CORPORATE PROFITS – AUSTRALIA

Investors expect more solid profits

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Original article by Patrick Commins
The Australian Financial Review – Page: 13 & 20 : 20-Aug-18

The S&P/ASX 200 has gained one per cent so far in August. Investor sentiment has been boosted by an earnings reporting season that has exceeded expectations, with more than 80 per cent of companies having posted higher profits than at the same time in 2017. Shane Oliver of AMP Capital also notes that the share prices about 60 per cent of companies have risen on the day their financial results were announced. BHP Billiton, Qantas and Woolworths are among about 70 major companies that are slated to release their latest results in the next week.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, AMP CAPITAL INVESTORS LIMITED, BHP BILLITON LIMITED – ASX BHP, QANTAS AIRWAYS LIMITED – ASX QAN, WOOLWORTHS GROUP LIMITED – ASX WOW, SOUTH32 LIMITED – ASX S32, COCA-COLA AMATIL LIMITED – ASX CCL, ATLAS FUNDS MANAGEMENT PTY LTD, QBE INSURANCE GROUP LIMITED – ASX QBE, WESFARMERS LIMITED – ASX WES, COLES SUPERMARKETS AUSTRALIA PTY LTD, JB HI-FI LIMITED – ASX JBH, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, TRIBECA INVESTMENT PARTNERS PTY LTD, DOMAIN HILL PROPERTY GROUP PTY LTD, REA GROUP LIMITED – ASX REA, REALESTATE.COM.AU, CELESTE FUNDS MANAGEMENT LIMITED, MORGAN STANLEY AUSTRALIA LIMITED, AMCOR LIMITED – ASX AMC, BORAL LIMITED – ASX BLD, NEWCREST MINING LIMITED – ASX NCM, RIO TINTO LIMITED – ASX RIO

BHP royalties to soften cost spike for Iluka

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Original article by Brad Thompson
The Australian Financial Review – Page: 28 : 17-Aug-18

Iluka Resources has posted a 2018 interim net profit of $126m and EBITDA of $279m. The mineral sands producer has advised that the cost of expanding its rutile assets in Sierra Leone could be 40-60 per cent higher than forecast, with the Sembehun deposit accounting for the bulk of the expected cost overrun. Operating costs at the Sierra Rutile assets are also forecast to exceed previous guidance. Iluka also receives royalty payments from BHP Billiton’s Mining Area C iron ore operations.

CORPORATES
ILUKA RESOURCES LIMITED – ASX ILU, SIERRA RUTILE LIMITED, BHP BILLITON LIMITED – ASX BHP

Former Rio mines a boon for Yancoal

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Original article by Peter Ker
The Australian Financial Review – Page: 19 : 17-Aug-18

Yancoal Australia has reported a 2018 interim net profit of $361m. The result was boosted by the contribution of Rio Tinto’s thermal coal mines in New South Wales and a sharp rise in the price of thermal coal since the deal was struck. About $130m of the interim profit will be returned to shareholders via dividend payments, which equates to about $0.003 per share.

CORPORATES
YANCOAL AUSTRALIA LIMITED – ASX YAL, RIO TINTO LIMITED – ASX RIO, WHITEHAVEN COAL LIMITED – ASX WHC

Upbeat Wesfarmers flags growth, capital management

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Original article by Sue Mitchell
The Australian Financial Review – Page: 17 & 22 : 16-Aug-18

Perth-based conglomerate Wesfarmers has posted a 2017-18 net profit of $A1.19bn, which is 58.3 per cent lower than previously. The full-year result was marred by writedowns, including a $1.4bn hit due to its ill-fated expansion into the UK and Ireland. Wesfarmers’ underlying net profit from continuing operations exceeded market expectations at $2.9bn. MD Rob Scott has indicated that surplus capital following asset sales and the Coles demerger will be returned to shareholders.

CORPORATES
WESFARMERS LIMITED – ASX WES, COLES GROUP LIMITED, KMART AUSTRALIA LIMITED, TARGET AUSTRALIA PTY LTD, BUNNINGS GROUP LIMITED, KMART TYRE AND AUTO, OFFICEWORKS SUPERSTORES PTY LTD

Restart at Koolan has Mt Gibson in sweet spot

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Original article by Peter Ker
The Australian Financial Review – Page: 20 : 16-Aug-18

Mount Gibson Iron has reported a 2017-18 net profit of $99.1m, with insurance proceeds arising from a seawall collapse at the Koolan Island mine contributing $64m to the result. The mine is expected to resume shipments within six months, more than four years after the incident put production on hold. Mount Gibson will benefit from a strong rise in the premium for higher-grade iron ore in the intervening years; ore with 65.5 per cent iron content such as that produced at Koolan Island is now fetching a premium of around 30 per cent to the benchmark price, compared with 3-5 per cent at the time of the collapse.

CORPORATES
MOUNT GIBSON IRON LIMITED – ASX MGX, VALE SA, KUMBA RESOURCES LIMITED, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, UBS HOLDINGS PTY LTD

Risks are real even in blur of reporting season

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Original article by David Rogers
The Australian – Page: 28 : 15-Aug-18

The earnings outlook for Australian companies has been encouraging so far in the August reporting season. There has been an 0.5 per cent increase in the consensus estimate for growth in earnings per share over the next year, based on financial results to date. Local investors have largely shrugged off global issues such as the downturn in the Turkish lira and continued trade tensions between the US and China. However, local shares – and other asset classes – remain vulnerable to external risks.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, DOMINO’S PIZZA ENTERPRISES LIMITED – ASX DMP, COCHLEAR LIMITED – ASX COH, CHALLENGER LIMITED – ASX CGF, CSL LIMITED – ASX CSL, WOODSIDE PETROLEUM LIMITED – ASX WPL, WESFARMERS LIMITED – ASX WES, QBE INSURANCE GROUP LIMITED – ASX QBE, DEXUS – ASX DXS, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, SEEK LIMITED – ASX SEK, PERPETUAL LIMITED – ASX PPT, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, EUROPEAN CENTRAL BANK

JB Hi-Fi growth slows as competition intensifies

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Original article by Sue Mitchell
The Australian Financial Review – Page: 11 & 16 : 14-Aug-18

Consumer electronics retailer JB Hi-Fi has posted a 2017-18 underlying net profit of $233.2m, which is 12.3 per cent higher than previously. Group earnings rose 14.5 per cent to $350.6m, while its Australian division’s earnings were 11.4 per cent higher at $292.3m. Sales grew by 21.8 per cent in 2017-18, but expectations of competition from key rivals and fewer store openings have prompted the company to pare back its sales growth forecast to just 3.6 per cent in 2018-19. Shareholders will receive a full-year dividend of $0.132 per share.

CORPORATES
JB HI-FI LIMITED – ASX JBH, THE GOOD GUYS, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN, AMAZON.COM INCORPORATED, MARTIN CURRIE INVESTMENT MANAGEMENT LIMITED, JP MORGAN AUSTRALIA LIMITED

Vesey to stay put as AGL profit surges

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Original article by Andrew White
The Australian – Page: 17 & 21 : 10-Aug-18

AGL Energy has posted a 2017-18 net profit of $1.59bn, compared with $539m previously. The electricity generator and retailer’s underlying profit rose by 28 per cent to $1.02bn. AGL has reported revenue of $12.8bn, a modest increase from the previous fiscal year, while shareholders will receive a partially franked final dividend of $0.63 per share. CEO Andy Vesey has refuted suggestions that he may step down, stressing that he will remain at the helm while AGL implements its three-year strategy.

CORPORATES
AGL ENERGY LIMITED – ASX AGL, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE ENVIRONMENT AND ENERGY, SANTOS LIMITED – ASX STO, ALINTA ENERGY (AUSTRALIA) PTY LTD, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, MACQUARIE GROUP LIMITED – ASX MQG

Time for companies to splash the buyback cash

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Original article by David Rogers
The Australian – Page: 27 : 10-Aug-18

Berowne Hlavaty of JP Morgan says key indicators suggest that the August reporting season in Australia will be a strong one. The firm’s poll of analysts shows that 33 per cent of stocks are expected to post an earnings surprise on the upside, while only 17 per cent of stocks will surprise on the downside. JP Morgan has identified a number of companies that could potentially announce share buybacks during the reporting season. They include BHP Billiton, Westpac, Woolworths, Insurance Australia Group and Vicinity Centres.

CORPORATES
JP MORGAN AUSTRALIA LIMITED, BHP BILLITON LIMITED – ASX BHP, WESTPAC BANKING CORPORATION – ASX WBC, WOOLWORTHS GROUP LIMITED – ASX WOW, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, VICINITY CENTRES – ASX VCX, BLUESCOPE STEEL LIMITED – ASX BSL, ANSELL LIMITED – ASX ANN, MIRVAC GROUP – ASX MGR, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN, SUNCORP GROUP LIMITED – ASX SUN, PLATINUM ASSET MANAGEMENT LIMITED – ASX PTM, WESFARMERS LIMITED – ASX WES, PERPETUAL LIMITED – ASX PPT, SIMS METAL MANAGEMENT LIMITED – ASX SGM, SEVEN WEST MEDIA LIMITED – ASX SWM, NATIONAL STORAGE REIT – ASX NSR, CHARTER HALL LONG WALE REIT – ASX CLW, LYNAS CORPORATION LIMITED – ASX LYC, IRESS LIMITED – ASX IRE, GROWTHPOINT PROPERTIES AUSTRALIA – ASX GOZ, CHARTER HALL RETAIL REIT – ASX CQR, PERSEUS MINING LIMITED – ASX PRU, CROMWELL PROPERTY GROUP – ASX CMW, PROPERTYLINK GROUP LIMITED – ASX PLG, TASSAL GROUP LIMITED – ASX TGR, CARDNO LIMITED – ASX CDD, MYOB GROUP LIMITED – ASX MYO, MAGELLAN FINANCIAL GROUP LIMITED – ASX MFG, CROWN RESORTS LIMITED – ASX CWN, STANDARD AND POOR’S ASX 200 INDEX, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Comyn passes first test

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Original article by James Eyers, Jonathan Shapiro
The Australian Financial Review – Page: 1 & 18 : 9-Aug-18

The Commonwealth Bank has posted a 2017-18 cash profit of $9.23bn, which is 4.8 per cent lower than previously. The result was marred by a 9.2 per cent increase in operating expenses in the wake of the bank’s money-laundering scandal and the banking royal commission. CEO Matt Comyn says there will be "substantial progress" on addressing governance issues during 2018-19. Shareholders will receive a 2017-18 full-year dividend of $4.31 per share, which is $0.02 higher than previously.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, CLIME ASSET MANAGEMENT PTY LTD, UBS HOLDINGS PTY LTD, PERENNIAL VALUE MANAGEMENT LIMITED, ALPHINITY INVESTMENT MANAGEMENT PTY LTD, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MACQUARIE GROUP LIMITED – ASX MQG, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY