Category: Stock Market

The Domain Holdings Australia Ltd (ASX: DHG) share price is in the red after the company released its financial year 2022 earnings.

The property marketing provider’s stock opened 5% lower at $3.85 before tumbling to $3.70. That marks an 8.64% fall on its previous close. At the time of writing, the Domain share price has recovered some ground to trade at $3.87, down 4.44%.

Domain share price tumbles on full-year earnings

Here are the key takeaways from the company’s full-year earnings:

• $356.7 million of revenue – up 23.2% on that of the prior corresponding period (pcp)
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) reached $122.1 million – a 21.4% jump
• Net after-tax profit of $35.1 million ­– a 2% improvement
• Earnings per share (EPS) came to 9.3 cents, up 43.4%
• Expenses came to $234.6 million, up 24%
• Declared a 4-cent fully franked final dividend

The company’s latest full-year results were impacted by the timing of JobKeeper payments, as well as costs and benefits of its voluntary employee program Zipline.

It received a $6.5 million EBITDA benefit from JobKeeper and Zipline in financial year 2021. That reversed to an $8 million expense in financial year 2022.

Adjusted for such impacts, Domain’s EBITDA increased to $130.1 million, a 38.2% improvement. Its EBITDA margin also lifted to 36.5%. Meanwhile, its expenses, including its acquisition of Realbase, came in at $226.7 million, 15.9% greater than those of the prior corresponding period.

Additionally, after discounting significant items, the company’s net profits came in at $55.3 million, representing a 46% improvement.

It ended financial year 2022 with $151.5 million of net debt, representing a leverage ratio of 1.2 times ongoing EBITDA.

What else happened in FY22?

Domain made two notable acquisitions in financial year 2022.

First, it announced its plan to snap up property data business Insight Data Solutions for $60 million in September.

Next, it underwent a capital raise to acquire campaign management technology platform Realbase in a deal worth as much as $230 million in April. Its share price ultimately slumped 2% on the back of the news.

What did management say?

Domain CEO and managing director Jason Pellegrino commented on the company’s earnings, saying:

Over the past four years our team has remained laser focused on the elements of our business that we can control, against a backdrop of considerable trading volatility. This mindset has positioned Domain to leverage property market strength, while providing downside protection when the cycle has been less supportive. The creativity and hard work of our team are building Domain into a fundamentally stronger business, and this is reflected in the outstanding set of results we are delivering today.

What’s next?

The company didn’t provide vast earnings guidance for financial year 2022 today. Though, it did provide a quick update and made note of several expected happenings.

Firstly, it said the first six weeks of financial year 2023 saw ongoing growth in new ‘for sale’ listings and a return to normal trading patterns.

The company expects its financial year 2023 costs, excluding acquisition impacts, to increase in the low double-digit range. It also believes this fiscal year will see the full-year expense impact of the Insight Data Solutions and Realbase acquisitions. Together, they’re expected to add around $27 million to ongoing operating expenses and an associated incremental revenue contribution.

Finally, it anticipates its financial year 2023 EBITDA margins will remain stable on an adjusted basis, while expanding on a reported basis.

Domain share price snapshot

Today’s tumble included, the Domain share price is trading 34.9% lower than it was at the start of 2022.

It has also slipped 24% since this time last year.

In comparison, the S&P/ASX 200 Index (ASX: XJO) has fallen 6% year to date and 6% over the last 12 months.

The post Domain share price plummets 9% as expenses grow appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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One of the interesting aspects about Fortescue Metals Group Limited (ASX: FMG) shares is its green division called Fortescue Future Industries (FFI). It has big green hydrogen production goals and Fortescue also pays a big dividend.

Getting involved in a new industry is unsurprisingly going to take a lot of money and investment.

But, Fortescue is also known as one of the biggest dividend payers in Australia and on the ASX.

How is it going to keep the money flowing to its green initiatives and to shareholders? It’s a tricky conundrum. Is it possible to fund both?

What is the current split of Fortescue’s money?

Fortescue has set up a ratio of how much money it wants to allocate to FFI and how much it plans to pay as dividends to shareholders.

The ASX mining share’s policy is to have a dividend payout ratio of between 50% and 80% of full-year net profit after tax (NPAT).

In the FY22 half-year result it paid a fully-franked interim dividend of 86 cents per share. That represented a dividend payout ratio of 70% of the FY22 half-year net profit.

The capital allocation for Fortescue Future Industries is that 10% of Fortescue’s net profit after tax will go towards FFI.

So, even if Fortescue paid an 80% dividend payout ratio and 10% of profit towards FFI, it would still have 10% of its annual net profit to work with. However, the question is whether 10% of net profit will be enough to fund all of FFI’s ambitions. The volatility and long-term price action of iron ore could also be a factor.

The Australian reported on recent comments from Macquarie. The broker said there may be “increased scrutiny on capital allocation to FFI given earnings headwinds from soft iron ore prices”. Macquarie also said:

To date, FFI has underspent versus its 10% allocation from group earnings, with US$728m unutilised at the end of FY22. We note the FFI guidance is US$600-700m for FY23. However, we believe the weakness in iron ore prices could constrain FFI’s budget beyond the near term.

What is FFI doing with the money?

Fortescue Future Industries aims to take a global leadership position in green energy and green technology.

One of its first key projects as a global green energy manufacturing centre is in Queensland. The project is an electrolyser manufacturing facility in Gladstone, with an initial capacity of 2GW per annum.

It’s looking to convert the Gibson Island ammonia facility to green hydrogen power, in partnership with Incitec Pivot Ltd (ASX: IPL).

Fortescue Future Industries is also looking to repurpose coal infrastructure at AGL Energy Limited (ASX: AGL)’s Hunter Valley Liddell and Bayswater coal-fired power stations.

It’s also working on green energy projects in a number of countries including Papua New Guinea, Indonesia, New Zealand and Germany.

FFI is working on decarbonising Fortescue’s operations, as well as growing its acquired advanced battery business, Williams Advanced Engineering.

Fortescue share price snapshot

Over the last month, Fortescue shares have risen by 15%.

The post Can shareholders have bigger dividends AND more spending on Fortescue Future Industries? appeared first on The Motley Fool Australia.

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• Why is the Rio Tinto share price lagging the ASX 200 on Tuesday?
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Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Life360 Inc (ASX: 360) share price swung like a pendulum on Tuesday as investors digested the company’s first-half results.

After tumbling more than 8% in early morning trade, the Life360 share price made a stunning recovery to finish the day more than 5% higher.

Despite yesterday’s rise, the Life360 share price is still languishing around 40% lower this year. 

Could the dip present a buying opportunity for this up-and-coming ASX tech share?

Setting the scene

Life360 is a US-based company that made a name for itself by designing a family safety app for smartphones.

The company offers a freemium model where a basic subscription allows families (also known as ‘circles’) to see the whereabouts of other members in their group on a map in real-time. It’s similar to Apple Inc’s (NASDAQ: AAPL) Find My feature on its devices.

But Life360 differentiates itself through the comprehensiveness of features on offer. Families can access a range of features through the company’s paid subscriptions, including crash detection, driver reports, roadside assistance, and ID theft protection.

While this remains Life360’s core offering, the company has turned to acquisitions to build out its ecosystem.

In September 2021, it completed the acquisition of Jiobit, a provider of wearable location devices for young children, pets, and seniors.

Not long after, Life360 made headlines when it announced the US$170 million acquisition of Tile, a leading provider of location trackers that can be attached to valuable items.

With these acquisitions under its belt, Life360 has completed its ‘360’ vision of protecting people, pets, and things.

The company believes these deals have expanded its addressable market. And integrated together, it expects its new bundled offering to lead to higher conversion rates to paid subscriptions, increased average revenue per paying circle, and improved retention rates.

Profitability ahoy

As a consumer-focused software-as-a-service (SaaS) business, Life360 reports plenty of metrics for investors to monitor.

But beyond these metrics and financials, what likely caught the attention of the market yesterday was the company’s commentary around profitability.

The flavour of February’s reporting season earlier this year was costs and, in turn, profits. ASX growth shares, in particular, were swiftly and brutally sold down on signs of increasing operating expenses and/or no line of sight to profitability.

So perhaps learning from this, Life360 has made its focus on the bottom line clear. 

In welcome news for investors, the company expects to deliver positive cash flow in the fourth quarter of CY22. And according to management, its current trajectory should see Life360 becoming earnings before interest, tax, depreciation and amortisation (EBITDA) positive by late CY23.

This path to profitability is underpinned by a leaner cost base, organisational cost efficiencies, reducing commissions, new bundled memberships, and improving subscriber metrics.

What’s more, the company is currently market testing higher price points for its subscriptions. If Life360 does indeed have latent pricing power and decides to flex it, these price increases could add further upside.

Life360 share price snapshot

The Life360 share price went on a tear in 2021, rocketing more than 150% to be on the radar of many ASX growth investors.

2022 hasn’t been so kind, with Life360 shares tumbling roughly 40% in the year to date.

The company expects to deliver revenue between US$245 million and US$260 million in CY22. The midpoint of this range represents 124% growth compared to CY21, predominantly driven by the addition of Tile.

Taking the midpoint of CY22 revenue guidance, Life360 shares are trading on a forward price-to-sales ratio of roughly 3x.

With a rapidly-growing user base, strong optionality, improving economics, and a founder at the helm, Life360 is an ASX tech share firmly on my watchlist.

The post Down 40% this year, should you pounce on this ASX tech share now before it becomes profitable? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why BHP, Life360, Tassal, and Temple & Webster shares are charging higher
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• Here are the top 10 ASX 200 shares today

Motley Fool contributor Cathryn Goh has positions in Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple and Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

A bifurcation in performance is starting to be seen in the crypto sector. However, unlike the uneven performance we saw for most of this year, in which high-quality tokens outperformed their more speculative counterparts, the more recent rally that’s played out over the past few weeks has seen more speculative meme tokens outperform on a relative basis.

Today, this trend has continued. As of 10:30 a.m. ET, Dogecoin (CRYPTO: DOGE) surged 15.1% higher, despite relative weakness in many top-tier tokens. This move represents the addition of more than $1 billion in market capitalisation overnight, as this token’s overall valuation has surged to more than $11 billion.

The key catalyst driving Dogecoin’s outperformance appears to be bullish sentiment surrounding the upcoming Ethereum merge. Various Ethereum-based tokens, such as Dogecoin, have outperformed in this merge-based rally, in many cases to a greater degree than Ethereum itself. 

So what

The speculative interest that’s prevailing in the crypto sector isn’t isolated. In fact, in the equity market, there’s been some rather impressive moves among what seemed to be forgotten meme stocks. Short sellers are once again on their heels, as the retail investor has seemingly stormed back with a vengeance. 

For the crypto sector, one that’s inherently more speculative, meme tokens represent some of the highest-risk assets around. Accordingly, during speculative booms, this sector has seen outsized interest. Dogecoin’s returns during previous bull market rallies speak for themselves.

Now what

From here, the question many investors have is whether this speculative momentum can be sustained for days, weeks, or months. At some point, rallies fizzle out and are replaced with periods of profit taking, consolidation, or a downturn. This year, we’ve seen what can happen when sentiment around hard-to-value tokens takes a hard 180.

It’s important to remember that many macro headwinds remain on the horizon. And while the market is pricing in a soft landing, with a reversion toward a more accommodative monetary policy from the Fed, the continued tightening of financial conditions through the end of the year could provide significant resistance for retail traders. Thus, those looking to buy Dogecoin in this rally ought to take the necessary precautions, as the recovery could be as precarious as previous ones.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Dogecoin just added $1 billion of market cap on this catalyst appeared first on The Motley Fool Australia.

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More reading

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Chris MacDonald has positions in Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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ASX cannabis shares have been mixed performers on the market in the year to date, but are there better days ahead?

Cannabis shares on the ASX include Cronos Australia Ltd (ASX: CAU), Incannex Healthcare Ltd (ASX: IHL), Emyria Ltd (ASX: EMD), Cann Group Ltd (ASX: CAN) and Creso Pharma Ltd (ASX: CPH).

Let’s take a look at some of the cannabis shares on the market.

What’s going on?

Many ASX cannabis shares have struggled year to date. Incannex shares have slumped 49% this year so far, while Creso Pharma shares have lost 52%.

Meanwhile, Cann Group shares have fallen nearly 2% and Emyria shares have lost nearly 30%.

Incannex is a cannabinoid and psychedelic compound medicine development company. Despite falling in the year to date, the company’s shares have experienced a recent boost on the back of recent news. The company stated it has the “world’s largest portfolio of patented medicinal cannabinoid drug formulations and psychedelic treatment protocols”.

Commenting on the cannabis industry, Former Incannex chief medical officer Dr Sud Agarwal told The Australian the “industry went off with a bang” in 2016 and 2017. However, he said by 2021 and the second half of early 2022, there has been “a real compression of values”. Dr Agarwal, current CEO and founder of Cannvalate Medical Cannabis, added:

That is mainly because a lot of companies haven’t performed in terms of revenues but also people who had previously been investors in cannabis probably just got fatigued.

Meanwhile, Cronos develops and sells cannabinoid brands and products in Australia, Japan and Hong Kong. Cronos shares have soared 55% in the year to date.

SG Hiscock Medical Technology Fund manager Rory Hunter singled out Cronos as a company making money. Also commenting in The Australian, he said:

The fact is not all companies are underperforming. Cronos Australia is one ASX-listed company that has strong financial performance.

It’s downstream in the value chain, highly scalable and has a cash generative business model. It’s also the only ASX-listed company in the industry making money right now.

How have these ASX cannabis shares performed in the last month?

In the past month, ASX cannabis shares appear to be recovering. The Cronos share price has lifted nearly 57%, while Incannex shares have exploded 60% and Emyria shares have jumped nearly 23%.

However, Creso Pharma shares have descended 11% in the last month and Cann Group shares have fallen nearly 7%.

For perspective, the S&P/ASX 200 Health Care Index has climbed 0.7% in the past month.

The post Can ASX cannabis shares ever fully recover? appeared first on The Motley Fool Australia.

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More reading

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• ‘World’s largest portfolio’: Why this ASX cannabis share is up 36% in August
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• Why Creso Pharma, Endeavour, Orica, and Woodside shares are dropping
• The Incannex share price has plunged 70% so far in 2022. What’s gone so wrong?

Motley Fool contributor Monica O’Shea has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Nearmap Ltd (ASX: NEA) share price is on watch this morning after the company released its full-year results for FY22.

Shares in the aerial imaging company finished 2.1% higher yesterday, lifting the share price to $1.925.

Nearmap share price primed amid strong growth

• Statutory revenue up 29% year on year to $145.9 million
• Annual contract value (ACV) up 31% to $167.6 million
• Subscription revenue incorporating premium content increased to 73% of the portfolio
• Gross profit up 37% to $111 million
• Net loss widened from $18.8 million to $30.8 million
• Cash balance of $93.7 million at the end of June 2022

Nearmap’s North American operations contributed the lion’s share of ACV portfolio growth during the period. According to the earnings results, North American ACV experienced a significant 45% growth, reaching US$64.3 million.

The company also delivered growth in the Australian and New Zealand (ANZ) region. For the full year, ACV climbed a more modest 8% to $74.3 million. However, Nearmap’s ANZ division touted wider gross margins than North America at 91% compared to 56%.

What else happened in FY22?

The most notable news event for the Nearmap share price during FY22 is probably the most recent. Only two days ago, shareholders were treated to a takeover bid from Thoma Bravo L.P.

Most excitingly, the offer price of $2.10 represents a substantial premium to what Nearmap shares have been trading for. At this stage, the company believes the offer to be credible enough the grant non-exclusive due diligence to Thoma Bravo.

What did management say?

Nearmap CEO and managing director Dr Rob Newman commented on the results, stating:

Nearmap has produced another strong set of results, validating the razor-sharp focus we have on our strategy. Our team continues to successfully execute to this strategy, delivering consistently strong growth from our core industry verticals.

We have now clearly established our market leadership position in the North American market and continue to extend our market leadership position in Australia & New Zealand.

Furthermore, Newman reiterated that the ongoing legal matters in the US have no operational impact, saying:

We’ve delivered these results with a disciplined approach to cash management, ending FY22 in a strong position with $94 million of cash on the balance sheet and no debt. Excluding the impact of the litigation expense related to the US District Court, which I would reiterate continues to have no operational impact on our business, we consumed less than $20m of cash in FY22, lower than initial guidance of $30m.

What’s next?

Management refrained from providing any specific guidance for the next financial year. Although, Newman did note that the Nearmap remains on track to generate positive free cash flow by FY24.

Operationally, the company plans to produce and deliver five HyperCamera3 systems during the first half of FY23.

Nearmap share price snapshot

The Nearmap share price had been in the red for much of this calendar year. However, thanks to the recent takeover bid, shares in the aerial imaging company are now up 25% year-to-date.

For comparison, the S&P/ASX 200 Index (ASX: XJO) is down 6.4% over the same window of time.

The post Nearmap share price on watch as revenue leaps 29% appeared first on The Motley Fool Australia.

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More reading

• Why BlueScope, Carsales, Core Lithium, and Nearmap shares are racing higher
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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Nearmap Ltd. The Motley Fool Australia has positions in and has recommended Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The CSL Limited (ASX: CSL) share price will be one to watch today.

This comes after the global biotherapeutics company released its highly anticipated full-year results.

CSL share price on watch after delivering a mixed performance

This morning, CSL delivered its FY22 results for the 12 months ending 30 June 2022. Here are some of the key takeaways.

• Total revenue up 3% in constant currency to US$10,668 million
• Gross profit down 1% to US$5,786 million
• Net profit after tax (NPAT) down 6% to US$2,236 million
• Full-year dividend of US$2.22 per share, flat year on year
• FY23 guidance: NPAT to grow between 7.6% to 11.8% in constant currency on FY22 NPAT

What happened in FY22?

CSL advised that its FY22 performance was in line with expectations despite a difficult global environment.

Under the CSL Behring portfolio, immunoglobulin and albumin sales were limited by COVID-constrained plasma collections in FY21. However, this didn’t stop CSL Behring achieving sales of US$8,598 million, up 2%.

CSL’s Seqirus business experienced a strong surge in seasonal influenza vaccines, up 16%. A record volume of around 135 million doses was distributed around the world. As a whole, Seqirus revenue jumped to US$1,964 million, up 13% from the prior corresponding period.

The company also updated investors its plasma collection issues.

CSL noted that volume has now exceeded pre-pandemic levels following operating and marketing initiatives that were previously undertaken.

The company opened 27 new centres to attract lapsed and new donors through its doors in FY22.

Furthermore, CSL carefully managed costs and significantly boosted its investment in research and development to US$1,156 million, up 17%.

Management commentary

CSL’s CEO and managing director, Paul Perreault, said:

CSL has delivered a good result at the top end of our guidance, demonstrating our resilient performance against the ongoing challenges presented by the global COVID pandemic.

Despite the uncertain environment, we have carefully managed our costs and significantly boosted our investment in Research and Development, supporting our commitment to providing innovative medicine to patients.

Perreault went on to add:

During FY22, we announced the agreement to acquire Vifor Pharma and we are excited that this acquisition recently closed on 9 August 2022. CSL Vifor adds a high-value and complementary portfolio of products and market leading positions in renal disease and diseases of iron deficiency to CSL.

I remain confident in the value CSL Vifor will bring to CSL shareholders, adding to the sustainability of CSL’s growth.

What’s the outlook for FY23?

One thing that could boost the CSL share price today is its guidance for FY23.

Management is forecasting a strong mid-term outlook as COVID recedes. It also highlighted a promising cluster of R&D programs that are nearing completion.

Perreault commented: 

We have continued to invest in all facets of our business and I am very encouraged by the improved momentum we are seeing in our core immunoglobulin franchise.

The strong growth we have seen in plasma collections is anticipated to continue as COVID recedes and underpin strong future sales growth in our core plasma therapies. The current higher cost of plasma is also expected to prevail into FY23.

We anticipate our influenza business, CSL Seqirus, to deliver another strong year driven by demand for its differentiated products.

CSL’s net profit after tax for FY23 is anticipated to be approximately $2.4 billion to $2.5 billion at constant currency, returning to strong sustainable growth. This excludes CSL Vifor earnings and costs associated with the acquisition.

CSL share price snapshot

Since the beginning of 2022, the CSL share price has moved in circles to post a small gain of 2%.

For context, the benchmark S&P/ASX 200 Index (ASX: XJO) has lost around 4.5% over the same timeframe.

CSL is the ASX’s largest healthcare company and presides a market capitalisation of approximately $142.78 billion.

The post CSL share price on watch following FY22 results appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Looking to buy CSL shares? Here’s what to watch when the biotech company reports this week
• Here are 3 ASX blue-chip shares reporting this week
• Goldman Sachs gives its verdict on the CSL share price
• CSL share price climbs as $16 billion Vifor acquisition becomes effective

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Santos Ltd (ASX: STO) share price will be one to watch on Wednesday.

This follows the release of the energy producer’s half year results for FY 2022.

Santos share price on watch amid huge profit growth

• Revenue up 85% to US$3,766 million
• EBITDAX up 12% to US$2,731 million
• Underlying net profit after tax up 300% to US$1,267 million
• Free cash flow tripled to US$1,708 million
• Interim dividend up 38% to 7.6 US cents

What happened during the first half?

For the six months ended 30 June, Santos delivered an 85% increase in revenue to US$3,766 million and a massive 300% jump in its underlying net profit after tax to US$1,267 million.

This was driven by record production, a big increase in the price of oil and LNG, and the merger with Oil Search.

Speaking of its merger, management advised that its annual merger integration synergies target has now increased to US$110 million to US$125 million.

Another positive was Santos’ free cash flow generation. It reported the tripling of its free cash flow to a record US$1,708 million for the six months.

In light of its strong free cash flow generation, the Santos board declared an interim dividend of 7.6 US cents. This is up 38% compared to the same period last year.

Combined with its previously announced US$350 million on-market share buyback, this means Santos will be returning a total of US$605 million of 18 US cents per share to shareholders.

How does this compare to expectations?

As strong as this result was, it appears to have come in a touch short of expectations.

For example, according to a note out of Citi, its analysts were expecting a net profit after tax of US$1,333 million.

This could potentially weigh on the Santos share price today. Particularly given that energy shares were already likely to come under pressure after a pullback in oil prices overnight.

Management commentary

Santos’ managing director and chief executive officer, Kevin Gallagher, was pleased with the half. He said:

Demand for our products has remained strong in both Australia and internationally, due to increased demand and shortages of supply from producing nations due global underinvestment in new supply.

We are seeing these issues play out in the significant shift in global energy policy towards energy security as a key priority. Our critical fuels not only play a key role in the energy security of Australia and Asia, but they also provide affordable and reliable alternatives to switch from higher emitting fuels.

Today’s results demonstrate the strength of Santos, with strong diversified cashflows and capacity to provide sustainable shareholder returns, fund new developments and the transition to a lower carbon future.

Outlook

Looking ahead, management continues to target production of 102-107 mmboe and costs of US$7.90 to US$8.30 per barrel of oil equivalents for FY 2022. It also held firm with its sustaining capex at ~US$1,100 million.

It has, however, reduced its 2022 major capex guidance to ~US$1,400 to US$1,500 million, including Pikka Phase 1 final investment decision.

The post Santos share price on watch after 300% first half profit growth appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday
• What’s impacting the Santos share price today?
• Is the Santos share price a buy following the energy giant’s latest acquisition?
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Are you interested in adding some more ASX shares to your portfolio this week?

Two ASX growth shares that could be worth considering are listed below. Both have been named as buys by the team Bell Potter. Here’s what you need to know about them:

Altium Limited (ASX: ALU)

The first ASX growth share to look at is Altium. It is a global printed circuit board (PCB) design software provider. Thanks to Altium’s leadership position in a market growing strongly, management has set itself some major growth targets for the coming years.

This includes dominating its industry and growing its revenue to US$500 million by 2026. This will be a big increase from the revenue of US$213 million to US$217 million that it is guiding to in FY 2022.

Bell Potter appears confident the company will achieve its goals. As such, it has put a buy rating and $34.00 price target on its shares.

TechnologyOne Ltd (ASX: TNE)

Another ASX growth share for investors to look at is enterprise software provider TechnologyOne.

It provides its high quality and sticky software to customers in the government, local government, financial services, health & community services, education, and utilities and managed services markets.

TechnologyOne is currently transitioning to become a software-as-a-service (SaaS) focused business with recurring and higher margin revenue. Pleasingly, the transition is going well and management is confident that it will continue to be the case. As a result, it is aiming to almost double its annual recurring revenue (ARR) to $500 million by FY 2026.

The team at Bell Potter are also very positive on Technology One. The broker currently has a buy rating and $14.25 price target on its shares.

The post Broker names 2 ASX growth shares to buy this week appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Better ASX tech buy: Xero or Altium?
• Experts name 2 ASX 200 shares to buy next week
• Here are 2 excellent ASX tech shares a top broker says are buys
• 2 stellar ASX 200 shares that brokers rate as buys

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium. The Motley Fool Australia has recommended TechnologyOne Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Corporate Travel Management Ltd (ASX: CTD) share price is in focus this morning following the release of the company’s financial year 2022 earnings.

The corporate travel specialist’s stock closed yesterday’s session at $21.46.

Corporate Travel Management share price on watch

Here are the key takeaways from the S&P/ASX 200 Index (ASX: XJO) travel company’s year ended 30 June:

• Total revenue came to $388.7 million – 94% higher than that of the prior corresponding period (pcp)
• Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) of $59.8 million – up from a $7.2 million loss
• Net profit after tax (NPAT) came to $3.1 million – up from a $55.4 million loss
• Underlying NPAT reached $17.5 million, coming to fruition in the final quarter
• Total transaction value (TTV) reached $5.1 billion – a 215% improvement
• Revealed a 5 cent per share unfranked dividend – its first post-pandemic payout

Corporate Travel Management reported a profit, albeit a slight one, for financial year 2022.

Indeed, it’s been profitable at an EBITDA level since early 2021. But it was the June quarter that really lifted its bottom line.

The company posted an underlying NPAT of $20.5 million for the quarter ended 30 June. It also boasted $1.8 billion of TTV, $141 million of revenue, and $35.7 million of underlying EBITDA in the final quarter.

It ended financial year 2022 with no debt, $127 million of cash, and strong operating cash flows. It also intends to pay out 50% of NPAT in dividends going forward.

What else happened in FY22?

The major news from Corporate Travel Management in financial year 2022 was of its acquisition of Helloworld Travel Ltd (ASX: HLO)’s corporate and entertainment travel businesses.

The ASX 200 company underwent a $100 million capital raise to fund the purchase. Under the raise, Corporate Travel Management offered new shares priced at $21 apiece.

It also battled border closures brought about by the spread of COVID-19 variants last financial year.

What did management say?

Corporate Travel Management managing director Jamie Pherous commented on the company’s earnings, saying:

Following the removal of most border and travel restrictions globally, the fourth quarter momentum makes us optimistic for the future, and we are pleased that the business has successfully translated that momentum into earnings.

Corporate Travel Management is a different business than it was prior to the COVID-19 pandemic. We are larger, more diverse, and more relevant to our market globally. This gives us an exciting platform from which to continue our organic growth trajectory in financial year 2023 and beyond.

What’s next?

Corporate Travel Management expects to fully recover from the pandemic in financial year 2024, in line with International Air Transport Association forecasts.

That could see it posting $810 million revenue and $265 million of underlying EBITDA, based on pro forma figures.

However, such a recovery isn’t likely to be linear in financial year 2023 due to capacity constraints and travel restrictions in Greater China, both of which are expected to be resolved this fiscal year.

Finally, it noted forward bookings for September are strong in North America and Europe. Meanwhile, TTV is already at pre-pandemic levels in Australia and New Zealand. Finally, a reduction in Hong Kong’s quarantine period from seven to three days brought an increase in activity earlier this month.

Corporate Travel Management share price snapshot

The Corporate Travel Management share price has been performing in line with the broader market in 2022.

It’s dumped 7% year to date, as has the ASX 200.

Though, the stock is trading 1% higher than it was this time last year, while the index has slipped 5% over the last 12 months.

The post Corporate Travel Management share price in focus as dividends return appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Brokers just rated these 2 ASX shares as buys for August
• Top brokers name 3 ASX shares to buy today
• Here are the top 10 ASX 200 shares today
• Why are Flight Centre, Webjet, and other ASX travel shares sinking today?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Helloworld Limited. The Motley Fool Australia has positions in and has recommended Helloworld Limited. The Motley Fool Australia has recommended Corporate Travel Management Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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