and possibilities of new round of lockdowns, China’s Shanghai Composite and Shenzhen Component closed lower. Even Hong Kong based Hang Seng index ended the session lower.
On commodities front,
- Oil prices were down as demand concerns were aggravated by the Chinese discovery of another omicron sub-variant. Oil benchmarks Brent and WTI retreated. Growing fears of a recession also continued to influence demand.
- Gold prices were slightly higher on Tuesday while US dollar continued to soar to a two-decade high. However, other precious metals including silver, platinum and palladium were eased.
- A glum global investor sentiment and monetary tightening measures have not even spared cryptocurrencies including Bitcoin.
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July 06, 2022 05:00 PM AEST
How are big 4 banks CAB, ANZ, NAB, WBC faring post RBA’s rate hike?
Highlights:
- Reserve Bank of Australia lifted its cash rate yesterday by 0.5bps, making it 1.35%.
- CBA and ANZ Bank have indicated an increase in their variable interest rates following the RBA’s cash rate hike.
The much-awaited cash rate hike was announced yesterday by Reserve bank of Australia, lifting the official interest rate third time in a month to make it 1.35%. The 0.5bps cash rate hike means a definite hike in borrowing rates if fully passed on by banks. Notably, today the first among Aussie big four banks to lift rates is the Commonwealth Bank of Australia (CBA). Following its lead, ANZ bank also announced to raise its variable interest rates.
Meanwhile on the ASX, the big four banks managed to book profits today after ending the sessions in red yesterday.
In this backdrop, we discuss the stock performance of Commonwealth Bank of Australia (ASX:CBA), New Zealand Banking Group Ltd (ASX:ANZ), National Australia Bank Ltd (ASX:NAB), and Westpac Banking Corporation (ASX:WBC).
Commonwealth Bank of Australia (ASX:CBA)
The first bank to announce a follow-on rate hike is Commonwealth Bank of Australia. CBA will be increasing its standard variable home loan rates up, by the same 0.5 percentage points. Reportedly, selected deposit rates will also rise , and the full rate increase will be only passed on to select depositors. Investors are speculating all other big four banks to follow CBA’s lead.
Meanwhile on ASX, CBA shares closed trade at AU$92.000 apiece, up 0.844%.
Australia and New Zealand Banking Group Ltd (ASX:ANZ)
Another big four bank that is creating headlines for hiking its rates is, Australia and New Zealand Banking Group Limited. As per media reports, ANZ will be offering higher interests on few term deposits from mid-July. It is likely to change its home loan rates around the same time. While the new rates haven’t become effective yet, the news has sparked investor’s interest towards the banker’s shares. ANZ share price ended up 0.900% at AU$22.400 apiece today.
National Australia Bank Ltd (ASX:NAB)
NAB share price gained 1.808% to close today’s trade at AU$28.150 apiece. This was in lack of any price sensitive announcements by NAB. The company has only been updating investors with its daily buy-back notifications in the recent past. However, since yesterday investors seem focused on determining the impact of RBA’s cash rate decision on bank’s stock performance.
Westpac Banking Corporation (ASX:WBC)
WBC share price closed 0.915% higher at AU$19.850 per share. According to a Canstar report, Westpac has been amongst the highest interest providers on savings accounts. However, unlike its peers, WBC has not yet made any announcements for a further increase in interest. It has not even raised its home loan rates.
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June 24, 2022 03:19 PM AEST
Are Fortescue (ASX:FMG) shares affected by commodity slump?
Highlights:
- Fortescue has lost more than 6% in last five trading days.
- The iron ore miner’s share price is likely getting affected by the commodity market upheavals.
- Fortescue is setting its foot into the green mining business via Fortescue Future Industries.
Weakness in commodity prices globally has started to take a toll on material and energy sector stocks. As the price of major raw materials like iron ore and copper are declining, the ASX200 Materials sector index (XMJ) has lost over 4.96% in last five days. Stocks have dipped 0.23% by noon and major companies like Fortescue Metals Group Ltd (ASX:FMG), Rio Tinto Ltd (ASX:RIO) and Champion Iron (ASX:CIA) are suffering.
FMG’s share price performance
Fortescue Metals Group's share price is down about 0.434% at 2:36 PM AEST today (24 June). In last five trade sessions FMG share price has lost more than 6%. FMG share price is tripping despite any new price sensitive announcements by the company recently. Meanwhile a major influencer seems to be the iron ore price.
What is wrong with Iron ore prices?
Image Source- © Xuejingwen | Megapixl.com
Iron ore prices have been lower since last few days. In a week’s time, the red metal’s price is down nearly 6%. The commodity price is weak amid global recessionary fears amongst commodity investors and the ongoing supply chain issues.
China is one of the largest importers of iron ore in the world. It consumes the red metal primarily to manufacture steel, of which it is a top exporter. Since the ongoing Covid situation is increasing the economic pressure on China, investors are keeping the red metal on their radar.
Also reportedly, China has indicated it may monopolise iron ore imports to cut down the industrial metal’s price. This would mean that China Iron and Steel Association joining hands with state-owned steel groups, to help both groups set lower prices.
The dragon, being a big-time iron importer, holds almost 70% share of the total global annual iron ore purchases. If China succeeds in implementing the plan, iron ore prices will probably move down further. It might also impact Fortescue shares as investors would perceive lower profits.
How is Fortescue moving ahead?
Fortescue Metals has previously declared a green transition in its business. The company revealed plans to change its leadership board and making Andrew Forrest AO as the Executive Chairman to oversee the business transition. Fortescue is hopeful about becoming a vertically integrated green energy business.
Recently, Fortescue Metals announced a partnership with global equipment manufacturer Liebherr for development and supply of green mining haul trucks. It was supposed to integrate with the zero emission power system technologies under joint development efforts of Fortescue Future Industries (FFI) and Williams Advanced Engineering (WAE). The agreement with Liebherr reportedly marked a significant step in the delivery of Fortescue’s industry leading decarbonisation targets.
The company seems to be slowly shifting focus toward the green mining industry. However, how far the transition can help Fortescue is one watch worthy scenario for investors in the long term.
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June 23, 2022 06:13 PM AEST
CBA, ANZ, NAB: ASX bank stocks to watch out for amid recession fears
Highlights
- RBA governor Lowe recently showcased his confidence on Australia’s resilience to faster rate hikes.
- ASX200 Banking index (XBK) has gained 1.11% in last five days.
- Stocks of big four banks - CBA, ANZ, NAB and WBC, along with peer MQG, appear on a recovery track.
Two days ago, RBA Governor Lowe signalled further rate hikes amid inflation and recessionary fears. However, he was confident on Australian economy’s ability to weather faster interest rate hikes. Investors anticipating recession, were cheered by RBA’s decision to base future rate hikes on economic indicators like household spends and employment rate.
Post Lowe’s speech, the sell-off in the banking sector appears to have paused. ASX200 Banking index (XBK) has went 1.11% up in last five days. In fact, on date of his speech (21 June), financial sector gained most on the ASX200 index.
Today the financial sector (XFJ) closed 0.732% higher on the ASX. Top Australian banks appear to be following the sectoral trend.
In this backdrop, let us look at the performance of National Australia Bank Ltd (ASX:NAB), Commonwealth Bank of Australia (ASX:CBA), Westpac Banking Corporation (ASX:WBC), Australia, New Zealand Banking Group Ltd (ASX:ANZ) and Macquarie Group Limited (ASX:MQG) on the ASX.
Commonwealth Bank of Australia (ASX:CBA)
Largest among the Australian big four banks is Commonwealth Bank of Australia. Its shares closed 0.200% up on the ASX today. While CBA shares were down over 14% in a month, it has gained 1.70% in last five days.
Westpac Banking Corporation (ASX:WBC)
Image Source © Lucidwaters | Megapixl.com
Westpac Banking Corporation’s share price closed today’s session at AU$19.620 apiece, up 0.460%. WBC share price has gained 3.65% in the last five days. Two days back, WBC also amended its Capital notes offering to facilitate a reinvestment option. Meanwhile, today the share price seems to be cheering the sectoral upside.
Australia and New Zealand Banking Group Ltd (ASX:ANZ)
ANZ shares closed 1.099% up at AU$22.070 apiece today. The banking group shares also appear tracing the banking sector index. While ANZ share price is down 13% over a one-month period, it has gained over 5% in last five days. Lacking any new ASX announcements ANZ share price seems to be faring well amid recessionary fears.
National Australia Bank Ltd (ASX:NAB)
Shares of National Australia Bank Ltd closed 0.518% up today. NAB share price has reversed some of the early losses and gained over 6% in last five trade days. While the company has only released its daily buy-back notification on ASX, NAB shares have bounced back to gains.
Macquarie Group Limited (ASX:MQG)
A peer to the big four Australian banks, Macquarie Group Limited closed 0.776% higher at AU$163.600 apeice today. In last month, MQG shares lost 8.51% however, it regained about 2.37% in past five days. MQG share price appears to be mainly tracing the recent banking sector trend. Recently it has also ceased to be a substantial holder in Charter Hall REIT. It has also completed a share allotment under the Macquarie Group Employee Retained Equity Plan (MEREP Awards).
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June 23, 2022 02:29 PM AEST
Growthpoint (ASX:GOZ) upgrades FY22 guidance, announces distribution
Highlights
- Growthpoint Properties has upgraded its Funds From Operations (FFO) guidance for FY22, showing at least 7.8% growth.
- The REIT group has also announced a distribution of 10.4 cents per share for the six months ending 30 June 2022.
- Given the positive update, GOZ share price has bounced back from its three-month low today.
Growthpoint Properties Australia (ASX:GOZ) has upgraded FY22 guidance today (23 June). The real estate investment trust (REIT) also announced distribution for six months ending 30 June 2022.
Growthpoint REIT invests in high-quality industrial and office properties across Australia. The update features upgradation to its FY22 funds from operations (FFO) guidance. Alongside, this company has also released a preliminary draft of external valuations of Growthpoint’s property portfolio.
Share price performance
Post this announcement, GOZ share price is up 3.244% from its previous close. Bouncing back from a three-month low, GOZ shares were trading at AU$3.50 at 11:52 AM AEST. In last one month, GOZ share price has lost about 8.38% while on year-to-date basis, it has lost more than 20%. As of date, Growthpoint holds a market capitalisation of AU$2.61 billion.
Key highlights
Image source: © 2022 Kalkine Media ®, Data Source-ASX announcement dated 23 June’22
FY22 Guidance upgrade
Growthpoint has upgraded its FY22 FFO guidance issued in December 2021. The guidance upgrade is around 27.7 cps, showing a minimum 7.8% growth over FY21. It is based on the assumption that there will be no significant market movements or unforeseen circumstances in the remaining financial year.
Details of external valuations of Growthpoint’s property portfolio
Growthpoint has reportedly engaged independent external valuers for revaluation of 30 of its 582 properties. These are almost 58% of the group’s portfolio in value terms as of 30 June 2022. As announced by the company, a preliminary draft of the external valuations indicates an AU$64.5 million uplift. It is a 2.2% increase in value from the book value as of 31 December 2021.
- The Group has revalued 17 of its 31 industrial assets, being 61% of its industrial portfolio. Value of the Group’s industrial portfolio has increased by AU$69.8 million, 7% higher from31 December 2021 book values. Rent growth is reportedly the driver for uplift.
- The company has also revalued 13 of its 27 office assets, being 56% of its office portfolio. Group’s office portfolio has notably decreased, by AU$5.3 million, 0.3% lower from book value on 31 December 2021.
However, these valuations are subject to finalisation and audit and as per the group there are chances of an upward or downward revision. The final audited valuations are expected to be a part of Growthpoint’s FY22 results, anticipated to be released by 16 August 2022.
Dividend distribution by Growthpoint
The REIT operator has announced a distribution of 10.4cps, for six months ending 30 June 2022. As of now the securities are to go ex-dividend on 29 June and the record date shall be 30 June 2022.
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June 22, 2022 06:06 PM AEST
QAN, FLT, WEB: What is pulling ASX200 travel stocks down?
Highlight
- The S&P/ASX200 is lower today, dropping 15.40 points or 0.24% to 6,508.40.
- Investors are wary of reduced consumer spending given future rate hikes and inflation.
- Travel stocks like QAN, FLT, WEB seem to be getting affected by the market sentiment.
The ASX200 index marked a loss of 0.29% on 22 June 1:00 PM AEST. The index, after yesterday’s bounce-back, has turned south. Sectors on the index, are however, showing a mixed picture. 6 of 11 sectors are lower today along with the S&P/ASX 200 Index. Utilities is the best performing sector.
One of the top losers today is the consumer discretionary sector that lost 1.13% overall.
Inflation and interest rate hikes are a big concern globally. Economies are predicted to go into recession, consumers might resort to cutting down expenses. Even businesses in the travel sector might face challenges like cost spikes. As a result, investors seem negative on the consumer discretionary sector stocks as of now.
In this backdrop we have covered some recent stock price changes of Qantas Airways Limited (ASX:QAN), Flight Centre Travel Group Ltd (ASX:FLT) and Webjet Limited (ASX:WEB) from the travel stocks segment of the consumer discretionary sector.
Qantas Airways Limited (ASX:QAN)
Australia’s popular airline operator, Qantas Airways Limited’s, share price shed 1.098% today. In last five trading days QAN shares have lost 7.02%.
The airline operator has been in news for facing staff shortages and luggage losses. However, what appears to be gripping investor sentiments, is the rising cost of fuel for Qantas. Fuel prices have surged since the Russian invasion on Ukraine began. Even before this, the company was facing challenges due to Covid-19 closures and a nationwide ban on international travel. As a result, on a YTD basis QAN shares are down over 12%.
Flight Centre Travel Group Ltd (ASX:FLT)
Travel and tour services provider, Flight Centre Travel Group Ltd. Buzzed in red zone today. FLT share price dipped 2.410% and closed at AU$17.810 per share.
In last five days, FLT share price has gained 0.91%. In last one year, the stock has gained 18.26% on the ASX.
Image Source © 2022 Kalkine Media ®
Webjet Limited (ASX:WEB)
Another notable ASX-listed travel industry stock is, Webjet Limited. The company is a digital travel business providing online booking services.
Webjet shares closed 2.010% down at AU$5.360 apiece today. In last one month, WEB shares have shed 10.37%. However, the stock has gained 5.51% in past year.
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December 31, 2020 11:22 AM AEDT
2020 a shocker of a year for dividend investors
Summary
- The Australian Prudential Regulation Authority (APRA) introduced dividend restrictions on the banking sector amid the pandemic.
- A significant proportion of Australian companies either slashed or deferred dividend payments.
- The Australian economy getting back on track is a positive sign for the dividend landscape.
The restrictions imposed to stall coronavirus’ massive transmission across the globe opened a can of worms for the business landscape. The restrictions triggered a dramatic decline in operations amid the pandemic. The repercussions were innumerable, stretching from the drop in revenues to an increased threat of survival while many companies slashed dividend to reserve liquidity.
Although the action helped the companies save significant amount of capital, it was a bolt out of the blue for the dividend investors. Notably, Australian companies have been a hot ticket for years, owing to the significant proportion of dividend they offer to the investors. The sudden cutback in income source, especially when health scenario was a wreck, eroded the ‘dividend-philic’ sentiments of many.
ALSO READ: 10 ASX-listed dividend stocks under the spotlight
To make the matter worse, the financial downturns exacerbated by job losses dealt another crushing blow to the stockholders. Nevertheless, the Australian economy is starting to look up and the improvement in job scenario and consumer sentiments has been a positive sign, not only for business settings but also for that chunk of additional income that dividend investors look for.
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In this backdrop, let us look at 2020’s dividend landscape of Australia.
Capping of Bank’s Dividend
The dividend income from Australian banks has been a pivotal element of many investors’ conservative strategy, who seek to manage their living costs through additional revenue stream without disturbing the underlying capital. However, the pandemic scenario and the associated uncertainties have affected the regulatory settings for the distribution of dividends.
APRA’s diktat to banks on prudent capital management capped dividend payments initially, wherein the dividend outflows were either deferred or offset to a considerable extent in order to maintain buffer. The focus was primarily on supporting the economy in times of crisis.
Nevertheless, with the improving scenario, the APRA guidance was updated in July-end, thereby easing restrictions on dividend payment. Thus, the banking sector was then required to maintain at least half of their earnings before making dividend-related decisions.
However, the outlook showing a significant upturn, has been typically encouraging for dividend income as APRA has removed limits on bank’s dividends. The decision to remove restrictions came in December, with the changes in the regulatory setting effective from 1 January 2021.
ALSO READ: How is the Banking Space Charting Out Revival Story in 2021?
Big Four Bank’s dividend. Source: ASX
Other Companies following Similar Cost-Saving Routes
While dividend limits predominantly capped dividend income from the banking sector, many other companies followed suit in order to maintain cash amid unprecedented times. Notably, dividend investing has gained massive popularity among Australian investors owing to its tax benefit. The dividends are not double taxed in Australia and the investors can enjoy tax benefit of the franked dividends.
However, the crisis ruptured the ideal dividend environment in Australia as around one-third of the Australian companies decided not to pay the dividend. It has affected the dividend yields of many, given their share price was able to bounce back from the bottom-mark.
A Dilemma about the Conservative Strategy
The pandemic managed to expose the risk associated with what was once regarded as one of the safest investment strategies. Over the years, investors’ hunt for high-dividend yield stocks has grown significantly, especially allowing self-funded retirees to receive a consistent flow of income. While the dividend investment strategy may consider the general underlying scenario, nevertheless, encapsulating risk-consideration of a catastrophe of this magnitude is highly unlikely. Since the pandemic is far from over, the prudent investment could involve a mix of diversification and value investment, with the focus on the current volatile scenario.
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September 01, 2020 01:03 PM AEST
iSentric Registers $6.4Mn in FY20 Revenue, Expenses Down by 52%
iSentric Limited (ASX:ICU), an advanced fintech and digital commerce software and services provider, has unveiled its preliminary final report for the period ended 30 June 2020 and important subsequent events.
Following are some of FY20 highlights:
- Revenue from ordinary activities stood at AU$6,445,109.
- Expenses noted a significant decline of 52% to AU$4,149,226.
- Cash flow for FY20 was steady and the Company raised AU$409,477 in July 2020 post a series of capital raisings.
Additionally, the Company sharpened its focus on core fintech business divisions of Mobile Banking and Digital Payments across Malaysia and Indonesia. ICU also highlighted important changes in the board and senior executive teams, rebranding of its mobile banking and payment processing platform to the IOU Pay Platform, and the renaming to IOU Pay (Asia) Sdn Bhd from Isentric Wireless Sdn Bhd.
Notably, the Company’s Extraordinary General Meeting of Shareholders is scheduled for 30 September 2020.
On 1 September 2020, ICU was trading at AU$0.073 at AEST (12:45 PM).
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August 31, 2020 05:37 PM AEST
Temple & Webster Reported Solid Results And Massive Growth In Active Customers During FY2020
Temple & Webster (ASX:TPW) has reported a 74% growth in its FY2020 revenue of A$176.3 million for the period ended 30 June 2020.
- EBITDA which was A$1.5 million in FY2019 increased to A$8.5 million.
- NPAT for the period was A$13.9 million.
- Active customers grew 77% to ~480k.
- Trade and Commercial division improved by 68% YoY.
- As of 27 August 2020, the company had A$81 million cash and has zero debt.
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August 31, 2020 12:43 PM AEST
Splitit Payments’ Sales Volume Up 133%, Reports Revenue of US$3.1 million
ASX-listed global payment solutions provider, Splitit Payments Limited (ASX:SPT) reported its financial results for the half-year (ended 30 June 2020) and provided its operational performance update.
- During FY20, Splitit witnessed record growth with Merchant Sales Volume of nearly US$89.1 million, which increased by 133% in H1 FY20.
- Gross Revenue (Non-GAAP) reported at US$3.1 million, up by 244% YoY.
- The Company signed 116 new merchants post period, including Frederique Constant, Echelon Fitness, Specialized, The Hut Group, and 77 Diamonds.
- During the period, SPT signed key partnerships with Stripe, Visa and Mastercard in H1 FY20 to hasten innovation and merchant acceptance.
Splitit anticipates rapid growth to continue in H2 FY20 and beyond.
On 31 August 2020, SPL share price was reported at A$1.890 up by 3.279% at AEST 12:37 PM.
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August 31, 2020 12:22 PM AEST
NAB Enters Into Agreement To Sell MLC Wealth To IOOF
National Australia Bank Limited (ASX:NAB) has signed a Sale and Purchase Agreement to sell 100% of MLC Wealth to IOOF Holdings Ltd for A$1,440 million.
The agreement follows the strategic decision announced by the company in 2018 to pursue an exit of MLC Wealth and is in line with the company’s strategy to simplify and focus on its core banking business, while creating a stronger future for MLC.
At AEST 11:46 AM, NAB shares are trading at A$18.04, up 0.613% from the previous close.
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August 31, 2020 12:22 PM AEST
Bubs Australia’s FY20 Results Out, Revenue Rose by 32%
Australian premium infant formula producer, Bubs Australia Limited (ASX:BUB) disclosed its annual report for FY20 (year ended 30 June 2020), highlights are-
- During the period, group gross revenue of BUB rose by 32% to A$62 million.
- Sales of Bubs® Infant Formula in FY20 increased 58% to A$30 million, representing ~55% group revenue.
- The Company has a robust balance sheet with approximately A$26 million in cash reserves.
- Bubs’ export markets outside China delivered 5-fold growth, indicating 10% group revenue.
The results during FY20 were driven by the robust performance of Bubs® Infant Formula in each retail regions and channels.
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August 28, 2020 05:10 PM AEST
California Approves Largest Utility Program To Expand EV Infrastructure
California approves USD 437 million to build EV chargers, an effort to expand the EV charging infrastructure.
- The approved fund would go to Southern California Edison to assist them in funding the installation of ~ 40,000 chargers – says the California Public Utilities Commission.
- Moreover, the program would further assist the state with its goal to put 5 million zero-emission vehicles on road by 2030.
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August 28, 2020 05:09 PM AEST
Bills Gates’ Venture Aims At Lowering Utilities Emission
TerraPower LLC- Bill Gates’ nuclear energy venture, hopes to build small advanced nuclear power stations which are able to store electricity in order to supplement grids supplied by intermittent renewable sources.
- The is part of the ongoing effort to help fight against the climate change with an aim to assist utilities to slash their emissions without undermining grid reliability.
- The venture by the billionaire philanthropist plans to commercialise stations called Natrium across the United States.
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August 28, 2020 01:41 PM AEST
Troy releases Financial results for FY20, Focuses on Exploration at Karouni Gold Operations
Troy Resources Limited (ASX:TRY), an experienced gold player, released the Annual Financial Report for the fiscal year ending on 30 June 2020. Troy produced over 23,580 ounces of gold in FY20 with least gold production from the December quarter during which the mining operations were temporarily ceased following an accident at the mine site.
Despite the pandemic, Troy ensured that the critical supplies remain unaffected by reduced freight flights into Guyana and gold produced continued to be transported to the refinery in Canada.
Here are the major key highlights from the financial report-
- Revenue - A$56.3 million
- Gold Sold - 23,726 Ounces
- AISC per oz (AuEq) - A$2,582
- Exploration Expenditure – A$7 million
- Capital Expenditure - A$15 million
- Cash and Bank Deposits - A$5 million
- EBITDA - A$(4) million
On 28 August 2020, Troy Resources traded at A$0.115 a share at 01:26 PM AEST, with a market capitalisation of A$75.85 million.
