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Summary
- Ever since the beginning of Covid-19 pandemic, global stock markets have been experiencing its wrath.
- Due to prolonged uncertainty, the market has been going topsy-turvy. Unless some medical breakthrough happens, businesses and stock markets are expected to be on a roller coaster ride.
- Some stocks are buzzing today like Firefly Resources (ASX:FFR)traded higher by 35.294 per cent.
- FFR reported high-grade gold hits at Yalgoo, while Dicker Data (ASX:DDR) registered a 24.8 per cent increase in FY20 gross profit.
- Coles Group (ASX:COL) would be added to S&P/ASX 20 Index, and Webjet Limited (ASX:WEB) would roll out a new long-term incentive plan.
Global markets, including the Australian stock market have been fluctuating ever since the pandemic began. The market has been highly volatile and sensitive due to the prolonged crisis. The scenario is such that one day it is up and another day, it is down.
On 10 September 2020, the Australian stock market ended in green zone with a 0.51 per cent gain, settling at 5908.5. However, on 11 September 2020, the benchmark index S&P/ASX200 traded downward by 0.83 per cent to 5,859.4.
In that backdrop, let us discuss latest market updates of few ASX-listed companies.
Firefly Resources Intersected Spectacular High-Grade Gold Mineralisation at Yalgoo
On 7 September 2020, gold exploration company, Firefly Resources Ltd (ASX:FFR) announced spectacular gold hits from initial drill program at its Yalgoo Gold Project in WA.
Located 175km east of Geraldton, the project encompasses a 600km2 tenement package that covers a goldfield with the history of top-grade gold production. However, it has not undergone exploration for the past 15 years.
In its maiden Reverse Circulation (RC) drilling program, outstanding results have been delivered. Assay results from drilling at the Melville Deposit included:
- 6 metres at 244.9g/t from 50 metres that included 1 metre at 1,439.55g/t from 51 metres and 1 metre at 16.95g/t from 55 metres, 14 metres at 1.00g/t from 58 metres including 1 metre @ 2.61g/t and 1 metre @ 3.73g/t, and 2 metres @ 1.06g/t from 106 metres to end-of-hole (in a mineralised porphyry unit) - FMRC0008;
- 13 metres at 3.65g/t from 113 metres including 4 metres at 9.19g/t from 119 metres - FMRC0010;
- 9 metres at 1.32g/t from surface including 1 metre at 4.76g/t from 7 metres, 1 metre at 3.49g/t from 96 metres, 2 metres at 1.87g/t from 101 metres and 1 metre at 2.66g/t from 105 metres - FMRC0009;
- 4m @ 1.24g/t from 3 metres and 1 metre at 5.76g/t from 69 metres - FMRC0007.
In the coming week, remaining assays are expected. Moreover, next phase of the multi-pronged, 10,000m RC drilling program is set to resume shortly.
On 11 September, FFR traded higher by 35.294 per cent to AUD 0.230. It is a small-cap stock with a market capitalisation of AUD 43.7 million. The stock has delivered a whopping return of 595.96 per cent in the last six-month period.
Also Read: Gold Hits life highs: Eight ASX-listed Gold Stocks Under Sentiment Splash
Coles Group Added to S&P/ASX 20 Index, AUD 450Mn Worth Notes Priced
As per the September 2020 Quarterly Rebalance of the S&P/ASX Indices by S&P Dow Jones Indices, Coles Group Limited (ASX: COL) will be added to S&P/ASX 20 Index, effective at the open on 21 September 2020.
Must Read: How Coles Became One of The Top ASX 100 Stocks Being Watched?
On 11 September 2020, the company released an update on distribution of AUD 0.2750 to be paid on 29 September 2020. The update is related to DRP Price, which says that the offer price will be calculated as the arithmetic average of the daily VWAP of Coles' shares for 5 trading days starting on 4 September 2020.
In August 2020, Coles Group announced that Coles Group Treasury Pty Ltd (ACN 628 634 935), its 100 per cent owned subsidiary, priced Australian dollar medium-term notes (Notes) worth AUD 450 million. It comprises AUD 300 million of 10-year fixed rate Notes and AUD 150 million of 5-year floating rate Notes.
The five-year floating rate Notes are valued at a margin of 0.97 per cent over 3M BBSW and the 10-year fixed rate Notes cost at a coupon of 2.1 per cent. Subject to customary conditions, settlement of the Notes was due for 27 August 2020.
On 11 September, COL traded flat at AUD 17.140, with a market capitalisation of AUD 22.86 billion. Its stock has delivered a return of more than 10 per cent in the last six-month period.
Webjet Limited to Roll Out New Long-Term Incentive Plan
Webjet Limited (ASX:WEB) has acknowledged the challenges faced by employees whose fixed remuneration has been cut and short-term incentives of FY20 have been cancelled. Moreover, long-term incentive equity grants have also been cancelled.
Recognising the issues, on 2 September 2020, the company proposed to launch a new Long-Term Incentive Plan (LTIP) for its senior executives and key personnel.
The company would make an LTI grant to Managing Director, John Guscic. It would comprise of options to acquire fully paid ordinary shares in WEB that vest in 3 equal tranches over the next three years. It is subject to his ongoing employment and the company achieving some share price targets. The terms and conditions will be subject to shareholder approval.
Additionally, LTI grants for executive and key staff have been announced.
On 11 September, WEB traded downward by 2.813 per cent to AUD 3.800, with a market capitalisation of AUD 1.33 billion.
Related: Why Should You Look at ASX 200 Shares Flight Centre, Webjet, and Qantas?
Dicker Data Added to S&P/ASX 300 Index, FY20 Gross Profit Up 24.8 Per Cent
Dicker Data Limited (ASX:DDR) is set to be part of S&P/ASX 300 Index on 21 September 2020, in line with September 2020 Quarterly Rebalance of the S&P/ASX Indices by S&P Dow Jones Indices.
On 28 August 2020, the company released its interim financial report for the period ended 30 June 2020. Total revenue stood at AUD 1,006.1 million, up by 18.1 per cent. It comprises recurring software revenue of AUD 224 million, up by 53.1 per cent.
Group's gross profit stood at AUD 96.5 million, up by 24.8 per cent. Gross profit margins improved to 9.6 per cent, primarily owing to enhanced focus on mid-market and SMB business.
Net profit before tax was AUD 42.0 million, up 30.2 per cent, and net profit after tax stood at AUD 29.4 million, up 23.6 per cent. Earnings per share grew to 17.08 cents, up by 16.0 per cent.
Balance Sheet
- Total investment in working capital stood at AUD 162.1 million, down by AUD 3.3 million.
- Fixed asset investment boosted by AUD 27.4 million
- Borrowings reduced by AUD 39.9 million with repayment of the corporate bond in March 2020
- Equity grew to AUD 158.6 million, an improvement of AUD 63.6 million.
- Net cash generated from operating activities stood at AUD 30.3 million, an increase of AUD 14.6 million.
On 11 September, Dicker Data traded at AUD 7.410, down by 3.641 per cent with a market capitalisation of AUD 1.32 billion.
