Category: Stock Market

The Nanosonics Ltd (ASX: NAN) share price is sinking on Tuesday morning.

At the time of writing, the infection prevention company’s shares are down 6% to $4.45 following the release of its half year results.

Nanosonics share price sinks amid softening performance

• Revenue up 41% over the prior corresponding period to $60.6 million
• Global installed base up 12% to 28,160 units
• Operating profit before tax up from $0.2 million to $3.3 million
• Profit after tax up 160% to $3.9 million
• Profit down 45% half on half

What happened during the first half?

For the six months ended 31 December, Nanosonics reported a 41% increase in revenue to $60.6 million. This comprises a 102% increase in capital revenue to $19 million and a 23% lift in consumables and service revenue to $41.6 million.

However, due to COVID impacting the prior corresponding period, a better reflection of the company’s performance is achieved comparing it to the second half of FY 2021. Management revealed that revenue was up 1% compared to the prior half, with capital revenue up 10% but consumables and services revenue down 3%. This reflects some disruption on ultrasound procedure volumes associated with increasing infections rates from the Delta and Omicron variants of COVID-19 including hospital staff shortages in particular in North America.

It was a similar story for Nanosonics’ earnings. While they were up strongly over the prior corresponding period, they were down sharply half on half.

The company reported profit after tax of $3.9 million. This was up 160% over the prior corresponding period but down 45% over the second half of FY 2021. This was driven by an increase in all aspects of its operating costs. This reflects increased spending directed towards expanding capability across all regions, as well as an increase in research and development expenditure.

Management commentary

Nanosonics’ Chief Executive Officer and President, Michael Kavanagh, commented: “The first half of the 2022 financial year has seen strong growth compared with the first half the 2021 financial year, which was materially impacted by COVID-19.”

“Despite the significant and rapid increase in infections in the first half of FY22 associated with the Delta and more recently the Omicron variants and the associated impacts on hospital staff shortages and procedure volumes, the Company maintained the positive momentum achieved in the second half of FY21,” he added.

Outlook

As previously announced, Nanosonics expects to be impacted by the revision to its sales model in North America. However, it is still expecting to deliver double digit sales growth for the year.

It explained: “The impact is expected to be in the range of $13.0 million to $16.0 million and primarily associated with GE transitioning from a stocking distributor to the new pass-through sales model.”

“Assuming the positive market recovery trends experienced in the second quarter of FY22, which have continued in January, in particular in North America and Europe for new installed base growth and consumables usage, we maintain double digit revenue growth expectations despite the FY22 H2 North American revenue impact of the revised North American sales model.”

However, this growth is unlikely to flow to the bottom line, with management predicting a further increase in its operating expenses during the second half.

It advised: “Operating expenses for the first half were $42.7 million and with the addition of the extra resources in North America associated with the revised sales model, total operating expenses are now likely to be approximately $93.0 million.”

This compares to operating expenses of $70.8 million in FY 2021, which represents an increase of 31.3%.

The post Nanosonics (ASX:NAN) share price sinks amid 45% half on half profit decline appeared first on The Motley Fool Australia.

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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. owns and has recommended Nanosonics Limited. The Motley Fool Australia owns and has recommended Nanosonics Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Helloworld Travel Ltd (ASX: HLO) share price closed the day in the red on Monday after the company released its interim report and financial results for the half-year ended 31 December 2021.

Helloworld shares finished the day 4% down at $2.44 apiece as investors responded poorly to the company’s earnings results on Monday.

Helloworld share price tanks amid earnings growth

Key takeouts from the company’s earnings results included:

• Half-year statutory loss after tax fell to $14.0 million compared to $15.1 million in 1H21
• Travel-related revenue grew $12.5 million on the prior corresponding period (pcp), operating costs declined, and short-term net operating cash outflows remained tightly managed
• Total transaction value (TTV) grew 60.4% on the pcp contributing to a 45.2% increase in travel-related revenues
• Margins remained steady at 6%
• Non-corporate and entertainment travel TTV grew 86.6% on pcp
• Earnings before interest, taxes, depreciation, and amortisation (EBITDA) loss of $5.2 million, down 10.8% or $0.6 million on the pcp
• Net loss before tax was $19.6 million, a decline of $1.9 million on the pcp of $21.5 million
• As at 31 December 2021, the group held cash balances of $87.6 million
• Subsequent to period-end, $7.5 million in previously paid company tax was received
• External borrowings at 31 December totalled $70.8 million after repayment of $10 million in December 2021

What else happened this half for Helloworld?

During the period Helloworld agreed to sell (subject to conditions) the corporate and entertainment travel businesses in Australia and New Zealand to Corporate Travel Management Ltd (ASX: CTD), for an enterprise value of A$175 million.

The company also notes its retail agency networks in Australia and New Zealand “remain steadfastly resilient with a strong presence to capture expected growth in travel demand in 2022 and beyond”.

On the back of strong forward bookings, that have continued to climb, significant leisure bookings are now held for travel through until the end of 2023, Helloworld said.

The group expects demand for inbound travel arrivals heading to Australia, New Zealand, and Fiji to gradually normalise in 2022.

“If travel demand continues to grow on its current trajectory, [the company] should achieve a breakeven position or slightly better in the June quarter of FY22 and return to modest profitability throughout FY23,” it said.

Aside from that, travel-related revenue grew $12.5 million year on year whereas operating costs declined. In addition, TTV grew over 60% on the previous year, “contributing to a 45.2% increase in travel-related revenues”.

“With current liquidity levels and cash burn, HLO has sufficient liquidity to maintain operations and continue to benefit from the recovery of the travel and tourism market and to see that through to full recovery,” Helloworld remarked.

Management commentary

In his address, Helloworld chief executive Andrew Burnes said:

Over the last two years, we have reviewed all parts of our business to ensure we are providing all critical services to our agency, corporate and direct customers while keeping costs to a sustainable level.

As part of this review we identified the opportunity to consider divesting our corporate division and on 15 December 2021, HLO announced it had entered into a binding agreement to sell its corporate and entertainment travel businesses in Australia and New Zealand to Corporate Travel Management for an enterprise value of A$175 million. We believe this transaction is at a compelling valuation to maximise HLO shareholder value and will allow HLO to focus on operations which, pre COVID-19, represented 80% of our TTV. Subject to certain conditions being met, completion is expected to occur during the third quarter of FY22.

What’s next for Helloworld?

The company gave an overview of its company expectations for the coming periods. In the near term, Helloworld notes that “pent up demand for travel is extremely strong and when the impacts of the COVID-19 pandemic on travel finally subside, we anticipate travel will ramp up rapidly, with significant growth in the next 24 months”.

If that were the case then demand for travel services from both retail leisure agents and corporate travel management companies will also soar “in a world where professional and personalised travel advice and management will be critical to travellers’ sense of security and comfort”.

Helloworld says it will continue to incur cash losses of approximately $1–$1.5 million per month for the next three months, based on its current expectations.

According to the company, it has a sufficient cash runway to last “beyond the end of calendar 2022 on current liquidity levels and cash burn rate”.

Subject to satisfaction of the conditions and transaction completion, HLO will receive A$100 million in cash and CTM shares of A$75 million (escrowed 12 months from completion) towards the end of the March 2022 quarter. The cash consideration received will be used to repay debt, provide additional liquidity, capital management and to support growth opportunities in HLO’s retail and leisure travel businesses as activity rebounds following COVID-19 disruption.

Helloworld share price snapshot

In the last 12 months, the Helloworld share price has climbed 8%. However, it is down around 3% this year to date. In the past month, it has gained 9%.

The post ‘Losses minimised’ but Helloworld (ASX:HLO) shares can’t hide from the havoc appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Helloworld Limited. The Motley Fool Australia owns and has recommended Helloworld Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The South32 Ltd (ASX: S32) share price has edged higher since announcing its FY22 half year results last Thursday.

The mining outfit delivered strong earnings growth along with a bumper dividend which pleased investors.

Although at yesterday’s market close, South32 shares finished 0.22% lower to $4.56, they are around 2.5% higher since 17 February. This is when the diversified metals miner released its results to the ASX.

What’s the details with the South32 dividend?

In the half year report for the 2022 financial year, South32 reported strong performance across key metrics.

In summary, group statutory profit after tax increased by US$979 million to US$1,032 million in H1 FY22. The company benefited from portfolio changes completed in FY21, as well as a broad recovery in commodity prices.

Underlying earnings jumped by US$868 million to US$1,004 million through higher average realised prices for commodities, particularly metallurgical coal. The latter attributed US$526 million over the period to South32’s coffers.

The group also achieved a US$704 million increase in free cash flow from operations, excluding EAI, to US$840 million.

Overall, the company finished the first half with a net cash of US$975 million, up from US$406 million in the prior year.

The Board declared a fully franked interim dividend of US 8.7 cents per share. This represents a 621% jump from the US 1.4 cents declared in H1 FY21.

Management noted that the latest dividend equates to a payout ratio of 40% of cash earnings.

The company’s dividend policy is to distribute a minimum 40% of cash earnings in half financial year.

It is worth noting that there is a capital management program that has been active since FY18. This returns excess capital efficiently through an on-market share buyback.

The Board further expanded its capital management program by US$110 million to US$2.1 billion, leaving US$302 million to be returned by 2 September 2022.

When can South32 shareholders expect payment?

South32 will pay the interim dividend to eligible shareholders approximately 6 weeks away on 7 April.

To be eligible for the latest dividend, you’ll need to own South32 shares before the ex-dividend date on 10 March. This means if you want to secure the dividend, you will need to purchase South32 shares on or before 9 March.

In case you are wondering, the company is not offering a dividend reinvestment plan (DRP) to shareholders.

The post Banking on the South32 (ASX:S32) dividend? Here’s what you need to know appeared first on The Motley Fool Australia.

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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 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 Bruce Jackson.

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Shares in Sonic Healthcare Limited (ASX: SHL) finished the day down on Monday after the company released its financial results for the half year ended 31 December 2021.

The Sonic Healthcare share price finished the day 3.59% down at $36.25 on Monday after collapsing early in the session.

Sonic Healthcare share price slips despite strong growth

The company outlined several investment highlights, including:

• Revenue growth of 7% to $4.8 billion
• Earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 18% to $1.5 billion
• Net profit growth of 22% to $828 million
• Record financial performance driven by pandemic testing and base business growth
• $585 million invested in synergistic acquisitions/joint ventures in the period with active pipeline of further opportunities
• Base business revenue (ex-COVID testing) up 4.3% versus H1 FY2021 and 2.5% versus H1 FY2020 (constant currency, organic growth)
• Gearing at record low level, approximately $1.4 billion of available liquidity, on-market share buy-back announced as part of active capital management
• Dividend increase of 4 cents (11%) to 40 cents (100% franked) for the FY2022 interim dividend.

What else happened this half for Sonic?

Sonic’s total revenue growth for the half year was 7%, “enhanced by COVID-19 testing revenue in Sonic’s Laboratory division” the company said.

Excluding COVID-19 testing, base revenue grew by 4.3% versus the same period last year, and 2.5% versus H1  – what Sonic calls the pre-pandemic.

While sales grew this half, EBITDA also grew 18%, driven mainly by operating income growth of 20% in the company’s laboratory division, again enhanced by COVID-19 testing.

As such, laboratory division margins lifted off by almost 400 basis points from 30.8% to 34.3%. However, radiology margins were lower “due to pandemic impacts and the relatively low margin of the acquired EMI business”.

The company was pleased with the results that were seen vertically down throughout the profit and loss statement, particularly in terms of efficiency and growth.

“Net profit growth of 22% on 7% growth in revenue demonstrates the operating leverage in Sonic’s businesses”, the company remarked.

Management commentary

Speaking on the announcement, Sonic CEO Dr Colin Goldschmidt said:

Sonic Healthcare’s 38,000 staff have produced outstanding operational and financial performances in the last six months through their unwavering commitment to the tenets of Sonic’s Medical Leadership culture, promoting the provision of exceptional healthcare services. The COVID-19 pandemic continued to throw up new challenges on almost a daily basis, and our people responded magnificently. I sincerely thank all of our staff for their dedication and flexibility during these trying times.

What’s next for Sonic?

Sonic announced on 21 February 2022 that it wanted to undertake an on-market share buy-back of its shares. It has the approval of up to $500 million, per the release.

Aside from that, no formal guidance was provided by the company.

Sonic Healthcare share price snapshot

In the last 12 months, the Sonic Healthcare share price has climbed 9.09%. This year to date, however, it has struggled and is down 22%.

Even in the past month, shares have fallen almost 7% and are sliding by around 3% over the previous week of trading.

The post Record financials not enough: Sonic Healthcare (ASX:SHL) share price sinks post-earnings appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow 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 recommended Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Reliance Worldwide Corporation Ltd (ASX: RWC) closed Monday up marginally after the company released its interim report and financial results for the half year ended 31 December 2021.

The RWC share price finished the day less than 1% in the green at $5.13 following the release of its earnings results today.

RWC share price flat amid earnings growth

Key takeouts from the company’s earnings results include:

• 12% growth in reported Net Sales to US$522 million over the prior corresponding period (pcp)
• Americas growth of 15% over pcp including an initial contribution from EZ-FLO which was acquired in November 2021
• Asia Pacific constant currency sales up 10% on pcp driven by strong Australian residential construction and remodel activity
• Continental Europe sales up strongly, while the UK saw lower volumes following a strong period of growth in the pcp
• Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of US$125.5 million, up 5% on pcp
• Adjusted net profit after tax (NPAT) of US$75.4 million, up 5% on pcp

What else happened this period for RWC?

The company’s performance this half was hallmarked by NPAT of US$63.7 million for the six months whereas Adjusted NPAT spiked 5%, up to US$75.4 million.

The result enabled RWC’s board to declare an interim dividend of US4.5 cents per share, slightly down on previous payments in 2021.

However, RWC wasn’t immune to the impacts that global supply chain pressures had on commodity prices in 2021. Rising costs for materials like copper, resins, and steel, were experienced during the period “together with higher costs for freight, packaging, energy and other costs”.

Whilst the company attempted to pass the costs onto consumers versus absorbing it themselves, it remains to be seen whether RWC has the pricing power in its segment to pull this off successfully.

“Price rises were implemented during the period to substantially offset these increased costs, although the timing lag between higher input costs being incurred and offsetting price increases negatively impacted operating margins”, it remarked.

In good news, the period included the first contribution from EZ-FLO, which was acquired back in November 2021. The segment contributed sales of US$22.5 million and EBITDA of US$2.3 million recorded for the 6-week period post-acquisition, RWC says.

Management commentary

Speaking on the announcement, RWC Chief Executive Officer Heath Sharp said:

We continued to experience robust market conditions and demand for our products. The trend of increased spending on home remodelling activity, coupled with strong new residential construction markets, has underpinned record levels of demand. We were able to consolidate our volumes following a period of exceptional growth in 2021. Importantly, we were able to meet our customer’s service and delivery expectations despite the increased incidence of COVID and supply chain challenges.

What’s next for RWC?

So far, this year to date, trends have been “broadly consistent with the trends seen in the first half”, the company said, although results have been mixed.

“Americas sales, excluding EZ-FLO, were higher than the same month last year reflecting ongoing strong demand and performance ahead of market. APAC external sales continued to benefit from ongoing strength in the residential construction and remodelling markets in Australia”, it said.

“Europe, Middle East and Africa (EMEA) also continued the trajectory of the first half with the overall result in line with the prior January”.

RWC share price snapshot

In the last 12 months, the RWC share price has climbed 8% but has struggled since trading recommenced on January 4. Since then it has collapsed over 18%.

The post ‘Record demand’ not enough to lift RWC (ASX:RWC) share price on Monday appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Reliance Worldwide Corporation Limited. The Motley Fool Australia has recommended Reliance Worldwide Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Event Hospitality and Entertainment Ltd (ASX: EVT) closed Monday in the green after the company released its interim report and financial results for the half year ended 31 December 2021.

The EVT share price finished Monday 5% higher at $15.30 as investors bought in following the release of its earnings results.

EVT share price lunges higher amid earnings growth

Key takeouts from the company’s earnings results include:

• Group normalised revenue was $438 million, up $155.1 million or 54.8% on the previous year
• Normalised EBITDA was $64.1 million, up $95.1 million on the prior comparable half year
• Statutory profit after tax was $33.3 million, a $93.6 million improvement on the prior comparable half year reported loss.
• Divestments in non-core assets on-track: $194.4 million to date, with gross proceeds to date exceeded most recent valuations by 35.1%.
• Divestments and improved trading performance reduced net debt to $292.3 million at 31 December 2021, consistent with pre-COVID-19 levels.

What else happened this half for EVT?

The company noted that it faced “materially tougher government mandated restrictions than [the] prior comparable period”, like all businesses in Australia during 1H FY22.

Nevertheless, group revenue can in almost 55% higher year on year at $438 million, although that figure reduces to just 35% when backing out the German Government’s Bridging Aid III support the company received.

EVT also said its entertainment businesses benefited from |pent-up demand for the cinema experience and strong performance of key blockbuster films Spider-Man: No Way Home and No Time to Die.

EVT owns the largest cinema circuits in Australia, New Zealand and Germany under the brands Event Cinemas, Greater Union, Moonlight Cinemas and CineStar just to name a few.

And weren’t the group’s growth initiatives on fully display this half as well, particularly through add-on sales generated from its ‘Cinema of the Future’ agenda.

“Implementation of the Cinema of the Future strategies to leverage this demand resulted in customers spending
more each visit and generated a higher profit per customer on a like film basis”, it said.

Aside from this, the group says it continued to make good progress on the divestment strategy with sales in the half year realising gross proceeds of $107.9 million. Cumulatively, the company has now generated gross proceeds of $194.4 million, “exceeding the most recent valuations by 35.1%”.

Management commentary

Speaking on the announcement, EVT CEO Jane Hastings said:

In this half year period, the Group navigated materially greater government lockdowns and restrictions than the prior comparable period. Despite this, the transformation strategies and actions we have completed over the past few years, ensured we are agile and able to respond to the ever-changing landscape. This is evident in the revenue growth and EBITDA turnaround for the Group in this period, which included $75 million of active cost management. Our new business models are already delivering evidence of improved margins which we expect to continue post the pandemic. We have a strong balance sheet and Group net debt is down to pre-COVID level. We are in a strong position to navigate current challenges and invest for growth. I am incredibly proud of the entire EVT team and the way everyone continues to innovate and adapt to deliver the best possible results.

What’s next for EVT?

Commenting on the outlook for 2022, Hastings noted that demand for the cinema experience will remain strong when restrictions are lifted. Based on its current pipeline, the company expects box office revenue “to exceed that achieved in the second half of the prior financial year” for H2 FY22.

Signs of recovery for Hotels were evidenced in the December trading period before Omicron, including pleasing growth in the average room rate, and in Australia, corporate travel is expected to gain traction from April. Thredbo’s summer season is tracking relatively in line with the prior summer season. Overall, our underlying Group EBITDA in the second half last year was approximately $15 million excluding the German Government’s November and December 2020 aid program, and we expect underlying Group EBITDA in the second half this year to demonstrate a strong improvement on that result, subject to no further government trading restrictions.

EVT share price snapshot

In the last 12 months, the EVT share price has climbed 47% after spiking another 3% this year to date. In the past month, it has also soared almost 10% and is in the green across all time frames.

The post Strong rebound sees EVT (ASX:EVT) share price lunge 5% higher on Monday appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow 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 Bruce Jackson.

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The RPMGlobal Holdings Ltd (ASX: RUL) share price is hovering in positive territory so far this week.

While the All Ordinaries (ASX: XAO) gained just 0.06% on Monday, sitting at 7,507 points, RPMGlobal shares managed to leap 2.22% to close the day at $1.84.

This follows the release of the mining software company’s first-half results for the 2022 financial year.

Let’s take a look at what RPMGlobal reported for the front end of FY22.

RPMGlobal share price advances after booking growth across key metrics 

The RPMGlobal share price pushed higher on the back of the company’s latest results.

For the 6 months ending 31 December 2021, RPMGlobal achieved growth despite COVID-19 impacting the business. Here are some of the key highlights:

• Total group revenue of $40.5 million, up 12% on the prior six-month period (H2 FY21)
• Underlying operating earnings before interest, tax, depreciation and amortisation (EBITDA) of $3.9 million, up 457% on H2 FY21
• Net profit of $1.9 million, up $8.3 million on H2 FY21
• No interim dividend declared for the first half.

What happened in H1 FY22 for RPMGlobal?

RPMGlobal experienced a strong first-half operating performance, driven by an increase in software revenue and advisory revenue. The segments delivered earnings of $27.8 million, up 23.6%, and $12.7 million, up 64.9%, respectively on the prior year.

Operating expenses came to $34.2 million for the first half due to the acquisition of two Environmental and Social Governance businesses. These were Nitro Solutions and Blueprint Environmental Strategies, for which RPMGlobal paid a total of $3.9 million in completion payments.

The group has been focusing on moving its software solutions into the cloud which resulted in higher development costs.

At the end of the period, RPMGlobal recorded net assets of $65.8 million, including cash of $32.4 million and no debt.

What’s the outlook for RPMGlobal?

Looking ahead, RPMGlobal believes operations will return to normal settings by July following the gradual reopening of borders.

The company estimates that a lift in software sales will materialise once mining countries are open for business.

Management noted that selling complex software solutions to global companies is best done in person rather than online.

The company’s ESG division is expected to continue performing in the second half, heavily contributing to revenue in the advisory segment.

While the company maintains a positive outlook, given the unpredictable nature of the pandemic, RPMGlobal refrained from providing FY22 full-year earnings guidance.

The post Why the RPMGlobal (ASX:RUL) share price is edging higher this week appeared first on The Motley Fool Australia.

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• Clinical trials not enough to stop Noxopharm (ASX:NOX) shares’ 5% plunge on Monday
• Coles (ASX:COL) share price on watch after COVID costs hit earnings
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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. owns and has recommended RPMGlobal Holdings. The Motley Fool Australia has recommended RPMGlobal Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Noxopharm Ltd (ASX: NOX) closed the day in the red after the company released its interim report and financial results for the half year ended 31 December 2021.

The Noxopharm share price finished the day 5% down at 38 cents as investors responded poorly to the release of its earnings results today.

Noxopharm share price as clinical trials progress

Key takeouts from the company’s earnings results today include:

• Strong cash position of A$22.6m due to continued judicious expenditure in the best interest of the company and its shareholders
• This amount includes $5.9 million R&D tax incentive for FY21 received in January 2022, considered non-dilutive funding for the company
• Increased investment in R&D of $8.3m compared to $3.0 million in 1HFY20 to advance the clinical trial programs
• DARRT Program Phase 2 clinical trial (Veyonda with low-dose radiotherapy received IND approval from the FDA

What else happened this half for Noxopharm?

The company’s progress was hallmarked by clinical trial and drug discovery momentum, particularly as R&D expenditure increased by over $5 million to support these programs.

Noxopharm says that its clinical trial sites “include some of the leading cancer centres in the world, notably, the US number one cancer hospital, the MD Anderson Cancer Center…as well as the Beverly Hills Cancer Center and the City of Hope Cancer Center”.

During the half, Noxopharm’s DARRT Program Phase 2 clinical trial, investigating Veyonda with low-dose radiotherapy, received investigational new drug (IND) approval from the Federal Drug Administration (FDA).

As such, the company says the trial is underway at two leading U.S. cancer centres – the MD Anderson Cancer Center and the Beverly Hills Cancer Centre. The patient cohort has already completed first dosages and completed the safety assessments, so updates should be on the way later this year.

Not only that, but Noxopharm made progress on the IONIC Phase 1 trial it is conducting with Bristol Myers during the half. The trial is investigating Veyonda with the Bristol Myers Squibb checkpoint inhibitor, nivolumab, that sells under the brand name Opdivo.

Patients have already been enrolled and treated at the first clinical site the company says, and more sites are expected to open in H1 2022.

Management commentary

Speaking on the announcement, incoming CEO of Noxopharm, Dr Gisela Mautner said:

As incoming CEO, it is pleasing to report that Noxopharm is in a strong cash position with a number of promising programs underway. Our Clinical Portfolio, investigating the combination of Veyonda® with established cancer treatments, is tracking to plan. It is also important to note the relationships we have secured with national and international partners such as Hudson Institute of Medical Research and the US National Cancer Institute, as well
as several prestigious clinical study sites in the USA.

What’s next for Noxopharm?

The company will endeavour to progress in its clinical trial and drug discovery programmes as outlined in its earnings report on Monday.

Noxopharm did not provide any specific earnings or cost guidance for the remainder of FY22.

Noxopharm share price summary

In the last 12 months, the Noxopharm share price has plunged 52% and sits 3% in the red since we started trading in 2022.

Over the previous month, shares have faltered another 9% and are down 9% this past week too.

The post Clinical trials not enough to stop Noxopharm (ASX:NOX) shares’ 5% plunge on Monday appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow 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 Bruce Jackson.

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The Coles Group Ltd (ASX: COL) share price will be on watch this morning.

This follows the release of the supermarket giant’s half year results.

Coles share price on watch after earnings decline

• Revenue up 1% to $20,785 million
• Earnings before interest and tax (EBIT) down 4.4% to $975 million
• Profit after tax down 2% to $549 million
• Fully franked interim dividend flat at 33 cents per share

What happened during the first half?

For the six months ended 31 December, Coles reported a 1% increase in revenue to $20,785 million. Management advised that this reflects elevated sales as a result of lockdowns across New South Wales, the Australian Capital Territory and Victoria, as well as a strong Christmas trade period in the Supermarkets and Liquor segments.

It is also worth highlighting that this sales growth was delivered despite Coles cycling significantly elevated COVID-19 related sales in the prior corresponding period.

Things weren’t quite as positive for its earnings. Coles reported a 4.4% decline in EBIT to $975 million for the half. This was caused by higher COVID-19 disruption costs, related travel restrictions on Express’ earnings, and transformation project costs.

In respect to COVID-19 costs, Coles estimates that a total of $150 million of COVID costs were incurred during the period. This is up from $105 million in the prior corresponding period.

In addition, approximately $20 million of implementation operating costs attributable to the Witron and Ocado transformation projects were incurred. Though, Smarter Selling benefits in excess of $100 million were delivered during the period.

Overall, this EBIT result appears to have fallen a touch short of expectations. For example, the team at Morgans was forecasting a 3% reduction in EBIT to $988 million.

Segment performance

In respect to its segments, the Supermarkets segment reported a 1.1% increase in sales to $18,016 million and a 0.8% reduction in EBIT to $896 million.

Whereas the Liquor segment reported a 2.7% lift in sales to $1,999 million and a 4.8% reduction in EBIT to $99 million, and the Express segment posted an 8.5% decline in sales to $578 million and a sizeable 62.5% reduction in EBIT to $12 million.

The latter was impacted by lower fuel volumes due to restrictions on movements during COVID lockdowns.

Outlook

No guidance has been given for the second half but management has provided an update on current trading conditions.

It said: “As Omicron spread through the community in the early part of January, Supermarkets sales were elevated before moderating later in the month. There has been significant variation in sales performance between states, store locations and on a week-to-week basis as a result of COVID-19 and floods in South Australia which have had an impact on sales, particularly in Western Australia. Coles will continue to focus on providing trusted value for customers, including through Exclusive to Coles products, despite increasing cost pressures.”

“While the current operating environment remains uncertain, COVID-19 costs of approximately $30 million were incurred in January, primarily due to the large number of COVID-19 related isolations, which have now moderated in February,” it added.

The post Coles (ASX:COL) share price on watch after COVID costs hit earnings appeared first on The Motley Fool Australia.

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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 owns and has recommended COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Is the Webjet Limited (ASX: WEB) share price a candidate to take off in 2022?

Well, it already has surged in the last few weeks. Since 27 January 2022, the Webjet share price has jumped 29%.

What is driving the Webjet share price higher?

It was announced on 7 February 2022 that Australia would reopen to all fully vaccinated visa holders, welcoming the return of tourists, business travellers and other visitors from 21 February 2022. That was yesterday.

Visa holders who are not fully vaccinated will still require a valid travel exemption to enter Australia, and will be subject to state and territory quarantine requirements.

Webjet has long said that closed borders cause a significant impact on profit.

A few months ago, Webjet said that demand was already “snapping back” and that there was a rapid return to high booking volumes as borders reopened. WebBeds was profitable since July, whilst the Webjet online travel agency (OTA) returned to profitability in October 2021.

What does the outlook look like?

The ASX travel share is intent on capitalising on the travel recovery. Management believe that its geographic diversification has become a core strength as different regions recover at different times and the market opportunity has increased for all businesses.

WebBeds – the business to business (B2B) segment – was seeing November total transaction value (TTV) tracking at 63% of pre-COVID sales yet many key markets were still to open. It’s not the same business as it was pre-COVID, it has expanded its geographic presence in the North American market, added significant domestic inventory globally and signed a range of new customers.

WebBeds is on track to be 20% more cost efficient when at scale, which will come with a targeted earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 62.5%. This could be supportive for the Webjet share price.

Webjet OTA is also “positioned well for growth” with bookings picking up and the opportunity to capture market share.

The Webjet boss John Guscic said:

The opportunities are significant with pent-up demand evident globally as we see travel snapping back as markets open. Our reduced cost base, enhanced technology and strong customer service ethos, in conjunction with a culture of constant product innovation, places us in a powerful position to capture bookings as the recovery continues. Our strong capital base also ensures we can take advantage of strategic opportunities as they arise in a realigned and changing global industry.

For example, it recently announced a US$10 million strategic investment in ROOMDEX, a US-based leader in automated hotel upselling solutions. Webjet has secured a 49% stake with a future option to acquire the remaining 51%. WebBeds plans to offer ROOMDEX products to maximise hotel partners’ revenue from every room sold.

Broker opinions on the Webjet share price

Morgans rates Webjet as a buy, with a price target of $6.60. That’s a potential double digit upside this year.

Ord Minnett is even more positive on the business, with a buy rating and a price target of $7.31. That’s upside of more than 20%.

The post Is the Webjet (ASX:WEB) share price about to fly higher? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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 recommended Webjet Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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