It’s looking like another positive day for the S&P/ASX 200 Index (ASX: XJO) at this stage of Thursday’s session. At the time of writing, the ASX 200 had added an encouraging 0.81% and is back above 7,050 points.

But let’s talk about the Qantas Airways Limited (ASX: QAN) share price. And, of course, the Qantas dividend.

Qantas shares are soaring today. The airline is currently up a very pleasing 7.93% at $4.90 a share. This lift comes directly after the carrier reported its earnings for the 2022 financial year.

As my Fool colleague Tony dug into this morning, Qantas reported a 53.5% surge in revenue to $9.1 billion. But that wasn’t enough to stop Qantas from posting a statutory loss after tax of $860 million, down 49.2% from last year. Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) were also down 31.5% to $281 million.

But what about Qantas’ dividend?

Qantas used to be a fairly solid ASX dividend-paying share. But the airline operator hasn’t paid a dividend in the post-pandemic era. Its last dividend was doled out way back in September 2019.

Where is the Qantas dividend at?

Unfortunately for income investors, the airline’s dividend situation won’t be changing this year. Qantas declared no final dividend for FY2022 this morning. It is difficult for a company to justify a dividend when it is losing money on the bottom line, after all.

But that’s not to say Qantas investors won’t be enjoying any form of capital return going forward. Because, although Qantas’ dividend drought continues, the airline did announce an on-market share buyback program, worth up to $400 million.

Share buybacks do not put cash in the hands of investors as a dividend does. However, they do support shareholders by reducing the overall share count. This tends to boost the share price, given that under the laws of supply and demand, less supply leads to a rise in price.

There are also fewer shares to split the company’s earnings between, leading to a potential boost in earnings per share (EPS) for existing investors.

So it’s not like there is nothing in this earnings report for investors to get excited about. This $400 million share buyback program might well be why the Qantas share price is soaring so high this Thursday.

At the current Qantas share price, this ASX 200 airline operator has a market capitalisation of $8.56 billion (but sadly still no dividend yield).

The post What’s going on with the Qantas dividend in 2022? appeared first on The Motley Fool Australia.

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More reading

• Flight Centre shares fall back to earth after $378 million loss
• Guess which ASX 200 share just upped its dividend by 108%
• The Qantas share price just flew 8% higher on $400 million share buyback
• Perpetual share price tumbles on full-year earnings and takeover news
• South32 share price gains ground on record FY22 earnings and special dividend

Motley Fool contributor Sebastian Bowen 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 down 3.5% today.

Woolworths shares closed yesterday trading for $37.40 and are currently trading for $36.11.

Investors are pushing down the Woolworths share price following the release of the retail giant’s full-year results for the 12 months ending 30 June.

Here’s why.

What are ASX 200 investors considering?

The FY22 results certainly weren’t bad.

Group sales came in at $60.85 billion, an increase of 9.2% from the prior year, while net profit after tax (NPAT) edged up 0.7% from FY21 to $1.51 billion.

Earnings before interest and tax (EBIT) went the other direction, slipping 2.7% from the prior year to $2.69 billion.

Commenting on the FY22 results, Woolworths CEO Brad Banducci said, “The extremely challenging operating environment caused by supply chain disruptions, product shortages, team absenteeism and flooding led to an inconsistent customer experience and a financial performance that was below our aspirations for the year.”

So, what about the year ahead?

It looks like the Woolworths share price isn’t coming under pressure from those results so much as from the outlook for FY23.

“We expect the trading environment to remain volatile and challenging due to endemic COVID disruptions, ongoing supply chain challenges, higher costs across our business and cost-of-living pressures for our customers,” Banducci said with an eye on the year ahead.

Woolworths expects food inflation to persist into FY23, which could continue to throw up headwinds for the share price.

Initial results from the new financial year show a 0.5% drop in total sales for the Australian food business for the first eight weeks of FY23, while total sales in the New Zealand food division over the eight weeks are down 1% year on year.

Woolworths share price snapshot

The Woolworths share price is down 6% in 2022. That compares to a year-to-date loss of 7% posted by the S&P/ASX 200 Index (ASX: XJO).

The post Woolworths share price wilts today amid ‘volatile and challenging’ outlook appeared first on The Motley Fool Australia.

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More reading

• Woolworths share price on watch as sales leap 9% to $61 billion
• 5 things to watch on the ASX 200 on Thursday
• Earnings preview: Here are the ASX shares reporting today
• Looking to buy Woolworths shares? Here’s what to watch in this week’s earnings results
• Earnings preview: Here are 3 ASX 200 shares reporting this week

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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Owners of AGL Energy Limited (ASX: AGL) shares could be in for a good 12 months with the S&P/ASX 200 Index (ASX: XJO) giant tipped to grow in its value and offerings.

Indeed, broker Morgans has high hopes for the company despite it posting apparently disappointing full-year earnings last week.

The AGL share price is currently trading at $7.98, flat with its previous close. For context, the ASX 200 is lifting 0.8% at the time of writing.

So, what might be in store for those invested in the company’s stock in the financial year 2023 (FY23)?

Let’s take a look.

AGL share price and dividends tipped to grow

AGL shares could be gearing up to grow in FY23, alongside the company’s earnings and dividends.

While the market doesn’t have any FY23 guidance from the ASX 200 energy producer and retailer, the company has noted it expects its earnings to be resilient this fiscal year amid challenging industry and market conditions.

It’s set to release more detailed guidance alongside the initial outcome of a review of its strategic direction next month.

While Morgans originally held higher expectations for the company in FY23, it’s still holding out hope for a win.

Analyst Max Vickerson conceded the broker is still bullish on the stock, slapping an add rating on valuation upside, despite commenting:

We significantly lower our expectations for FY23 underlying profit (-37%) given the likelihood of another year of wholesale electricity performance. We had hoped for a higher degree of optionality in its electricity derivatives and faster roll over of older hedging and customer pricing. Given the language used to couch the outlook we suspect this is not the case.

Additionally, as my Fool colleague James reports, Morgans has an $8.73 price target on AGL shares, suggesting a potential 9.4% upside.

It’s also tipping the company to pay out 30 cents of fully franked dividends in FY23. That represents a potential 15% increase from its full-year payout of 26 cents in FY22.

The post Could AGL shares really offer 9% upside and rising dividends in FY23? appeared first on The Motley Fool Australia.

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More reading

• Broker tips AGL share price to leap higher
• Is the AGL share price in the buy zone following the company’s latest results?
• Why AGL, Fisher & Paykel, Inghams, and TPG shares are sinking today
• Everything you need to know about the latest AGL dividend
• AGL share price dips after 58% profit slash

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

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The S&P/ASX 200 Index (ASX: XJO) is off to a flying start this Thursday. At the time of writing, the ASX 200 has gained a healthy 0.82% at just over 7,050 points. But let’s check out the performance of Flight Centre Travel Group Ltd (ASX: FLT) shares.

The Flight Centre share price is on watch today after the ASX travel share reported its full-year earnings for the 2022 financial year before the bell this morning.

As my Fool colleague Brooke dug into earlier, Flight Centre reported a massive 154% surge in revenues to $1 billion. But that was not enough to stop it from delivering an earnings before interest, tax, depreciation, and amortisation (EBITDA) loss of $200 million. That was a loss 53.7% higher than what the company delivered last year.

However, statutory loss before tax improved by 27% on FY21 to a loss of $377.8 million. But perhaps given that Flight Centre’s bottom line is still deep in the red, the company won’t be paying out a final dividend for FY22.

This stretches Flight Centre’s dividend drought to almost three years, given its last dividends were doled out back in October 2019.

So what does this mean for the Flight Centre share price? Let’s take a look.

How have Flight Centre shares reacted to the earnings result?

Well, it hasn’t been pretty. The travel company initially rose after market open this morning, climbing as high as $17.75 a share after opening at $17.45. But investors seem to have lost confidence, with Flight Centre shares now down 5.31% at $16.42 a share.

This latest move puts the Flight Centre share price at a loss of 11% year to date. However, the shares are up by around 1% over the past 12 months. Flight Centre remains down more than 50% from pre-COVID levels.

At the current Flight Cente share price, this ASX 200 travel share has a market capitalisation of $3.4 billion.

The post Flight Centre shares fall back to earth after $378 million loss appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX 200 share just upped its dividend by 108%
• Perpetual share price tumbles on full-year earnings and takeover news
• South32 share price gains ground on record FY22 earnings and special dividend
• Flight Centre share price in focus as full-year revenue surpasses $1 billion
• These ASX 200 shares will trade ex-dividend tomorrow

Motley Fool contributor Sebastian Bowen 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 Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Those invested in S&P/ASX 200 Index (ASX: XJO) mining share Iluka Resources Limited (ASX: ILU) were likely overjoyed by the company’s latest half-year earnings.

Its results were released to the market yesterday and contained a welcome surprise for investors – a whopping 25-cent interim dividend.

Not only is that the ASX 200 company’s largest payout in four years, but it’s also more than double what it offered to its shares investors in February.

The Iluka Resources share price launched 10% on the back of the news. It closed Wednesday’s session at $10.38, its highest point in 11 weeks. And it’s back on the horse today. It’s trading 2.4% higher at $10.63 right now.

For comparison, the ASX 200 finished yesterday in the green, having lifted 0.5%. It’s up another 0.81% at the time of writing.

Let’s take a closer look at the latest dividend offered by the ASX 200 mineral sands giant.

ASX 200 share Iluka Resources doubles interim dividend

Owners of Iluka Resources shares, rejoice! You’ve got a whopping 25-cent interim dividend coming your way. And a fully franked one at that.

That’s equal to the second largest dividend ever paid by the company, handed out in 2018, and only bested by a 55-cent payout offered in 2012.

Iluka Resources posted a $388.5 million profit for the first half yesterday. That represented a 185.7% increase on the prior corresponding period, as my Fool colleague Monica reported.

Its underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) also lifted 70.5% to $525.5 million. Finally, its free cash flow came in at $600.3 million.

Its latest offering included, the stock is trading with an approximate 3.45% dividend yield.

The company also offers a dividend reinvestment plan (DRP) for those more interested in growing their investment than cash payouts.

The ASX 200 share will trade ex-dividend on 5 September. That will likely see its share price fall in line with its interim payout. The 25-cent dividend will start to hit investors’ accounts on 30 September.

The post Guess which ASX 200 share just upped its dividend by 108% appeared first on The Motley Fool Australia.

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More reading

• Flight Centre shares fall back to earth after $378 million loss
• Perpetual share price tumbles on full-year earnings and takeover news
• South32 share price gains ground on record FY22 earnings and special dividend
• These ASX 200 shares will trade ex-dividend tomorrow
• 5 things to watch on the ASX 200 on Thursday

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

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The Qube Holdings Ltd (ASX: QUB) share price is gathering steam on Thursday after the logistics company handed in its full-year FY22 results.

The Qube share price opened 4.1% higher this morning and has continued to gain ground, up 6.1% at the time of writing.

Qube share price lifts as profit soars 

Here are the key takeaways from Qube’s report for the 12 months ended 30 June:

• Underlying revenue came in at $2.6 billion – up 27% compared to the prior corresponding period (pcp) of FY21
• Underlying earnings before interest, tax, and amortisation (EBITA) leapt 21% on the pcp to $221.1 million
• Underlying net profit after tax (NPAT) jumped 30% on the pcp to $185.7 million
• A fully franked final ordinary dividend of 3.3 cents was declared
• The board also declared a fully franked special dividend of 0.7 cents 

Qube reported underlying results to more accurately reflect the continuing operations of the business.

During the year, the company discontinued its property division and finalised the sale of its interests in the Moorebank Logistics Park (MLP).

Qube’s special dividend was fuelled by this $1.7 billion sale, along with the company’s positive earnings outlook.

The dividends declared today take the full-year total to a record 7 cents per share, fully franked. This puts Qube shares on a trailing dividend yield of 2.4%.

What else happened in FY22?

Qube achieved solid revenue and earnings growth in FY22 through organic growth in its operating division, margin improvement in the Patrick business, and the contribution from acquisitions.

The strong result also reflects higher volumes across most of the company’s core markets, including containers, grain, steel, most mining bulk commodities, and general cargo.

Despite slightly reduced volumes, Patrick Terminals delivered NPAT growth of 32% as the business benefited from operational efficiency initiatives. Qube holds a 50% interest in the container terminals business.

During the year, Qube also completed a $400 million off-market share buyback. Shareholders cheered this decision at the time, sending the Qube share price higher.

What did management say?

Commenting on the results, Managing Director Paul Digney was upbeat, saying:

In FY22, the strength across most of our core markets including containers, grain, steel, most mining bulk commodities, energy and general cargo enabled Qube to deliver strong earnings growth despite weakness in certain markets and continued cost and operational impacts from COVID-19.

It also demonstrates Qube’s ability to effectively mitigate cost pressures through scale, operational performance, and productivity initiatives, as well as through contractual mechanisms.

What’s next?

Looking ahead, the Qube share price will be supported by management’s expectations of continued strong growth in underlying revenue and earnings in its operating division.

Management is also anticipating strong growth in underlying earnings for Patrick. This will be driven by modest market growth, stable market share, and improved margins.

Encouragingly, Qube doesn’t expect cost inflation to materially impact its earnings. The company is able to recover higher costs through a combination of contractual protections, rate adjustments, and productivity improvement.

Qube share price snapshot

Despite today’s rise, the Qube share price has fallen 10% since the start of 2022. Zooming out further, the Qube share price has retreated 6% over the last 12 months.

For comparison, the S&P/ASX 200 Index (ASX: XJO) has backpedalled 7% this year. And it’s down 6% compared to this time last year.

The post Qube share price bounces 6% as dividend delights appeared first on The Motley Fool Australia.

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More reading

• Eagers share price edges higher after ‘robust first half’
• What investors are watching with Ethereum right now
• Zip share price lifts despite $1 billion loss for FY22
• Pendal share price soars 15% on takeover news
• Humm share price dips after profits tumble 25%

Motley Fool contributor Cathryn Goh 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 Eagers Automotive Ltd (ASX: APE) share price is bouncing back this afternoon after the company announced its results for the first half of 2022 on Thursday morning.

The Eagers share price is currently up 019% at $13.335. That comes after it fell as low as $12.74 earlier in the day, a fall of 4% on Wednesday’s closing price.

Let’s see what the ASX-listed automotive dealership company reported.

Eagers share price edges higher on 1H22 result

Here is a quick snapshot of the key results for 1H22:

• Revenue of $4.2 billion, down 10.3% from $4.7 billion in 1H21
• Net profit before tax fell 7.8%, from $267.4 million in 1H21 to $246.5 million
• Net profit after tax (NPAT) fell 11.6%, from $202.3 million in 1H21 to $178.7 million
• Earnings before interest, tax, depreciation, amortisation, and impairment (EBIDTAI) of $336.2 million, down 9.9% from $373.4 million in 1H21
• Announced a record interim fully franked dividend of 22 cents per share (cps) for 1H22

Revenue was adversely impacted by the one-off divestment of the Daimler Trucks in 2021 and ongoing supply chain constraints on new vehicle deliveries. Supply chain issues have caused disruption to logistics and labour.

As a result, Eagers’ bottom line also fell in line with revenue but to a lesser extent.

The company said demand for new vehicles continues to exceed supply as its order book is 32% greater on a like-for-like basis since December 2021.

Even though revenue fell and profit went down, operating cash flow rose from $204.2 million in 1H21 to $232.6 million.

A record ordinary fully-franked interim dividend of 22 cps was approved for payment on 23 September to shareholders who registered on 5 September. That’s a 10% increase on the 20 cps in 1H21.

Eagers’ dividend reinvestment plan will not operate in relation to the ordinary dividend.

What else happened in 1H22?

The automotive company continued to invest in scaling the independent pre-owned business easyauto123 to drive more revenue and volume growth across Australia and New Zealand.

Eagers rolled out new automotive retail formats like the AutoMall West located at Indooroopilly
Shopping Centre in west Brisbane, which opened in April.

The company continued to expand its network to include new vehicle energy manufacturers in the hybrid, electric and hydrogen space.

Eagers also announced plans to carry out an on-market share buyback of up to 10% of issued share capital. It said the buyback “reflects the Board’s focus on active capital management and is testament to the Company’s strong balance sheet and record available liquidity”.

The company reported $842.8 million of available liquidity at 30 June 2022, which it said was “a record level”. The liquidity position includes available cash and undrawn commitments under corporate debt facilities.

What did management say?

Commenting on the results, Eagers CEO Keith Thornton said:

The robust first half performance reflects the strength of our underlying business, disciplined management of our rebased cost profile and strong progress on strategic frowth initiatives, which have together enabled us to capitalise on favourable market dynamics.

Demand has materially exceeded supply during the first half and our key lead indicators, including new vehicle order bank, remain at record levels.

Our leading position in large addressable markets, balanced economic model and diverse geographic footprint, ensure the business is able to withstand changes in market conditions. In addition, the combination of growth from our existing business, new entrants to the market wanting to partner with us and strategic acquisition opportunities provide a significant platform for sustainable earnings growth over the long term.

What’s next for Eagers?

Management expects demand for vehicles to continue to outstrip supply in 2H22.

The management team is focused on enhancing productivity via property and staff and rolling out omnichannel offerings. It expects the ACT and South Australian acquisitions to be fully integrated in 2H22.

As for future acquisition opportunities, management will continue to evaluate this via existing partnerships and new market entrants.

Eagers share price snapshot

The Eagers share price has dropped by around 21% over the past year and 5% year to date, but is up 7% over the past month.

In comparison, the S&P/ASX 200 Index (ASX: XJO) has fallen 6% over the past year and 7% year to date, but has risen 4% across the last month.

Eagers has a market capitalisation of $3.4 billion.

AP Eagers is currently trading at a price-to-earnings multiple of around 10x.

The post Eagers share price edges higher after ‘robust first half’ appeared first on The Motley Fool Australia.

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• 5 ASX directors loading up on their companies’ shares in August
• This ASX share rocketed 29% last month, but it’s not too late to buy: Celeste
• Here are the top 10 ASX 200 shares today
• This ASX 200 director bought $1.5 million worth of his company’s shares in July… and he’s still buying

Motley Fool contributor Raymond Jang 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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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

As investors continue to wade in the choppy cryptocurrency waters, a few top tokens continue to generate most of the interest in this sector. Among the key tokens of note for most has been Ethereum (CRYPTO: ETH), given this crypto’s long-awaited merge, which will shift the Ethereum blockchain to a proof-of-stake network and transform the largest decentralized finance ecosystem in substantial ways.

As of 12:30 p.m. ET, Ethereum has moved 2.8% higher over the past 24 hours. Much of this move higher appears to be tied to the upcoming Ethereum merge, which now officially has a semi-hard date of mid-September to be completed.

We’re now approximately a week past the Goerli testnet merge, which was a success. However, investors have been looking forward to the next step in the official merge process, which is the TTD (or Terminal Total Difficulty), the final stage in the shift to proof-of-stake. Recent reports indicate that the TTD for this merge should be 58750000000000000000000, with many approximating Sept. 15-16 as the likely date range for the shift.

So what

This Ethereum merge has involved a number of very technical steps to move to these final stages. Three testnet merges, which were generally very successful, indicate that validators and participants are generally on board with these upgrades. With an official timeline on the table, investors stand to benefit from greater certainty, something that has become very important to Ethereum investors of late.

A series of delays with this merge has driven significant volatility in Ether prices this year. Alongside other structural concerns in the crypto space, ETH hit a low of less than $900 per token in June, before rallying to nearly $1,700 per token at the time of this writing. This strong move off the bottom suggests more confidence in the structural integrity of the crypto market, as well as more excitement than apprehension right now around the merge.

Now what

There’s always the potential this final merge could result in some snags for the Ethereum network. Accordingly, there’s a rather polarized view being displayed on social media between investors who are concerned about these risks, and those who are very bullish about the benefits of this merge. 

Overall, I think this merge should prove to be more bullish than bearish. That said, it’s likely to be volatile times ahead for the world’s second-largest cryptocurrency by market capitalisation, at least over the next few weeks.

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

The post What investors are watching with Ethereum right now appeared first on The Motley Fool Australia.

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More reading

• Why Ethereum, Polkadot, and Dogecoin are rallying nicely today
• Why Ethereum, Solana, and Dogecoin are falling today
• 3 cryptos I would regret not buying on the dip
• The Aussie-born crypto platform taking on Ethereum
• 2 cryptos that could lead the market recovery

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

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

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The Zip Co Ltd (ASX: ZIP) share price is in the green today after the company announced its full-year financial results for FY22.

Shares in the ASX buy now, pay later (BNPL) company are trading 1.8% higher at 99 cents at the time of writing, after touching an intraday high of $1.06 mid-morning.

Let’s go over the highlights from the company’s full-year report for the period ending 30 June 2022.

What did Zip report?

• Loss from ordinary activities after income tax up 63% year-over-year (YoY) to $1.10 billion
• Record revenue up 57% YoY to $620 million
• Record transaction volume (TTV) up 51% YoY to $8.7 billion
• Record transaction numbers up 80% YoY to $74.3 million
• Group cash earnings before taxes, depreciation, and amortisation at a $207 million loss
• Cash and liquidity of $279 million

When Zip’s losses are adjusted to account for non-recurring items, its adjusted loss before income tax was $256.5 million in FY22. The company’s largest once-off expense was $821.1 million in impairment of goodwill and intangibles, followed by a $20.3 million cost for global rebranding.

The expansion of its goodwill and impairment item losses were likely due to the changes in the fair market value and recorded costs of the company’s numerous acquisitions in FY21 and FY22.

During the reporting period, Zip acquired stakes in the companies Spotii, Central European BNPL, PayFlex, and Hemenal Finansman.

To help reduce costs in the future, Zip advised it decided to discontinue operations in Singapore and the United Kingdom and stop providing the Group’s Pocketbook, Trade, and Trade Plus products.

What else happened in FY22?

Cost of sales grew faster than revenue during the reporting period, growing 75.8% for a $469 million loss. This number included, among other items, bad debts and expected credit losses of $276.1 million, which grew 110%.

The company saw the greatest improvement in its the United States operating segment, with revenues growing 57% YoY to $603.1 million and transaction volumes up 67% to $4.09 billion.

Zip welcomed 11.4 million new customers, growing 56% YoY to 11.4 million, and 90.7 thousand merchants, growing 77% YoY.

What did management say?

Zip co-founder and global CEO Larry Diamond said:

In our half-year results, we acknowledged changes in the external environment were quicker and more severe than first anticipated. Against this backdrop, we changed strategy and shifted to delivering sustainable growth, right-sizing our global cost base and accelerating the path to profitability.

To that end, I want to share that we have already delivered on a number of initiatives to reduce cash burn, manage credit losses and improve unit economics. Our ability to pivot and adapt to the new world, showcases the resilience and viability of our business model as we focus on the opportunity ahead in FY23.

What’s next?

Zip’s end goal is to accelerate toward EBTDA profitability in FY24. It plans to do this by pursuing several avenues.

In its core markets, these include launching enterprise markets with top US retailers, enhancing its rewards program, launching new products, and innovating its existing product line.

A focus on reducing credit losses is also a priority, and it plans to accomplish this through enhanced credit management and streamlining repayments and collections.

Other initiatives will include improving cost base and margins by reducing its operating cost on technology and to third parties.

Zip share price snapshot

It’s been a challenging period for the Zip share price, down 86% in the past 12 months and 77.3% year to date. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is down around 7% since the start of 2022.

The company’s market capitalisation is $681 million based on today’s price.

The post Zip share price lifts despite $1 billion loss for FY22 appeared first on The Motley Fool Australia.

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More reading

• Earnings preview: Here are the ASX shares reporting today
• How did the Zip share price respond last time the company reported?
• Looking to buy Zip shares? Here’s what to look for in tomorrow’s results
• Why is the Zip share price sinking 5% on Monday?
• Why is the Block share price tumbling 6% today?

Motley Fool contributor Matthew Farley 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 ZIPCOLTD FPO. 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 Pendal Group Ltd (ASX: PDL) share price jumped 15% in morning trade as investors reacted to the news that the takeover by Perpetual Limited (ASX: PPT) is going ahead.

At the time of writing, the Pendal share price has retreated a little to $5.33, up 9.2%.

Investors have sent the Perpetual share price down in response — it’s currently in the red by 8.2%.

The two investment managers have agreed to a deal after “extensive engagement” between them.

What’s the acquisition price?

The fund manager revealed that Perpetual offered more for Pendal.

The takeover deal is priced at one Perpetual share for every 7.5 Pendal shares, plus $1.976 cash for each Pendal share. The offer will be reduced by the amount of any final dividend paid to Pendal shareholders for the six months to 30 September 2022.

Pendal outlined that this offer has an implied undisturbed value of $6.54 per Pendal share based on Perpetual’s closing share price on 1 April 2022. That was the last trading day before Pendal announced receipt of the offer on 4 April 2022. That value of $6.54 represented a 46% premium to the Pendal closing price on 1 April 2022.

Based on Perpetual’s closing price on 24 August 2022, the offer has an implied value of $6.016 per Pendal share. This represents a 23.3% premium to Pendal’s closing share price.

Pendal shareholders will own approximately 47% of the combined group. Up to three Pendal directors will join the Perpetual board after the implementation of the deal.

The Pendal board unanimously support the offer. It also has the “strong support” of the investment teams. There has been a commitment from Perpetual to preserve the “culture of investment independence”.

Why is this a good thing for shareholders?

The Pendal Chair, Deborah Page, wrote this in a letter to shareholders:

If the scheme is approved by you, our shareholders, the proposed transaction will see two iconic financial services firms brought together to create Australia’s pre-eminent global asset manager, with combined funds under management of $201 billion.

We believe this is a compelling opportunity for shareholders and the business alike. The combination will deliver a significant increase in scale, boost our position in an increasingly competitive global market and bring strategic benefits in the dynamic sectors in which we operate, both domestically and internationally.

Furthermore, the combined company, through its multi-brand strategy, culture of investment independence, expanded distribution network and enhanced sustainable and impact investing capability, will be well positioned to deliver long-term shareholder value.

What next for Pendal shares?

Pendal said shareholders don’t need to take any action at this stage.

Shareholders will receive a booklet ahead of the meeting at which they will vote on the takeover. Pendal expects to hold the meeting either in December 2022 or early 2023. The timing will depend on when they receive regulatory approvals and the consent of clients.

Pendal share price snapshot

Despite today’s rise, Pendal is still down by 8% in 2022 to date.

The post Pendal share price soars 15% on takeover news appeared first on The Motley Fool Australia.

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More reading

• Perpetual share price tumbles on full-year earnings and takeover news
• Here are the top 10 ASX 200 shares today
• Perpetual shares climb amid response to media speculation
• Looking for value: The ASX shares this fundie is holding amid rising inflation

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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