Category: Stock Market

The IGO Ltd (ASX: IGO) share price is climbing higher on Tuesday after the Aussie miner’s latest full-year results.

In early trade today, IGO shares are up 1.26% to $9.64.

IGO share price on rise after profit and revenue surge

IGO provided its results for the year ended 30 June 2021 (FY21) this morning. Some of the key takeaways include:

• Revenue from continuing operations up 12% on the prior corresponding period (pcp) to $671.7 million
• Earnings before interest, taxes, depreciation and amortisation (EBITDA) up 3% on pcp to $474.6 million
• Net profit attributable to parent up 254% on pcp to $548.7 million
• Profit from continuing operations up 35% to $116.8 million
• Net operating cash flow up 12% on pcp to $446.1 million
• 10 cents per share final (and therefore full-year) dividend compared to 11.0 cents in FY20.

The IGO share price is climbing in early trade following the miner’s latest update.

What happened in FY21 for IGO?

Higher realised metal prices helped boost revenue and profits for the Aussie miner in FY21. IGO also generated $431.9 million in net profit after tax from its discontinued Tropicana Operation during the year. That was due to an after-tax gain of $384.8 million after the sale to Regis Resources Limited (ASX: RRL).

Higher gold prices offset lower production and sales volumes to boost associated earnings during the year.

IGO reported 22,051 tonnes of nickel, 10,752 tonnes of copper, and 454 tonnes of cobalt sold from its Nova Operation in FY21. The group reported average realised prices per tonne on each commodity of A$21,986, $10,974, and $52,057, respectively.

The group announced the completion of its 49% acquisition of Tianqi Lithium Energy Australia Ltd on 30 June which boosted the IGO share price higher.

What did management say?

Managing director and CEO Peter Bradford commented on the results possibly driving the IGO share price:

FY21 was a highly successful and transformational year for IGO, with the continued delivery of strong operating and financial performance, while also delivering two transactions to transform IGO into a business 100% focused on metals critical for enabling clean energy.

We delivered record outcomes across all key financial metrics in FY21, which was attributable to continued outstanding performance at Nova and continued delivery from Tropicana through to the divestment of our interest to Regis in May 2021.

Going forward we remain committed to further growth to deliver a diversified portfolio of clean energy metal products, and to do this with a combination of exploration and disciplined mergers and acquisitions.

What’s next for IGO and its share price?

IGO previously provided FY22 guidance for its Nova Operation in Western Australia and exploration expenditure. The group is targeting 25,000 to 27,000 tonnes of nickel, 11,500 to 12,500 tonnes of copper, and 900 to 1,000 tonnes of cobalt in FY22.

The IGO share price has rocketed 44% higher in 2021 and is outperforming the S&P/ASX 200 Index (ASX: XJO) year to date.

The post IGO (ASX:IGO) share price jumps following 35% profit surge appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Western Areas (ASX:WSA) share price falls after last year’s $32 million profit turns to $8 million loss
• Why Charter Hall, IGO, Vulcan, & Z Energy shares are storming higher
• IGO (ASX:IGO) share price climbs on lithium production update
• Can the Western Areas (ASX:WSA) takeover prompt BHP (ASX:BHP) to go nickel shopping?

Motley Fool contributor Ken Hall 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.

from The Motley Fool Australia https://ift.tt/3gNTQ4d

One of InvoCare Limited (ASX: IVC)’s business units saw a stunning 1600% increase in revenue in just 12 months.

The funeral business reported strong numbers for the half-year ending June 30, increasing revenue, earnings and profit. In fact, the results were so good the share price spiked up 8.7% on Monday.

That’s despite COVID-19 restrictions hitting the industry hard, especially on the east coast.

But perhaps the success can be attributed to a niche part of InvoCare’s operations.

Saying goodbye to our furry friends

In a presentation to the market, InvoCare revealed that its pet cremations business brought in $13.7 million in operating revenue for the June half-year.

That’s a stunning 17-fold increase from just $800,000 one year earlier.

According to the presentation, Australians buying more pets during coronavirus lockdowns the past couple of years has given this business a massive boost.

InvoCare also launched an e-commerce platform and invested in new pet cremators in Victoria and Western Australia to improve its capacity.

The company is also working on signing agreements with vet practices to receive business.

The pet cremation unit also saw its operating earnings before interest, taxes, depreciation, and amortisation (EBITDA) rocket from negative $300,000 to $3.6 million for the June half.

The EBITDA margin is now a chunky 27%. The average amount spent on a pet cremation is $332.

COVID-19 still causing great uncertainty for InvoCare

As for humans, funeral numbers remain below pre-pandemic levels. 

With Australians largely staying home and practising social distancing, influenza has been suppressed the last 2 winters.

Therefore, InvoCare declined to provide earnings guidance for the current financial year.

But the company reiterated the long-term potential of the funeral industry, citing the ageing population and its strong cash balance.

InvoCare listed on the ASX in 200 and the stock has risen 539% since then. The company’s shares have risen nearly 22% in the past 12 months as investors bet on it as a post-COVID ‘reopening’ beneficiary.

The post ASX company’s crack unit rakes in 1600% revenue growth appeared first on The Motley Fool Australia.

More reading

• Which ASX companies are starting off the week as the top movers in the ASX 300 today?
• Why Adore Beauty, Fortescue, InvoCare, & Temple & Webster are charging higher
• ASX 200 midday update: Fortescue result and dividend impress, Altium sinks
• InvoCare (ASX:IVC) share price jumps 9% after reporting strong first half growth
• These are the 10 most shorted ASX shares

Motley Fool contributor Tony Yoo 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 InvoCare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3zuSbrJ

The Bubs Australia Ltd (ASX: BUB) share price is under pressure on Tuesday following the release of its full year results.

In morning trade, the struggling goat milk infant formula company’s shares are down 7% to 39 cents.

Bubs share price sinks after posting $74.7 million loss

• Revenue down 24% year on year to $46.8 million
• Underlying EBITDA loss of $28.5 million
• Statutory loss after tax of $74.7 million
• Cash balance of $27.9 million

What happened in FY 2021 for Bubs?

For the 12 months ended 30 June, Bubs reported a 24% decline in revenue to $46.8 million. This was driven by a 44% decline in Australian sales to $20.4 million and a 17.5% decline in China sales to $10.47 million.

Things were much worse on the bottom line, with the company posting a massive loss after tax of $74.7 million. The latter appears to be weighing heavily on the Bubs share price today. However, it is worth noting that some of this loss reflects a $44.6 million non-cash impairment relating to the Nulac Foods cash generating unit and Deloraine Dairy cash generating unit. This was driven by the conservative outlook the company has adopted over next five years due to the prolonged uncertainties.

On an underlying basis, Bubs reported an operating loss of $28.5 million. This reflects its weaker sales, a $12.6 million inventory write down, and the sale of excess bulk powder at a loss to maximise its cash conversion.

This left Bubs with a cash balance of $27.9 million, which management believes is sufficient to fund its FY 2022 growth plans. Though, that seems unlikely to ease concerns that the company will require yet another capital raising in the near future. This could be another factor weighing on the Bubs share price today.

What did management say?

Bubs’ Founder and Chief Executive Officer, Kristy Carr, said: “There is no doubt that the disruptions caused by the COVID-19 pandemic significantly impacted our performance, with international border closures triggering a severe demand shock and sharp decline in revenues in the first quarter, followed by subdued Daigou sales throughout the remaining three quarters. In addition, we experienced disruption and increased costs associated with outbound international supply chain logistics.”

“As we pivoted to new ways of doing business, resetting our supply chain, and working closely with our key domestic and international trading partners, our agility and resilience have underpinned our momentum toward a rebuild phase, following the setback in the first quarter. The strategies implemented to redirect product through the eco system led to an uplift in the second half delivering ten percent half-on-half growth, and we can report that our fourth quarter gross revenues were only four percent below the fourth quarter of FY20.”

Mrs Carr added: “In response to the COVID driven demand shock, we followed a strategy of resisting pressure to push inventory to distributor channels and instead took the position of discounting sales of bulk powder to clear excess inventory and prioritise cash conservation. This enabled the Company to return to a balanced inventory position, with milk supply rightsized to match stabilised offtake demand forecasts.”

What’s next for Bubs?

No guidance has been provided for the year ahead. However, Bubs appears optimistic it could be a better year.

Bubs’ CEO Kristy Carr commented: “Bubs is well placed with strong foundations, brand share growth, and a robust balance sheet to go forward with a sustainable growth strategy as the Australian lead challenger brand in infant nutrition.”

“The company is now well placed to go forward and we expect to see growth momentum across all channels in FY22.”

Bubs share price performance

The Bubs share price has unfortunately destroyed significant wealth over the last 12 months.

Following today’s decline, the Bubs share price is now down 58% over the period.

The post Bubs (ASX:BUB) share price sinks 7% after posting $74.7 million loss appeared first on The Motley Fool Australia.

More reading

• Why the Bubs (ASX:BUB) share price is zooming 7% higher today
• The Bubs (ASX:BUB) share price has fallen 17% in a month. Here’s why
• Why Bubs, Mayne Pharma, Paradigm, & PointsBet shares are tumbling lower
• Leading brokers name 3 ASX shares to sell today
• ASX 200 Weekly Wrap: ASX grinds to a halt following new all-time high

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 recommended BUBS AUST FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3zCjosI

The Webjet Limited (ASX: WEB) share price is on the move on Tuesday.

At the time of writing, the online travel agent’s shares are up 4% to $5.72.

Why is the Webjet share price rising?

Investors have been bidding the Webjet share price higher today following the release of a trading update ahead of its annual general meeting.

That trading update reveals that the company’s WebBeds business returned to profitability during the month of July. Pleasingly, it has continued to be profitable in August and is expected to remain profitable in September.

This follows a sharp rise in WebBeds total transaction value (TTV) over recent months. After being as low at $18 million in February, the segment’s TTV hit $55 million in June and then $96 million in July. The latter is just ahead of its break-even point.

Pleasingly, August has been even better, with its TTV expected to reach $113 million this month. This will be approximately 50% of its pre-COVID TTV levels.

What about other segments?

The Webjet OTA business was profitable for much of the year but recent lockdowns have ended this streak. However, management notes there is significant demand for leisure travel and pent-up demand for international travel.

Another positive, which could be supporting the Webjet share price, is that management notes that the pandemic is accelerating the structural shift to online booking. This is good news for the company given that its Webjet OTA business is the number one player in the ANZ market.

Elsewhere, it has been a similar story for its smaller Online Republic business which has become unprofitable again. However, management is confident its performance will rebound once lockdowns end.

Management commentary

Webjet’s Managing Director, John Guscic, said: “Our post-Covid strategy is delivering results and the Company will be operating cash flow positive for the first half of Financial Year 2022. The WebBeds business was profitable in July and August and is well on track to be profitable in September.”

“We have seen strong demand as travel restrictions ease in North America and Europe, suggesting significant upside as more international markets reopen. Webjet OTA was profitable for April to July but has been subsequently impacted by the current lockdowns in Australia and New Zealand.”

“Online Republic was profitable in April and May, but like the Webjet OTA, has been impacted by lockdowns. However, we are confident that both businesses will return to profitability as soon as the domestic Australian and New Zealand markets reopen.”

Mr Guscic remains very positive on Webjet’s long term growth prospects.

He said: “We see a world of opportunity for Webjet. All our businesses have significant potential to grow market share by expanding into new market segments and benefiting from consumers shifting to buy travel online. Transformation initiatives are underway and we on track to reducing costs by at least 20% once the Company gets back to scale.”

“As a result, as conditions normalise, we believe our Webjet businesses will have higher market share, lower costs and greater profitability. While the exact timing is uncertain as our growth opportunities are driven by the opening of borders, we know demand for travel will return and we are absolutely ready to capture it,” he concluded.

The post Webjet (ASX:WEB) share price higher on positive trading update appeared first on The Motley Fool Australia.

More reading

• 2 online ASX shares expecting big things
• Why this leading broker sees value in the Webjet (ASX:WEB) share price
• These are the 10 most shorted ASX shares
• It has been a great week for the Webjet (ASX:WEB) share price
• Here’s why the Webjet (ASX:WEB) share price is taking off today

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 shares of and 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.

from The Motley Fool Australia https://ift.tt/3zqC2U9

The CSL Limited (ASX: CSL) share price has pushed almost 6% ahead following the release of the company’s full-year results.

This comes after the global biotech company recorded another robust performance despite navigating through challenging conditions brought on by the Covid-19 pandemic.

At Monday’s market close, the CSL share price finished the day slightly down 0.24% to $310.30. It’s worth noting the company’s share price is just 3.2% short of its 52-week high achieved in November 2020.

What did CSL report?

A little more than a week ago, CSL provided investors with a detailed update on its business operations. The CSL share price initially dipped on the announcement but has since recovered to push higher.

The company noted that its CSL Behring’s portfolio faced headwinds, while its Seqirus business recorded strong tailwinds in FY21. The latter deals in seasonal influenza vaccines.

Under the CSL Behring banner, sales of its leading subcutaneous immunoglobulin product, Hizentra, grew 15%. In addition, sales of hereditary angioedema product, Haegarda, lifted 15%. This contributed to overall revenue of US$8.8 billion for the CSL Behring portfolio, up 6% on FY20.

CSL’s Seqirus business experienced a strong surge in seasonal influenza vaccines, up 41%. A record volume of around 130 million doses was distributed around the world. As a whole, Seqirus revenue jumped to US$1.7 billion, up 30% from the prior corresponding period.

In other news possibly affecting the CSL share price, investors were updated on the company’s plasma collection issues.

The company noted that federal government stimulus packages from early 2021 had driven down the number of donors per week. This momentarily affected plasma levels before soaring again on the back of vaccine momentum, further marketing initiatives, and a “stimulus burn-off”.

As such, plasma collection numbers are down around 20% compared to FY20’s levels.

CSL also opened 25 new facilities to attract lapsed and new donors through its doors. In FY22, the company plans to open another 40 centres, expanding its presence, mostly across the United States.

CSL CEO Paul Perreault commented:

Plasma collections are expected to continue improving following multiple initiatives we have implemented. Together with the global rollout of COVID-19 vaccines I’m optimistic of a global recovery with greater social mobility and more normalised conditions.

CSL share price summary

Over the course of the past 12 months, CSL shares have taken investors on a rollercoaster ride, but are up 8%. It appears investors believe the worst is over for the company, with vaccination rates climbing and countries eyeing a post-COVID-19 world.

In early trade today, the CSL share price is up 0.53% to $311.94.

On valuation grounds, CSL is the second-largest company on the ASX with a market capitalisation of roughly $141.22 billion.

The post The CSL (ASX:CSL) share price is up 6% since earnings result appeared first on The Motley Fool Australia.

More reading

• Top broker names 3 ASX 200 shares to buy
• ASX 200 Weekly Wrap: A mixed bag of earnings dominates ASX
• 2 ASX 200 shares that are rated as buys
• August has been a great month so far for the CSL (ASX:CSL) share price
• What’s moving the ASX 200 Index (ASX:XJO) on Monday?

Motley Fool contributor Aaron Teboneras owns shares of CSL Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of 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 Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3sY1vlz

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

Shares of electric car superstar Tesla (NASDAQ: TSLA) accelerated 2.5% as of 12:10 p.m. EDT Monday, continuing a winning spurt that began late last week.

As CNBC reported, on Thursday Tesla’s Tesla Energy Ventures subsidiary applied to the Texas Public Utility Commission to “sell electricity directly to customers in Texas.”  

So what

As you’ve probably heard, Tesla has been building a global business in the new field of battery warehouses, setting up electricity storage facilities in Australia, Belgium, and California. In Texas, it’s building two more battery facilities — one near Houston and another near Austin — totaling hundreds of megawatts of capacity.  

This seems somewhat different from that.

Rather than just storing electricity produced by other companies, and feeding it back into the grid as needed to prevent blackouts and brownouts, Tesla’s new license would authorize it to produce and sell electricity directly to consumers, utilizing a sales force shared with the Tesla division that sells home solar roofs.

Now what

It’s not 100% clear how Tesla intends to produce the electricity that it wants to sell — whether through solar panels (the logical conclusion), or windmills (very popular in Texas), or cogeneration of electricity at its Austin gigafactory.

For that matter, Tesla might only be planning to buy electricity when it’s cheap, store it in its battery warehouse, and then resell the power whenever it’s dear. We simply don’t know. (TexasMonthly, which first reported on Tesla’s application, laments simply that “details … are scant.”)

What is clear is that Tesla is growing and expanding into new markets once again. For investors today, that seems to be plenty to send Tesla shares higher.

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

The post Why Tesla put the pedal to the metal on Monday appeared first on The Motley Fool Australia.

More reading

• Is Tesla Bot a catalyst for Tesla stock?
• Why Tesla stock jumped on Monday
• 2 big revelations from Tesla’s AI Day event
• Up 50% in a month! Bitcoin is back over US$50,000
• Will the ASX 200 follow the S&P 500 to double its March 2020 lows?

Rich Smith has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Tesla. 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.

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

from The Motley Fool Australia https://ift.tt/2UYwNvQ

After a brief mid-August rally, the A2 Milk Company Ltd (ASX: A2M) share price tumbled 12% in the past week to a 2-month low of $5.82.

Why the A2 Milk share price continues to fall

Gloomy near-term outlook

A2 Milk released its FY21 results on Thursday, 26 August.

The result was in line with the company’s guidance it downgraded four times during FY21.

But at face value, the figures were far from inspiring. The company’s revenues declined 30.3% to NZ$1.2 billion, while net profit after tax (NPAT) took a 79.1% hit to NZ$80.7 million.

The company flagged that “China market growth has reduced significantly from globally high rates to be flat, and cross -border trade has been disrupted significantly which has had a profound impact on the Company’s results”.

A2 Milk’s near-term outlook wasn’t so bright either.

A2 Milk observed that the Chinese infant nutrition market was “materially impacted by a lower birth rate, especially recently due to COVID-19 and related vaccination programmes causing many people to delay pregnancy”.

As a result, the company expects the value of the overall infant nutrition market to decrease due to the lower number of births, an increase in competitive intensity and promotional activity impacting average pricing.

In addition, A2 Milk flagged that “market share gains by domestic brands compared to international brands are expected to continue”.

A2 Milk share price tumbles on high volume

The A2 Milk share price tumbled 11.8% to $6.05 on Thursday, 26 August following the release of its FY21 results. By market close, approximately 27 million shares had traded hands, more than double its current 10-day average volume of 9.5 million.

The selling pressure would carry over to the next day, with A2 Milk shares sliding another 2.64% to $5.89. Selling volumes remained elevated, with just over 15 million shares traded on Friday.

The post Here’s why the A2 Milk (ASX:A2M) share price is down 12% in a week appeared first on The Motley Fool Australia.

More reading

• ASX 200 Weekly Wrap: A mixed bag of earnings dominates ASX
• Top brokers name 3 ASX shares to sell next week
• Despite disappointing FY21 results, the A2 Milk (ASX:A2M) share price is still up in August. Here’s why
• Leading brokers give their verdict on the A2 Milk (ASX:A2M) share price
• The ASX reporting wrap-up: A2 Milk, Woolworths, Appen

Motley Fool contributor Kerry Sun 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 A2 Milk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3BneKz9

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?

The Facebook Inc (NASDAQ: FB) share price had risen a modest 2.3% at 3 p.m. EDT on Monday.

That may not sound like much, but on a $1.1 trillion dollar stock, it works out to $25 billion in extra market capitalisation. (For context: If Snap moved that much in a day, its stock would be up more than 17%!)

What sent the Facebook share price up so much?

This morning, Facebook announced it will begin asking Instagram users for their birthdays (Facebook owns Instagram). As the company went on to explain, Facebook needs “to know how old everybody is on Instagram” in order to “create new safety features for young people.”

Facebook said that knowing a user’s age will permit it to, for example:

• Prevent adults from messaging minors they don’t follow.
• Restrict advertising to users under age 18.
• Show ads that are more relevant to a user’s age.

Now what?

At least two of those announced purposes do seem aimed at safety for young people. The third might be more aimed at generating better ad sales for Facebook.

Be that as it may, whatever Facebook’s motivation, the company’s announcement clearly means more data for Facebook, and as an information company, that’s something that will probably make Facebook more valuable.

Speaking of which, Facebook clarifies that it will be requesting birthday information only from users who have not already provided it. Those users will be asked repeatedly to provide the information until they finally consent — or find themselves unable to use Instagram. However, Facebook also knows that “some people may give us the wrong birthday.” (Surprise!) But that gambit might not work as well as you think it does.

Going forward, Facebook will be using artificial intelligence to estimate how old people really are based on the content of their posts. And lest you think you can still outsmart Facebook: “If someone tells us they’re above a certain age, and our technology tells us otherwise, we’ll show them a menu of options to verify their age.”

In short: Big Brother isn’t just watching you. Now it’s counting the candles on your birthday cake, too.

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

The post Why the Facebook share price popped on Monday appeared first on The Motley Fool Australia.

More reading

• 4 reasons Facebook is a compelling buy
• Facebook (NASDAQ:FB) share price in focus as it reveals its answer to Zoom
• Why Facebook stock slipped on Tuesday
• Will Snap be worth more than Facebook by 2030?
• Amazon investors are getting its e-commerce business for free

Rich Smith has no position in any of the stocks mentioned. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Facebook. The Motley Fool Australia has recommended Facebook. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

from The Motley Fool Australia https://ift.tt/38t1fBE

The PointsBet Holdings Ltd (ASX: PBH) share price will be on watch today.

This follows the release of the sports betting company’s full year results.

PointsBet share price on watch after strong year but large loss

• Turnover up 228% to $3,781.4 million
• Revenue increased 159% to $194.7 million
• Normalised EBITDA loss of $156.1 million
• Normalised loss after tax of $164.3 million compared to $39.7 million loss in FY 2020
• Statutory loss after tax of $187.1 million
• Cash balance of $276.2 million (including $30.6 million of client cash)

What happened in FY 2021 for PointsBet?

For the 12 months ended 30 June, PointsBet reported a 228% increase in turnover to $3,781.4 million. This was driven by a 117% annual increase in Australian active clients to 196,585 and a 661% increase in US active clients to 159,321.

Also growing quickly was its gross and net win. PointsBet’s gross win increased 201% to $353.1 million, whereas its net win jumped 152% to $207 million. This ultimately led to the company reporting a 159% increase in revenue to $194.7 million for FY 2021.

However, due to big increases in its cost of sales and operating expenses, PointsBet reported a normalised loss after tax of $164.3 million. This sizeable loss could potentially weigh on the PointsBet share price today.

One of its largest expenses was marketing. The company spent $51.4 million on Australian marketing. This includes a refreshed brand campaign featuring NBA MVP Shaquille O’Neal. Over in the United States, its marketing spend came to $119.2 million. Management explained that this reflects an increase in the number of operating jurisdictions. Its US marketing expense is expected to continue to increase as its footprint expands.

What’s next for PointsBet in FY 2022?

No guidance was given for FY 2022, nor has a trading update being provided for the first two months of the financial year.

However, management appears confident in the future after a busy year. In fact, it feels that everything is now in place to attack the massive US market.

It commented: “PointsBet has put together all the pieces of the puzzle needed to take advantage of the significant North American opportunity – with a continued focus on first class execution and building upon the growth and success achieved to date.”

The PointsBet share price is down 11% in 2021.

The post PointsBet (ASX:PBH) share price on watch after stellar sales growth but $187m loss appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 midday update: Fortescue result and dividend impress, Altium sinks
• Pointsbet (ASX:PBH) share price slips following denied betting licence
• The Pointsbet (ASX:PBH) share price rocketed 115% last time the company reported
• 3 rapidly growing ASX tech shares to buy

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 shares of and has recommended Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/38pv4CX

The Shaver Shop Group Ltd (ASX: SSG) is under the spotlight as it unveiled a big increase in earnings but warned of softer sales.

The desperate rolling COVID-19 lockdowns are both a friend and foe for the personal grooming retailer.

The group posted a 68.3% surge in FY21 net profit to $17.5 million as sales improved 9.6% over the previous year to $213.7 million.

Shaver Shop profit and margin expands

What may be particularly pleasing was a large expansion in profit margins. Gross profit margin expanded 240 basis points, or 2.4 percentage points to 44.3%.

In a period when so many ASX companies are complaining about cost pressures, Shaver Shop is flexing its muscles.

One big contributor to the improved margins is cost control. Management shaved 110 basis points off operating expenses to 25.8% of sales in the period.

Shaving costs helped with strong result

“Shaver Shop worked proactively and collaboratively with landlords during lockdown periods,” said the company.

“In doing so, Shaver Shop received $0.8m in rent abatements in FY2021 for stores that were significantly impacted by government-imposed trading restrictions due to COVID-19.”B

Perhaps the comments were meant to contrast with the more confrontational approach some retailers, such as Premier Investments Limited (ASX: PMV), have taken with landlords.

Shaver Shop profit results boost dividends over 70%

The retailer also credited its astute management of store rosters during the long COVID lockdowns. This resulted in employment cost savings during the year.

Shaver Shop is using some of the stronger profit and margins to reward shareholders. It declared a fully franked final dividend of 5 cents a share, which takes total dividends for the year to 8.2 cents. That’s a 71% increase over FY20’s total dividends.

Has Shaver Shop’s sales peaked?

But management’s outlook could be the chink in the armour as it suggests its revenues may have peaked.

Shaver Shop reported that total sales since the start of this financial year is 7.3% below that of the same period in FY21.

The retailer blamed the long painful lockdowns in Victoria and New South Wales for the drop. Interestingly, Shaver Shop was seen as a COVID winner during the earlier COVID outbreak as more stuck-at-home consumers had to turn to DIY grooming.

Foolish takeaway

The latest round of lockdowns is driving a big surge in Shaver Shop’s online sales, but that’s not enough to offset the losses.

Website sales has jumped 52% since the start of FY22 over the same time last year and is up 368.1% versus FY20.

Given that the Shaver Shop share price is “only” up 13% over the past year, maybe investors will be happy to overlook the negatives.

The post Shaver Shop (ASX:SSG) share price in focus as profit jumps but outlook softens appeared first on The Motley Fool Australia.

More reading

• 2 top ASX dividend shares to think about
• Here are the top 10 ASX shares today
• Which ASX shares are the biggest movers on the ASX 300 today?
• Why AGL, PointsBet, Premier Investments, & Star shares are charging higher

from The Motley Fool Australia https://ift.tt/3zAMXe0