BUSINESS FORECASTING – AUSTRALIA

Officeworks tipped for more growth

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Original article by Sue Mitchell
The Australian Financial Review – Page: 20 : 18-Sep-18

Wesfarmers’ Officeworks division posted earnings growth of 8.3 per cent in fiscal 2018, with sales rising by 9.1 per cent and return on capital up 13 per cent. MD Mark Ward is upbeat about the outlook for Officeworks, expressing confidence that it can maintain the recent growth momentum. Although Ward will retire in late 2018, Wesfarmers has yet to appoint a successor as it is focused on the upcoming demerger of Coles.

CORPORATES
OFFICEWORKS SUPERSTORES PTY LTD, WESFARMERS LIMITED – ASX WES, COLES SUPERMARKETS AUSTRALIA PTY LTD, AMAZON.COM INCORPORATED, GOOGLE INCORPORATED, ONTHEGO PTY LTD

Worrying sign investment has peaked

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Original article by Patrick Commins
The Australian Financial Review – Page: 8 : 31-Aug-18

The Australian Bureau of Statistics has reported that business investment fell by 2.5 per cent in the June quarter; economists had been tipping an increase of 0.6 per cent. Mining sector spending was down 7.2 per cent over the quarter, while non-mining investment declined by 0.5 per cent. However, companies increased their business investment forecast for 2018-19 to just under $102 billion, an increase of 16.1 per cent on the last forecast three months ago.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, AUSTRALIAN LABOR PARTY, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, CAPITAL ECONOMICS LIMITED, TD SECURITIES, AMP LIMITED – ASX AMP, LIBERAL PARTY OF AUSTRALIA, BIS OXFORD ECONOMICS PTY LTD

CBA may need a rethink on dividend

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Original article by Sarah Turner
The Australian Financial Review – Page: 31 : 30-Aug-18

Analysts suggest that the Commonwealth Bank may have to reduce its dividend payout if it proceeds with the demerger of CFS Group. Shareholders received a total dividend of $4.31 per share for the 2017-18 financial year, but Richard Wiles of Morgan Stanley estimates that this could fall to around $4 per share if its wealth management and mortgage broking assets are demerged. However, Andrew Martin of Alphinity Investment Management does not expect the bank to reduce its dividend in the near-term.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, CFS GROUP, MORGAN STANLEY AUSTRALIA LIMITED, ALPHINITY INVESTMENT MANAGEMENT PTY LTD, JP MORGAN AUSTRALIA LIMITED, CLIME ASSET MANAGEMENT PTY LTD, PLATYPUS ASSET MANAGEMENT PTY LTD, WESTPAC BANKING CORPORATION – ASX WBC

Miners warn of graduate crisis

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Original article by Matt Chambers
The Australian – Page: 19 & 22 : 29-Aug-18

The Minerals Council of Australia has forecast that the number of mining engineering graduates will fall from 171 a year to just 47 between 2017 and 2020 due to a decline in enrolments. However, the MCA’s modelling suggests that at least 200 new graduates will be required each year to offset the number of mining engineers who exit the sector. South32 CEO Graham Kerr and Newcrest Mining CEO Sandeep Biswas are among the industry executives who have expressed concern about the long-term impact of the decline in enrolments for mining-related university courses.

CORPORATES
MINERALS COUNCIL OF AUSTRALIA, SOUTH32 LIMITED – ASX S32, NEWCREST MINING LIMITED – ASX NCM, DIGGERS AND DEALERS FORUM

NAB operations boss quits as Baird firms for top job

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Original article by James Eyers
The Australian Financial Review – Page: 15 & 18 : 28-Aug-18

Former New South Wales premier Mike Baird is now regarded as the leading internal candidate to eventually succeed National Australia Bank CEO Andrew Thorburn. COO Antony Cahill had been seen as a potential successor, but he will leave the bank in mid-September to take up a role at Visa in the UK. Andrew Hagger was also regarded as a contender to replace Thorburn, but he attracted scrutiny by the banking royal commission over the fee-for-no-service scandal. External candidates are said to include former Westpac executive Jason Yetton.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, VISA INTERNATIONAL, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, WESTPAC BANKING CORPORATION – ASX WBC, SOCIETYONE AUSTRALIA PTY LTD, MLC LIMITED, PERPETUAL LIMITED – ASX PPT

Buyer eyes Fairfax Media events arm

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Original article by Joyce Moullakis, Max Mason
The Australian Financial Review – Page: 19 : 28-Aug-18

US-based Motiv has declined to comment on reports that it has made an informal approach to acquire Fairfax Media’s events business, which Macquarie Equities values at about $60m. Fairfax’s proposed merger partner, Nine Entertainment Company, divested its own events business in 2015. A Nine spokeswoman says it is too soon to comment on potential asset sales. There has been speculation that Nine could divest other Fairfax assets, including its regional newspapers.

CORPORATES
FAIRFAX MEDIA LIMITED – ASX FXJ, MOTIV, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, AUSTRALIAN COMMUNITY MEDIA, STUFF LIMITED, MACQUARIE EQUITIES LIMITED, AUSTRALIAN METRO MEDIA, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, AFFINITY EQUITY, TEG PTY LTD

High prices to drive spring rural listings

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Original article by Matthew Cranston
The Australian Financial Review – Page: 32 : 27-Aug-18

The drought does not seem to have had too much impact on the value of farm properties in New South Wales, with values in some areas rising by 30 per cent over the past 12 months. Andrew Street of Landmark Harcourts says there is a lot of interest in cotton properties at the moment. Sam Hempinstall of Michael Keating International expects demand for Victorian rural estate to exceed supply during the 2018 spring, with good interest coming from both Asia and Europe.

CORPORATES
LANDMARK HARCOURTS PTY LTD, MICHAEL KEATING INTERNATIONAL PTY LTD, ELDERS LIMITED – ASX ELD, LABOUR PARTY (NEW ZEALAND)

Warning over gas glut: Oil Search

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Original article by Andrew White
The Australian – Page: 23 : 22-Aug-18

Oil Search has posted a 2018 interim net profit of $US79.2m ($107.7m), which is 39 per cent lower than previously. Production fell by 31 per cent to 10.24 million barrels of oil equivalent after its Papua New Guinea operations were disrupted by an earthquake in February. Oil Search expects full-year output of 24 million to 26 million boe. Meanwhile, CEO Peter Botten has questioned whether all four of the proposed LNG import terminals in the eastern states would be economically viable.

CORPORATES
OIL SEARCH LIMITED – ASX OSH, AGL ENERGY LIMITED – ASX AGL, FORTESCUE METALS GROUP LIMITED – ASX FMG, EXXONMOBIL CORPORATION

Seven West open to closer News Corp ties

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Original article by Max Mason
The Australian Financial Review – Page: 19 : 22-Aug-18

Seven West Media has posted a 2017-18 net profit of $135.8m, following a $744.3m loss in the previous financial year. Revenue was 3.2 per cent lower at $1.6bn and underlying EBIT fell 9.9 per cent to $235.6m, while Seven forecasts growth in underlying EBIT of 5-10 per cent in 2018-19. CEO Tim Worner says Seven may seek to strengthen its commercial partnerships or forge new deals in the wake of Nine Entertainment’s proposed merger with Fairfax Media. He notes that Seven already has an alliance with News Corp, but he has downplayed suggestions of a merger.

CORPORATES
SEVEN WEST MEDIA LIMITED – ASX SWM, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, FAIRFAX MEDIA LIMITED – ASX FXJ, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, YAHOO!7 COMMUNICATIONS AUSTRALIA PTY LTD, MARTIN CURRIE INVESTMENT MANAGEMENT LIMITED, PRIME MEDIA GROUP LIMITED – ASX PRT

Music to the ears of investors as the beats go on

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Original article by David Rogers
The Australian – Page: 27 : 21-Aug-18

The August corporate reporting season in Australia has generally been positive, with about half the companies that have reported to date announcing earnings and dividend payouts that met expectations. This has been reflected in share prices, with stocks that have beaten expectations rising by 2.8 per cent on average and those that failed to do so tending to fall by around three per cent. However, Jason Steed of JP Morgan notes that earnings per share forecasts have been downgraded for 29 per cent of stocks, while just nine per cent have been upgraded.

CORPORATES
JP MORGAN AUSTRALIA LIMITED, DEUTSCHE BANK AG, MORGAN STANLEY AUSTRALIA LIMITED, BRAMBLES LIMITED – ASX BXB, COLLECTION HOUSE LIMITED – ASX CLH, ARB CORPORATION LIMITED – ASX ARB, COCA-COLA AMATIL LIMITED – ASX CCL, STANDARD AND POOR’S ASX 200 INDEX, RIO TINTO LIMITED – ASX RIO, AGL ENERGY LIMITED – ASX AGL, CHALLENGER LIMITED – ASX CGF, MINERAL RESOURCES LIHIR PTY LTD, PACT GROUP HOLDINGS LIMITED – ASX PGH, COCHLEAR LIMITED – ASX COH, DOMINO’S PIZZA ENTERPRISES LIMITED – ASX DMP, SEEK LIMITED – ASX SEK, ANSELL LIMITED – ASX ANN