- Amid the ongoing COVID-19 pandemic, there are several companies that continue to perform well.
- Newcrest Mining registered strong Q4 performance, with gold production up 7% quarter-on-quarter and record annualised mined ore and mill throughput at Cadia.
- Nearmap implemented various cash management initiatives to remain financially secure during the crisis.
- Nanosonics reported continued underlying growth momentum for the business in Q3.
- After Nick Scali reopened all its showrooms in April, the sales rebounded. NCK also decided to complete the payment of its deferred interim dividend.
Over the past few months, stock markets have been on a roller coaster ride, primarily owing to so much uncertainty around the prolonged virus crisis.
In Australia, re-imposed restrictions due to resurgence of cases are taking a toll on the economic recovery plans. Until some medical breakthrough comes and economic activities function as before, the uncertainty is most likely to remain here.
On 27 July 2020 (AEST 01:04 PM), the benchmark index S&P/ASX 200 was trading upward by 0.08 per cent to 6,028.7.
That said, let's talk about a few popular stocks listed on ASX.
Newcrest Mining Limited (ASX:NCM)
Newcrest is one of the world's most prominent gold mining firms. The exploration report for three months ended 30 June 2020 suggested that Havieron mineralised zone has been extended and drilling identified new breccia zone at Havieron.
NCM has a 40 per cent interest in the Havieron project and is now advancing Stage 3 work programs. The company can earn up to a 70 per cent joint venture interest via US$65 million expenditure and completion of a series of exploration and development milestones in a four-stage farm-in over six years that commenced in May 2019.
Red Chris is a JV between NCM (70 per cent) and Imperial Metals Corporation (30 per cent). Two drilling campaigns are underway at the project.
- East Zone Resource Definition programme to obtain geological, geotechnical and metallurgical data
- Brownfields Exploration program to identify additional zones of higher-grade mineralisation
Drilling at Red Chris has confirmed the presence of a second high-grade pod with RC625 returning a partial intercept of 400m @ 0.65g/t Au and 0.51% Cu that includes 60m @ 2.2g/t Au and 1.3% Cu, located 100m SW of RC616.
In its quarterly report, the company highlighted to have registered strong performance in Q4, enabling Newcrest Mining to meet its group gold production guidance for FY20.
Quarterly highlights are as follows:
- Gold production grew by 7% quarter-on-quarter to reach 573koz
- Copper production increased by 15% quarter-on-quarter to reach 40kt
- At Cadia, record annualised mined ore and mill throughput achieved
- AUD 1.2 billion equity raising strengthened the balance sheet
On 27 July 2020 (AEST 01:06 PM), NCM was trading at AUD 35.720, up by 3.237 per cent, with a market cap of AUD 28.24 billion. The last three-month return of the stock was noted at 21.28 per cent.
Nearmap Ltd (ASX:NEA)
Perth-based next-gen digital content provider, Nearmap Ltd is engaged in providing high-resolution aerial imagery, integrated geospatial tools, and city-scale 3D datasets to businesses.
On 21 July 2020, NEA announced plans to release its financial results for the year ended 30 June 2020 on 19 August 2020.
During late-May 2020, NEA reported resilient business with robust growth trajectory. The company’s annualised contract value (ACV) continued to increase and exceeded AUD 102 million and guidance was narrowed to AUD 103 million to AUD 107 million, on a constant currency basis.
Nearmap implemented various cash management initiatives to save cash and strengthen the balance sheet for better flexibility. These equate to ~30 per cent saving in operating and capital costs. Permanent headcount was reduced by 10 per cent, while 25 per cent deduction was implemented to the Board and Chief Executive Officer's compensation for 6 months and 20 per cent salary reduction for other employees during the same period.
Closing FY20 Group cash balance was expected to be between AUD 32 million and AUD 35 million.
On 27 July 2020 (AEST 01:07 PM), NEA was trading at AUD 2.365, up by 1.068 per cent, with a market cap of AUD 1.06 billion. The last three-month return of the stock was noted at 97.47 per cent.
Nanosonics Limited (ASX:NAN)
Nanosonics is a medical technology company redefining the way infection prevention practices are carried out and understood through innovative technologies to enhance the care standard. Its Trophon product reduces the cross-contamination among patients and the spread of Healthcare Acquired Infections (HAIs).
Under its Q3 FY20 business update released in April 2020, Nanosonics reported continued underlying growth momentum for the business. Consumables sales in the quarter were as per the anticipation of the company before the pandemic.
Investment continued in R&D across a range of active programs. The company reported to have a strong balance sheet with cash reserves of AUD 82.0 million as at 31 December 2019 with negligible debt. Measures were in place to reduce non-essential operating costs in Q4 without impacting the company’s underlying strategy.
The staff continued to provide on-site support for the installation of new trophon devices.
On 27 July 2020 (AEST 01:08 PM), NAN was trading at AUD 6.370, up by 0.157 per cent, with a market cap of AUD 1.91 billion.
Nick Scali Limited (ASX:NCK)
NCK is a lifestyle retailer that offers a range of premium-quality furniture. The company implemented all essential measures across showrooms to prevent COVID 19.
During April, all showrooms were reopened, and they all traded strong after that, resulting in positive sales growth. The company also launched its digital offering to allow customers to buy the entire range of its products from the online channel. The online platform was in its early stages of development, but the growth has been promising.
NCK witnessed a substantial rebound in customer activity in May and first half of June. Going by the robust trading, the company was expecting sales order in May and June to increase by 54 per cent on PCP.
On 23 March 2020, Nick Scali decided to defer the payment of the 25c interim dividend until 2 October; however due to secure trading and sales growth, later the company chose to complete the payment of the previously deferred interim dividend to 29 June 2020.
On 27 July 2020 (AEST 01:09 PM), NCK was trading at AUD 6.970, up by 1.901 per cent, with a market cap of AUD 554.04 million. The last three-month return of the stock was noted at 86.89 per cent.