A number of ASX All Ords tech shares have released their latest results on Wednesday.

Three results that have dropped today are summarised below. Here’s how investors have responded to them:

Hansen Technologies Limited (ASX: HSN)

The Hansen share price is down 4%. This morning, this billing technology company reported a 0.1% increase in half-year operating revenue to $149.1 million and a 29.7% decline in underlying net profit after tax to $16.6 million. The latter reflects its focus on investing for growth by building back staffing capacity to pre-pandemic levels.

In light of this profit decline, the Hansen board elected to cut its dividend by 28.6% to 5 cents per share.

Readytech Holdings Ltd (ASX: RDY)

Another ASX All Ords tech share that is sliding 4% today is ReadyTech. This is despite the enterprise software provider releasing its half-year results and reporting a 34.1% increase in revenue to $47.9 million and underlying EBITDA of $15.6 million. The former reflects like-for-like growth of 13.4% and the acquisition of IT Vision.

Management also confirmed that it remains on target to achieve its FY 2023 guidance and reaffirmed its FY 2026 goal of over $160 million of organic revenue.

Siteminder Ltd (ASX: SDR)

The Siteminder share price has bounced back from an early decline and is now up 2%. This follows the release of the hotel technology company’s half-year results. Siteminder reported a 30.1% increase in annualised recurring revenue (ARR) and a net loss of $24.7 million.

Management notes that subscriber and subscription revenue growth accelerated during the half as the ramping of its go-to-market capacity post-COVID gained momentum. In addition, its transaction product growth has continued to be a highlight, which management believes reflects the significant opportunity within its customer base.

The post 3 ASX All Ords tech shares making moves on earnings updates appeared first on The Motley Fool Australia.

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More reading

• These ASX tech shares are buys with 30%+ upside: brokers
• Goldman Sachs says these excellent ASX tech shares are buys
• ASX share prices have rallied too hard to start 2023 says UBS equity strategist as one US analyst says don’t even think about turning bullish until 2024
• Goldman Sachs names 2 exciting small cap ASX tech shares to buy right now

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 Hansen Technologies, ReadyTech, and SiteMinder. The Motley Fool Australia has recommended ReadyTech. 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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Qantas Airways Ltd (ASX: QAN) shares are down 1.17% in late morning trade.

The S&P/ASX 200 Index (ASX: XJO) airline’s shares closed yesterday trading for $6.40 apiece. Shares are currently swapping hands for $6.325 each.

This comes amid wider selling action today following some steep losses on US markets overnight, which sees the ASX 200 currently down 0.76%.

That’s this morning’s price action for you.

Now, what’s this about Qantas’ $100 million investment?

How is the ASX 200 airline investing $100 million?

In a potentially promising sign for the outlook of Qantas shares, the company said it is investing $100 million to upgrade its global airport lounge network as travel demand recovers faster than expected.

The investment will fund four new lounges, including a new flagship First Lounge at London’s Heathrow Airport. Qantas will also upgrade many of its existing international and domestic lounges.

In Australia, that includes an updated and expanded International Business Lounge in Melbourne, a new Hobart Qantas Club, and a new Broome Regional Lounge with double the seats.

The airline said this is the biggest investment in its lounge network in more than 10 years. The $100 million expenditure will be phased over three years. Qantas reported this is already included in its existing capital expenditure forecast.

Commenting on the lounge upgrades, Qantas CEO Alan Joyce said:

Being back in profit means we’re back to making long term investments for our customers. That started with the major aircraft order we announced last year and now we’re building on that with a major investment in our lounges.

As for the London lounge plans, Joyce said, “London is one of the most important destinations on our network and it’s the perfect location for a First Lounge, especially with our direct Project Sunrise flights on the way.”

“Heathrow is one of the world’s busiest airports so we’re very pleased to be working with them to secure a great space in the terminal for an additional lounge,” he added.

If you own Qantas shares, be sure to tune in tomorrow when the company reports its half-year earnings results.

How have Qantas shares been performing?

As you can see in the chart below, Qantas shares have been trending solidly higher since mid-July. Over the past 12 months, shares in the ASX 200 airline are up 22%.

The post Own Qantas shares? Here’s how the ASX 200 airline is investing $100 million appeared first on The Motley Fool Australia.

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More reading

• Is Coles now one of the best ASX 200 dividend shares?
• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• 3 ASX 200 stocks falling hard on results announcements

Motley Fool contributor Bernd Struben 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 EML Payments Ltd (ASX: EML) share price took a severe tumble in early trading after the company released its 1H FY23 results.

The EML share price opened at 56 cents, down 12.5% on yesterday’s close. It quickly declined to an intraday low of 52.5 cents shortly after the market open.

However, the ASX tech share rebounded quickly and is now trading at 60.2 cents, down 6% for the day.

While the headline news is bad, revenue and gross profit are both up. The company’s net profit decline is largely due to investment in its transformation strategy and non-cash impairments.

Let’s take a look.

EML share price dives after 95% profit decimation

The key points for the six months ending 31 December 2022 are:

• Group revenue of $116.6 million, up 2% on the prior corresponding period (pcp) of 1H FY22
• Underlying gross profit was up 5% pcp but group underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $13.4 million was down 50% pcp
• Group underlying net profit after tax, adjusted to exclude the non-cash tax-effected amortisation of intangibles and significant non-operating items (NPATA) of $700,000 is down 95% pcp
• Group net loss of $129.9 million, largely reflecting non-cash impairments
• Cash balance up 7% to $79.2 million pcp
• Underlying operating cash flow conversion of 102%

Management said revenue was up largely due to a significant increase in interest income at $7.1 million.

Benefits stemming from the Sentenial acquisition were behind a 55% boost to gross debit volumes at $49.4 billion. The 5% increase in gross profit was driven by increased high-margin revenues from Sentenial, plus interest.

The halving of group EBITDA was largely reflective of further investment in the European businesses.

What did management say?

EML group CEO Emma Shand said:

Underlying financial performance for the half was in line with expectations reflecting the heavy set of challenges that the company has faced over the past two years and reinforcing the importance of our transformation strategy.

During the half, we have focused on getting the foundations right and have made solid progress on our remediation program, Elevate, which we have committed to completing by the end of December 2023, as previously announced.

What’s next?

EML is continuing with the execution of its transformation strategy.

EML announced its transformation plan at its annual general meeting in November 2022. Investors responded favourably to the plan at the time, with the EML share price leaping 12% on the day.

The plan is to make EML a leading payments provider in four key segments over the next five years: human capital management, financial services, retail and gifting, and government.

The company said progress over the half included further work on its remediation programs in Ireland and the United Kingdom, which are expected to be completed by the end of December.

EML launched a new data platform in January to support Elevate and move toward a single source of data. It also introduced a new product suite campaign in the human capital management segment.

Shand said:

We have a strong balance sheet and a clear transformation path ahead of us and are well positioned to execute EML’s next chapter and deliver on our commitment to be an embedded finance leader of the future.”

The company reaffirmed its guidance for underlying full-year EBITDA of between $26 million and $34 million but altered guidance on revenue and costs.

Revenue expectations are now between $235 million and $245 million based on the first-half results and an expected upswing in interest.

Underlying costs are expected to be lower and in the range of $133 million and $140 million.

EML share price snapshot

The ASX tech share is down 0.8% in the year to date compared to a 4.8% bump for the S&P/ASX All Ordinaries Index (ASX: XAO).

Over the past 12 months, EML shares have fallen 75% compared to a rise of 0.7% for the All Ords index.

The post EML share price crashes 18% on half-year results but quickly rebounds appeared first on The Motley Fool Australia.

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More reading

• 3 ASX All Ords tech shares making moves on earnings updates
• Own Qantas shares? Here’s how the ASX 200 airline is investing $100 million
• Here’s the latest ‘bearish news’ from brokers on ASX 200 lithium stocks
• Hoping to hop on the huge Whitehaven dividend? You’d better hurry
• Woolworths share price higher on strong result and ‘better than expected’ second-half start

Motley Fool contributor Bronwyn Allen 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 EML Payments. The Motley Fool Australia has positions in and has recommended EML Payments. 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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There is no question ASX 200 lithium stocks have been the gift that just keeps on giving over the past few years. However, the consistent ‘up and to the right’ trajectory of these investments could now be in jeopardy according to some analysts.

The doubt surrounding producers of the critical electrifying material began to creep in towards the end of January. Since then, many of the most popular lithium shares on the ASX have experienced dwindling share prices.

Yesterday, analysts added to the waning optimism amid ‘negative’ industry developments.

Is the demand landscape shifting?

Evergrowing demand for electric vehicles (EVs) — and the batteries they require — has been an integral component of sustained lithium demand at elevated prices. If this is to be believed, it must also apply if the reverse is true — declining battery demand.

For the last two years, such a scenario would almost be considered unfathomable. Today, though, the environment is certainly different.

The unwavering determination of central banks to crush inflation has upsized the possibility of a recession. Even one of Australia’s major banks, National Australia Bank Ltd (ASX: NAB), is forecasting Australia’s economy to fly daringly close to the sun over the coming quarters.

Hence, the possibility of falling demand for EVs wouldn’t be completely unfounded.

This year so far has witnessed lithium carbonate prices tumble around 30%. As pictured above, this has occurred hand in hand with falling growth in China’s EV sales. Now analysts are concerned about the reduced demand flowing upstream.

Yesterday, Morgan Stanley highlighted a move from CATL — one of the world’s largest EV battery manufacturers — to sell some of its batteries at a significant discount to spot prices.

In our view, this may be reflective of CATL’s concern on the overcapacity issue and slowing EV demand, and its expectation that lithium prices will further normalise in coming years. We think discounting is expected to impact pricing expectations negatively.

Rachel Zhang, Morgan Stanley equity analyst

Analysts are also worried about the supply side of the equation, dousing added fuel on the fire for ASX lithium stocks. Ark Invest’s Cathie Wood believes skyrocketing lithium prices will have incentivised additional supply which is expected to come online over the coming years, as shown below.

Are ASX 200 lithium shares still outperforming this year?

The cratering lithium price has not prevented some ASX lithium shares from continuing their upward trend this year. While the S&P/ASX 200 Index (ASX: XJO) is up a solid 4.7% year-to-date, the following lithium companies are outpacing it:

• Allkem Ltd (ASX: AKE) up 5.3%
• Mineral Resources Ltd (ASX: MIN) up 13.1%
• Pilbara Minerals Ltd (ASX: PLS) up 21.3%

Morgan Stanley currently holds an equal weight rating on Mineral Resources. Whereas Allkem and IGO Ltd (ASX: IGO) are two ASX 200 lithium stocks that the broker is underweight on.

The post Here’s the latest ‘bearish news’ from brokers on ASX 200 lithium stocks appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX 200 shares today
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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 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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Investors interested in getting hold of the big dividend that’s about to be paid by Whitehaven Coal Ltd (ASX: WHC) shares need to be quick.

The ASX coal share last week reported a very strong first half of FY23.

Revenue jumped 164% to $3.8 billion, earnings before interest, tax, depreciation and amortisation (EBITDA) went up by 319% to $2.65 billion, operating cash flow improved 348% to $2.54 billion, and net profit after tax (NPAT) grew 423% to $1.78 billion.

Whitehaven’s board decided to declare a dividend of 32 cents per share. This was a huge 300% increase from the prior corresponding payment of 8 cents per share.

But, despite only being declared last week, investors are nearly out of time to grab the dividend.

Whitehaven dividend deadline

When Whitehaven announced the details of the dividend, it revealed that the ex-dividend date is 23 February 2023.

That means that today is the last day for investors to be able to gain entitlement to that dividend. If investors wait until tomorrow to invest, they will miss out on it.

For investors who do buy/own shares of Whitehaven, the ASX coal share will pay the dividend on 10 March 2023.

But the dividend isn’t the only way that Whitehaven is sending capital back to shareholders.

During the half year, 67 million shares – being 7% of the shares on issue – were bought back for an investment of $592.8 million, 40.1 million shares and $367.4 million in relation to the stage two FY23 share buyback approved by shareholders in October 2022.

Total capital returned through the second stage of the buyback for the half year and the interim dividend is $641.4 million, representing a total dividend payout ratio of 36% of FY23 first-half net profit after tax.

Yield on offer

At the current Whitehaven share price, the upcoming dividend represents a cash yield of 4.25%,

The grossed-up dividend yield is 6.1%.

Remember, this yield is after a 140% rise in the Whitehaven share price over the past year (which reduces the dividend yield). Plus, it is keeping almost two-thirds of its net profit within the business, rather than paying it out.

The post Hoping to hop on the huge Whitehaven dividend? You’d better hurry appeared first on The Motley Fool Australia.

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• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Why AMP, Evolution, Perenti, and Whitehaven Coal shares are dropping
• Everything you need to know about the monster Whitehaven dividend

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 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 Woolworths Group Ltd (ASX: WOW) share price is defying the market weakness on Wednesday and is pushing higher.

In morning trade, the retail giant’s shares are up almost 3% to $37.72.

Why is the Woolworths share price pushing higher?

Investors have been bidding the Woolworths share price higher this morning after the company’s half-year results came in ahead of expectations.

For the six months ended 31 December, Woolworths reported a 4% increase in sales to $33,169 million and an 18.4% lift in earnings before interest and tax (EBIT) to $1,637 million.

This was underpinned by sales growth across the Australian Food, Big W, Metro Food, and Australian B2B segments, as well as the non-recurrence of direct COVID costs totalling $239 million.

This ultimately allowed Woolworths to lift its interim dividend by 17.9% to a fully franked 46 cents per share.

Also potentially boosting the Woolworths share price has been its strong start to the second half. For the first seven weeks of the half, Australian Food sales are up 6.5%, New Zealand Food sales are up 6.3%, and Big W sales are up 9.7%.

Broker reaction

Goldman Sachs, which had tipped Woolworths to positively surprise with its earnings, commented:

WOW reported 1H23 results with group sales A$33.2B +4.0% in-line with GSe and Group EBIT of A$1.64B +18.5% YoY and +7% vs GSe. Income tax expense was slightly higher than anticipated leading to Group Underlying NPAT of A$907mn, +14% YoY and +2% vs GSe.

All in all, the broker was pleased with the result and remains positive on the future. Though, it is keen to see how the company responds to rival Coles Group Ltd (ASX: COL) stepping up its competition. It said:

The margin outcome for Australia Supermarket and the better than expected run-rate in 2H23 first 7 weeks is the bright spot though we will need to understand the execution strategy to maintain/continue to gain market share in the face of COL stepping up competition more aggressively with greater focus on value and also supply chain upgrades to come. GPM expansion opportunity into 2H23 (which is largely unimpacted by COVID cost reduction) would also be key to understand flow-through to EBIT margin sustainability as COVID cost savings reduce as a positive catalyst in 2H23 and FY24.

The broker concludes by reiterated its buy rating (and $41.20 price target). It said:

Overall we continue to believe that the more advantaged omni-channel execution capability of WOW will continue to drive longer term market share gains and cost efficiencies for EBIT margin expansion. Reiterate Buy.

The post Woolworths share price higher on strong result and ‘better than expected’ second-half start appeared first on The Motley Fool Australia.

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More reading

• Woolworths share price on watch amid first-half earnings beat
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• Own Woolworths shares? Here’s what the market is expecting from its half year results
• Buy Woolworths shares today for 15% upside plus passive income: Goldman
• These ASX 200 shares are buys: experts

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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The Origin Energy Ltd (ASX: ORG) share price is soaring this morning despite news the consortium looking to acquire the energy provider has lowered its offer price.

After an extended due diligence period, the consortium comprising Brookfield Asset Management and MidOcean has dropped its bid to $8.90 per share. That’s 1.11% lower than its previous $9 per share offer.

After open this morning, the Origin share price shot to a high of $8.02, a jump of 14% on yesterday’s close. Right now, the Origin share price is $7.91, 12.84% higher than its previous close.

Let’s take a closer look at the latest news from the S&P/ASX 200 Index (ASX: XJO) energy company.

Origin share price rockets as takeover bid dropped to $8.90

The Origin share price is taking off this morning as the company backs a newly-reduced takeover bid.

It follows a drawn-out due diligence period. Thus, the market may be relieved to learn the suitors are still interested after flicking through the takeover target’s books. Though, the Origin share price remains notably lower than the offer price, perhaps suggesting investors remain wary of the deal.

Origin’s board still thinks the lower bid “has the potential to deliver significant value to shareholders”. Thus, it’s vowed to continue discussions with the consortium.

The now-$8.90 per share offer will stand for the first 100,000 stocks held by an investor. After that, shareholders will receive $4.334 and US$3.194 per share – equivalent to $8.90 at an exchange rate of 70 US cents for every Aussie dollar.

That will be reduced by any dividends paid by Origin between now and the takeover’s completion. Of course, that includes the 16.5 cents per share fully franked dividend the ASX 200 constituent revealed last week.

The US dollar consideration reflects the underlying exposure of Origin’s integrated gas assets. Specifically, cash distributions from the 27.5% interest in Australia Pacific LNG.

The offer is conditional upon a number of matters including regulatory approval and black box due diligence.

Brookfield and MidOcean first put forward their $9 per share bid in November. At the time, it represented a near-55% premium to the Origin share price and valued the company at more than $18 billion.

Back then, Origin said it had rejected an offer of between $8.70 per share and $8.90 per share from the consortium in September.

The post Origin share price surges 14% despite lower takeover bid appeared first on The Motley Fool Australia.

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• Origin Energy share price drops on underlying profit tumbling 83%
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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 positions in and has recommended Brookfield Asset Management. 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 is marching higher in early trade, up 1.6%.

The S&P/ASX 200 Index (ASX: XJO) energy stock closed yesterday trading for $6.81. Shares are currently changing hands for $6.92.

This comes following the release of Santos’ full-year 2022 financial results.

Here are the highlights.

(*Note all figures are in US dollars.)

Santos share price gains amid surging profits

• Record production of 103.2 million barrels of oil equivalent (mmboe), up 12% from 2021
• Record revenue from ordinary activities of $7.8 billion, up 65% year on year
• Net profit increased 221% from 2021 to $2.1 billion
• Earnings before interest, taxes, depreciation, amortisation, and exploration expense (EBITDAX) of $5.6 billion, up 101% from 2021
• Final unfranked dividend of 15.1 US cents per share, up 78%

What else happened during the year?

Other metrics of interest that could be lifting the Santos share price today include the 160% year on year increase in underlying profit, which came in at $2.5 billion.

(Santos notes that this measure excludes the impacts of asset acquisitions, disposals and impairments, as well as items that are subject to significant variability from one period to the next, including the effects of commodity hedging.)

Santos also reported ending the year with a record reserve and resource position of 5 billion boe, with 165 mmboe 2P reserves added in Alaska following the sanction of Pikka Phase 1.

2022 also saw Santos successfully implement its merger with Oil Search, which it said included the realisation of $122 million of annual synergies.

The Barossa gas project faced some delays but is now 55% complete.

And with free cash flow from operations leaping 142% year on year to $3.6 billion, Santos strengthened its balance sheet with $5.6 billion of liquidity at 31 December. Net debt came down by $1.7 billion to end the year at $3.5 billion.

What did management say?

Commenting on the results that look to be boosting the Santos share price today, CEO Kevin Gallagher said:

We have commenced 2023 with a high level of confidence that Santos will execute its strategic plan and deliver sustainable returns to shareholders as a result. Demand for our products is likely to continue to be strong in 2023 and beyond.

What’s next?

Looking ahead to what could impact the Santos share price over the coming months, the company offered 2023 production guidance of 89 to 96 mmboe with sales volumes of 90 to 100 mmboe.

Capital expenditure for major projects, including Santos Energy Solutions is forecast to come in at around $1.8 billion. And upstream production costs for 2023 are expected to fall in the range of $7.25 to $7.75/boe.

Santos share price snapshot

As you can see in the chart below, the Santos share price – which doesn’t include the dividend payouts – is down just over 2% since this time last year. Longer-term, shares are up 35% over five years.

The post Santos share price marches higher on surging dividend payout appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Monday
• Santos share price edges lower amid allegations of disastrous deception

Motley Fool contributor Bernd Struben 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 Domino’s Pizza Enterprises Ltd (ASX: DMP) share price is sinking on Wednesday.

At the time of writing, this pizza chain operator’s shares are down 23% to $54.80.

This follows the release of the company’s half-year results this morning.

Domino’s share price sinks as inflation bites

• Global sales up 1.2% to $1.97 billion
• Online sales down 4.5% to $1.53 billion
• Earnings before interest and tax (EBIT) down 21.3% to $113.9 million
• Underlying net profit after tax down 21.5% to $71.7 million.
• Partially franked interim dividend down 23.8% to 67.4 cents per share

What happened during the half?

For the six months ended 31 December, Domino’s reported a 1.2% increase in sales to $1.97 billion. This was driven by the addition of 357 new stores, which offset a 4.5% decline in online sales. The latter reflects lower aggregator sales and a shift from delivery to carry-out.

Things were much worse for the company’s EBIT, which tumbled 21.3% during the half. That’s despite ANZ EBIT rising 5.2% to $63.4 million on marginally lower sales of $687.3 million.

The main drag on its performance was its European operations, which have been more affected by inflation. This is largely due to higher levels of inflation affecting larger markets including Germany and France.

Management notes that passing through input costs in Europe has seen a decline in customer counts across multiple markets, particularly in delivery. Nevertheless, delivery orders remain elevated versus pre-COVID levels, and management is working to rebalance the value equation for customers and franchisees.

This earnings decline ultimately led to the Domino’s board slashing its dividend by 23.8% to 67.4 cents per share.

Management commentary

Domino’s CEO and Managing Director, Don Meij, acknowledged that the company’s management of inflation has been disappointing. He said:

Given the challenging conditions and the effect on our franchisees we felt it was necessary to lift prices, including applying some surcharges. This was successful in protecting franchisee profitability, however given the speed of the change it was difficult to forecast the effect on customer repurchasing rates, especially where customers order less frequently such as Japan or Germany.

It meant while we saw an initial benefit to franchisees’ unit economics, specific customer groupings, particularly in delivery, reduced their ordering frequency which resulted in December trading being significantly below our expectations.

Fortunately, the customer demand globally for freshly prepared, affordable out-of-home meals, remains strong. This gives us confidence that the power to overcome these short-term challenges is within our control and we will continue to work to get the balance right.

Outlook

While a poor first-half result was expected by the market, the softer than expected start to the second half appears to have spooked investors and put pressure on the Domino’s share price today.

Management revealed that sales growth in the second half has been less than anticipated with same store sales down 2.2% and total sales up 4.2%. In light of this, management believes that its full-year same store sales growth will be below its medium term target of 3% to 6% in FY 2023.

Making things worse, the company warned that its new store openings may also be below its medium term target of 8% to 10%. This will depend on franchisee sentiment in the current environment.

Nevertheless, management is confident in the ability to return to positive same store sales growth once it is able to balance the value equation for customers.

It notes that the “newest product, pricing and voucher initiatives we are testing and implementing are showing promise, but it is too early for us to be definitive on the outlook for their performance.”

The post Domino’s share price crashes 23% following disappointing first-half result appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Domino’s Pizza Enterprises. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Domino’s Pizza Enterprises. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. 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 WiseTech Global Ltd (ASX: WTC) share price is trading lower on Wednesday.

In morning trade, the logistic solutions company’s shares are down 2.5% to $54.29.

This follows the release of the company’s half-year results.

WiseTech share price drops on half-year results

• Revenue up 35% to $378.2 million
• Earnings before interest, tax, depreciation and amortisation (EBITDA) up 36% to $187.3 million
• Underlying net profit after tax up 40% to $108.5 million
• Free cash flow up 53% to $137.8 million
• Interim dividend increased 39% to 6.6 cents per share

What happened during the half?

For the six months ended 31 December, WiseTech reported a 35% jump in revenue to $378.2 million. This was underpinned by a 50% increase in CargoWise revenue to $289.2 million, which was driven by growth from existing and new customers.

This means that recurring revenue now makes up 96% of the company’s revenue, which is up 3 percentage points since this time last year.

Thanks to enhanced operating leverage, pricing, new product releases, and ongoing financial discipline, WiseTech overcame inflationary pressures to deliver modest margin expansion during the half.

This ultimately led to its underlying net profit after tax increasing by 40% to $108.5 million.

Management commentary

WiseTech Founder and CEO, Richard White, was pleased with the company’s strong first half. He said:

Our strong first half performance highlights the continued resilience of our business model and progress of our 3P strategy. Our ability to deliver strong growth in revenue, earnings and free cash flow, in a softening global macroeconomic climate, is the result of a tremendous effort by our teams around the world and we’re immensely proud of the progress we are making towards our vision of being the operating system for global logistics.

We continue to see strong demand for our products from the world’s largest freight forwarders, having secured four new global rollouts and three organic global rollouts since July last year. CargoWise is rapidly becoming the industry standard. Importantly, in January this year, we also secured our first global customs rollout with Kuehne+Nagel, the world’s largest global freight forwarder. This is a testament to the success of our foothold acquisition strategy and our customs product development, as we build out a global customs engine.

Outlook

WiseTech has updated its FY 2023 guidance and now expects stronger revenue growth but slightly softer EBITDA growth. The latter could be weighing on the WiseTech share price today. Its guidance is now:

• Revenue of $790 million to $822 million (growth of 26% to 30%)
• EBITDA excluding M&A costs of $380 million to $412 million (growth of 19% to 29%).

This compares to previous guidance of 20% to 23% revenue growth and 21% to 30% EBITDA growth.

Mr White concluded:

WiseTech is a business that continues to grow and create value. Our unique CargoWise offering, which we expand and enhance through our own product development and our acquisition program, is enabling us to drive considerable momentum. This is underpinned by our global rollouts, stemming from an investment of over $775 million in research and development over the last five years.

We have a strong track record of delivering on our strategy, demonstrating the strength and resilience of our business model. Our strong balance sheet and cash generation provide us with significant financial firepower to fund our future growth. I am excited by the opportunities ahead of us and the future growth team WiseTech will deliver.

The post WiseTech share price drops despite strong earnings growth 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 positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. 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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