4 ASX Stocks Under the Spotlight Last Week- JB Hi-Fi, Suncorp, Nearmap & Redbubble - Kalkine Media

August 24, 2020 01:24 PM AEST | By Team Kalkine Media
Follow us on Google News:

Summary

  • The Australian sharemarket finished an action-packed week of profit results with a 0.2% decline on 21 August 2020.
  • The S&P 200 index remained well below its peak of 7197.2 on 20 February 2020.
  • Experts opine that investors are coming to grips with a dismal reporting season with most companies guiding towards a weaker FY21.
  • In a dismal year for business, a handful did shine on the back of robust business continuity plans.
  • For instance- JB Hi-Fi, Suncorp, Nearmap & Redbubble released their earnings reports last week, demonstrating resilience in the face of the pandemic.

“Investing is not supposed to be easy”, said the great Charlie Munger. COVID-19 inflicted market downturn is proving the same for investors, both domestic and global. However, as Munger’s close ally Warren Buffett said, “Games are won by players who focus on the playing field”, investors are battening down the hatches on what they wish to invest in, as the reporting season continues.

21 August 2020, the third Friday of the month, saw the S&P/ASX200 Index tumbling 8.8 points, or 0.14 %, to 6111.2 points. Prime drivers of the negative week included a flurry of coronavirus-hit earnings reports.

On Friday, blue chip leaders CSL (down 1.5%), Commonwealth bank (ASX: CBA) and BHP (both down 0.9%) overshadowed the few solid performances that were reported.

For more insight on the market performance, PLEASE READ: Market Close Commentary; 21 August 2020

Moving on, let us walk through four ASX200 stocks that seemed to have been under the radar over the past week-

Kalkine Image (Source: Company reports)

Kalkine Image (Source: Company reports)

JB Hi-Fi Limited: “This is a strong result in the most challenging of times”, says CEO, Richard Murray

JB Hi-Fi Limited (ASX:JBH), brings together two of Australia’s most trusted and renowned retail brands, JB Hi-Fi and The Good Guys. On 17 August 2020, the Group reported its FY20 results, provided FY21 outlook and released its First Sustainability Report-

  • Total sales up 11.6% to $7.9 billion.
  • ~ $600 million in online sales up c.50% YoY, with Q4 up 134%.
  • Underlying EBIT up 30.5% to $486.5 million.
  • Underlying NPAT up 33.2% to $332.7 million.
  • Underlying EPS up 33.2% to 289.6 cps.
  • Final dividend up 76.5% to 90 cps and total FY20 dividend up 33.1% to 189 cps.

The Group is pleased with its start to FY21. In July 2020, total sales growth for JB HI-FI Australia was 42.1%. JB HI-FI New Zealand saw 9.1% growth, while The Good Guys witnessed 40.4% growth.The Group saw a significant acceleration in online sales in Q4, up 134% on the pcp.

MUST READ: All Ordinaries: Kogan Share Price Takes Hit, JB Hi-Fi Delivers Jumbo Profit

Suncorp Group Limited: “Group has solid foundations”, says CEO Steve Johnston

Suncorp Group Limited (ASX:SUN) offers insurance, banking, wealth products and services via few Australia and New Zealand-based recognised financial brands. COVID-19 had ~ $140 million pre-tax negative impact on the Group’s FY20 result. The overall financial performance, particularly in the second half, has not been immune from the negative impacts of COVID-19. For instance, cash earnings for FY20 were down 32.8% at $749 million.

However, there were several highlights which demonstrate that the Group has solid foundations-

  • Group NPAT for FY20 was $913 million, up $738 million or 421.7% on the pcp.
  • Group remains well capitalised with excess common equity tier 1 of $823 million.
  • Recently, the Group confirmed a new leadership team structure.
  • Digital channels helped drive favourable growth in Australian motor and home insurance portfolios.
  • Natural hazard costs remained in-line with an allowance of $820 million as a result of Group’s strengthened reinsurance program.

The Group has increased its FY21 natural hazard allowance by $130 million to $950 million. It has also purchased an Aggregate Excess of Loss reinsurance cover that provides $400 million of cover for events in excess of $5 million once the retained cost of these events reaches $650 million.

Besides, CEO Mr Steve Johnston reaffirmed his confidence in the Group’s ability to deliver sustainable shareholder returns over the long-term. Though economic uncertainty dominates, the Board remains committed to its long-standing ordinary dividend payout ratio policy of 60-80% of cash earnings.

Nearmap Limited: “FY20 was yet another landmark year”, says CFO Andy Watt

Nearmap Limited (ASX:NEA) is a location intelligence company capturing data about the real world and offers insights to a diverse range of businesses. Amid ongoing significant economic uncertainty, the Company’s unique value proposition was strengthened, evident from an improvement in the retention and continued growth in its Annualised Contract Value (ACV). Below are some result highlights:

  • During FY20, NEA added $16.2 million of incremental ACV to close the year at $106.4m, representing 18% YoY growth and well within the $103-$107 million guidance range.
  • Group Revenue grew 25% on the prior year to $96.7 million.
  • NPAT loss was $36.7 million, up $21.8 million from the $14.9m loss posted in the previous year.
  • Costs of revenue grew 63% as the capture program was extended and amortisation was accelerated via the P&L following the prior year change to amortisation period.
  • The Group closed headcount of 284, only 12 higher than it was at the end of FY19.

In FY21, three verticals will continue to be a key focus for Nearmap- Roofing, Insurance and Government, that now account for 40% of Group ACV. The Group is targeting 20-40% ACV growth medium to long term, and underlying churn <10%. It expects a closing FY21 Group cash balance to be between $32-$35 million.

Redbubble Limited: “2021 represents a year of opportunity for the business”, says CEO Martin Hosking

Redbubble Limited (ASX:RBL) aims to create a large marketplace for independent artists and bring more creativity into the world. Below are key highlights for the year ended 30 June 2020 –

  • Marketplace Revenue was $349 million, up 36%.
  • Gross profit was $134 million, up 42%.
  • Operating EBITDA was $15.3 million, up 141%.
  • Closing cash balance on 30 June 2020 was $58 million.
  • Fulfillment capacity was added in Europe, Canada and the United States.
  • Operating expenses for the year were $79.3 million.

Besides, during 4Q20, growth and profitability accelerated with marketplace Revenue of $103 million, Gross profit growing 88%, operating EBITDA of $8.4 million (relative to 4Q19). Moreover, FY21 has started strongly with July Marketplace Revenue growth of 132% (133% on a constant currency basis) and similar sales levels in the first two weeks of August.

CEO, Martin Hosking opines that the Company is positioned to build on a decade of momentum and aggressively pursue the global opportunity presented by the shift to online activity and increasing adoption of ecommerce platforms.

MUST READ: 255% share price run in 3 months, What’s next for this ASX Growth Stock – Redbubble

Stock Performance

Source: ASX


Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.



Top ASX Listed Companies

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK