BUSINESS FORECASTING – AUSTRALIA

Qantas shares bumper profit with investors

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Original article by Jamie Freed
The Australian Financial Review – Page: 13 & 18 : 16-Dec-15

Qantas expects a 2015-16 interim underlying pre-tax profit of $A875m to $A925m, compared with $A367m for the previous corresponding period. The airline has benefited from factors such as lower fuel prices, higher revenue and cost reductions in the current half-year. CEO Allan Joyce has signalled that Qantas will look at returning surplus cash to shareholders in the next several years, while Matthew Spence of Merrill Lynch expects the carrier to launch a share buyback with the release of its half-year accounts.

CORPORATES
QANTAS AIRWAYS LIMITED – ASX QAN, MERRILL LYNCH (AUSTRALIA) PTY LTD, JETSTAR AIRLINES PTY LTD, VIRGIN AUSTRALIA HOLDINGS LIMITED – ASX VAH, WOOLWORTHS LIMITED – ASX WOW, BP AUSTRALIA LIMITED

Price fall no bar to Rio plans

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Original article by Matt Chambers
The Australian – Page: 18 : 15-Dec-15

Rio Tinto will press ahead with plans to increase its low-cost iron ore production capacity by 20 million tonnes over the next few years, despite the downturn in the iron ore price. A spokesman argues that any move by Australian iron ore producers to reduce output will allow overseas rivals to gain market share at the expense of local miners. Fortescue Metals Group founder Andrew Forrest has again called for Rio Tinto and BHP Billiton to reduce their iron ore production.

CORPORATES
RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP BILLITON LIMITED – ASX BHP, VALE SA, UBS HOLDINGS PTY LTD, ROY HILL IRON ORE PTY LTD

Hopes high for a better year in media

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Original article by Darren Davidson
The Australian – Page: 16 : 14-Dec-15

Data from ZenithOptimedia shows that advertising expenditure across all media is expected to reach a record $A13.4bn in Australia during calendar 2016. Meanwhile, a survey of the CEOs of 23 media companies has identified key issues for the industry in 2016. They include cross-media ownership reform, government measures to stimulate economic growth following the end of the resources boom, and the need for Australia to become more innovative.

CORPORATES
ZENITH OPTIMEDIA, SEVEN WEST MEDIA LIMITED – ASX SWM, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, NOVA ENTERTAINMENT PTY LTD, FOXTEL MANAGEMENT PTY LTD, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, SEEK LIMITED – ASX SEK, TEN NETWORK HOLDINGS LIMITED – ASX TEN, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, TELSTRA CORPORATION LIMITED – ASX TLS, FACEBOOK INCORPORATED, REA GROUP LIMITED – ASX REA, IPROPERTY GROUP LIMITED – ASX IPP

No slow down in 2016 for hot M&A volumes

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 17 : 9-Dec-15

Data from Dealogic shows that mergers and acquisitions activity involving Australian companies has risen by 80 per cent so far in 2015, to $US124.9bn ($A170.9m). This includes 23 deals worth $US1bn ($A1.4bn). Alex Cartel of Deutsche Bank forecasts further growth in M&A activity in 2016, while Gareth Cope of Rothschild Australia says the country remains highly attractive to offshore investors. Meanwhile, equity capital market issuance has reached its highest level since 2009, at more than $US42bn.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, DEUTSCHE BANK AG, NM ROTHSCHILD AUSTRALIA HOLDINGS PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG, UBS HOLDINGS PTY LTD, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD, WOODSIDE PETROLEUM LIMITED – ASX WPL, OIL SEARCH LIMITED – ASX OSH, SANTOS LIMITED – ASX STO, SCEPTER PARTNERS, BROADSPECTRUM LIMITED – ASX BRS, TRANSGRID, VEDA GROUP LIMITED – ASX VED, EQUIFAX INCORPORATED, ASCIANO LIMITED – ASX AIO, CALTEX AUSTRALIA LIMITED – ASX CTX, CHEVRON CORPORATION, HEALTHSCOPE LIMITED – ASX HSO, TPG CAPITAL LP, THE CARLYLE GROUP

Listed companies too afraid to provide guidance, study says

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 1 & 11 : 8-Dec-15

McGrathNicol has released a report which shows that just 49 per cent of the 104 Australian-listed companies it surveyed have released earnings guidance in 2015, compared with 57 per cent in 2014. The survey also found that the number of companies that met or exceeded their earnings guidance fell from 69 per cent in 2014 to 64 per cent. Factors such as concern about class actions and challenging market conditions in some sectors have contributed to companies’ reluctance to release earnings guidance.

CORPORATES
McGRATH NICOL AND PARTNERS SERVICES PTY LTD, ASX LIMITED – ASX ASX, BROADSPECTRUM LIMITED – ASX BRS, JB HI-FI LIMITED – ASX JBH, PACIFIC BRANDS LIMITED – ASX PBG

Insurance jobs under threat from technology

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Original article by Ruth Liew
The Australian Financial Review – Page: 25 : 8-Dec-15

Suncorp Group executive Darren O’Connell notes that the growing use of automation in the insurance sector has resulted in the elimination of entry-level jobs in the underwriting industry. He says this will result in a dearth of underwriters with expertise across the industry as older staff retire and their skills and knowledge are lost. O’Connell argues in a research paper that technology can never completely replace people in the underwriting industry, and insurers should reconsider their recruitment procedures.

CORPORATES
SUNCORP GROUP LIMITED – ASX SUN, SWISS RE AUSTRALIA LIMITED, IBM CORPORATION

Atlassian on the verge of record-breaking float in the US

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Original article by John Kehoe
The Australian Financial Review – Page: 20 : 7-Dec-15

Australian software developer Atlassian is reportedly due to list on the Nasdaq stock exchange on 10 December 2015, although this has yet to be confirmed. The group’s IPO is expected to be worth about $US350m, with its shares likely to be issued at between $US16.50 and $US18.50 apiece. Data from Renaissance Capital shows that the number of technology IPOs in the US has fallen from 55 in 2014 to just 22 so far in 2015.

CORPORATES
ATLASSIAN SOFTWARE SYSTEMS PTY LTD, NASDAQ, RENAISSANCE CAPITAL CORPORATION, MYOB GROUP LIMITED – ASX MYO, GARTNER GROUP INCORPORATED, THE GOLDMAN SACHS GROUP INCORPORATED, MORGAN STANLEY AND COMPANY INCORPORATED, UNIVERSITY OF NEW SOUTH WALES

Ad market set for election bounce in 2016, say sales bosses

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Original article by Dominic White
The Australian Financial Review – Page: 30 : 7-Dec-15

Australia’s commercial TV networks are upbeat about the outlook for the advertising market in 2016. Seven West Media’s chief revenue officer Kurt Burnette notes that there was 11 per cent growth in the ad market in 2004, which is the last time the Olympics and a federal election were held in the same year. Optimism about the ad market in 2016 will also be bolstered by the national census in August.

CORPORATES
SEVEN WEST MEDIA LIMITED – ASX SWM, TEN NETWORK HOLDINGS LIMITED – ASX TEN, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, FOXTEL MANAGEMENT PTY LTD, SEVEN NETWORK LIMITED, PACIFIC MAGAZINES PTY LTD, NETFLIX INCORPORATED, YAHOO!7 COMMUNICATIONS AUSTRALIA PTY LTD, AUSTRALIAN BUREAU OF STATISTICS, MULTI CHANNEL NETWORK PTY LTD, NINE NETWORK AUSTRALIA LIMITED, OZTAM PTY LTD

Worst yet to come for BHP, says S&P

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Original article by Peter Ker, Perry Williams
The Australian Financial Review – Page: 29 : 25-Nov-15

Standard & Poor’s has left BHP Billiton’s credit rating of "A+" with a negative outlook unchanged. Analyst May Zhong says the tailings dam disaster at the Samarco iron ore joint venture will not have any near-term effect on BHP’s credit rating. However, Zhong adds that factors such as BHP’s progressive dividend policy and the downturn in commodity prices are likely to adversely affect the group’s financial risk profile in 2016.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, STANDARD AND POOR’S CORPORATION, SAMARCO MINERACAO SA, VALE SA, MOODY’S INVESTORS SERVICE INCORPORATED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

AGM downgrades but growth likely

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Original article by Vanessa Desloires
The Australian Financial Review – Page: 27 : 24-Nov-15

Analysis by Citigroup shows that 36 Australian-listed companies have upgraded their earnings guidance during the 2015 AGM season, and 42 have issued downgrades. Citigroup’s Tony Brennan notes that earnings-per-share forecasts have been reduced by about one per cent overall. Citigroup now expects the benchmark S&P/ASX 200 to be trading at 5,900 points at the end of 2016, compared with its previous forecast of 6,200.

CORPORATES
CITIGROUP PTY LTD, STANDARD AND POOR’S ASX 200 INDEX, MACQUARIE GROUP LIMITED – ASX MQG, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN