The Liontown Resources Limited (ASX: LTR) share price is off to the races today.

Liontown shares closed yesterday at $1.39. The ASX lithium producer is currently trading for $1.61 per share, up 16% at time of writing.

The Liontown share price leap today follows the company’s announcement that it’s entered into a binding lithium supply agreement with US electric vehicle giant Tesla Inc (NASDAQ: TSLA).

Highlights below…

Liontown share price soars on agreement

ASX investors are bidding up the Liontown share price after the battery materials company reported that Tesla has agreed to purchase Lithium Spodumene Concentrate from its new $473 million Kathleen Valley Lithium Project, located in Western Australia.

The initial 5-year agreement is expected to commence in 2024. It will see Liontown supply Tesla with 100,000 dry metric tonnes (DMT) of Lithium Spodumene Concentrate in the first year, with Tesla buying 150,000 DMT in the following years.

The agreement remains conditional on Liontown commencing commercial lithium production at its Kathleen Valley Lithium Project by 2025, along with the 2 parties completing negotiations by 30 May 2022.

Liontown expects to start major construction activities at Kathleen Valley by the fourth quarter of 2022.

The Liontown share price could also be getting a boost from the report that Tesla’s purchase agreement equates to approximately one-third of the project’s initial forecast production capacity.

With the new Tesla agreement taken into account, Liontown said it’s now contracted more than half of its forecast production from the Kathleen Valley Lithium Project during the first 5 years of operation.

What did management say?

Commenting on the agreement, Liontown’s CEO Tony Ottaviano said:

Securing our second offtake sales agreement is another fantastic milestone for Liontown towards the development of the Kathleen Valley Lithium Project, and we are absolutely delighted to have signed this agreement with leading EV manufacturer, Tesla… Our shareholders should be proud that future Tesla cars will be powered by Liontown lithium.

We are also continuing to progress discussions with additional potential customers for the remaining available production and we are looking forward to announcing additional arrangements in the weeks ahead as we continue to implement our strategy to develop the project and deliver value for our shareholders.

Liontown share price snap shot

The Liontown share price is up an impressive 260% since this time last year.

By comparison the S&P/ASX 200 Index (ASX: XJO) has gained 5% over the 12 months.

So far in 2022, Liontown shares are down 10%.

The post Liontown (ASX:LTR) share price rockets 16% today on Tesla lithium deal appeared first on The Motley Fool Australia.

More reading

• Is Tesla stock a buy?
• This is how we’ll know the share market has bottomed
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• ‘Strong support’: Here’s why the Liontown (ASX:LTR) share price is pouncing higher today
• Why Tesla stock was on fire today

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

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The Corporate Travel Management Ltd (ASX: CTD) share price is up more than 5% today amid the company announcing a 120% jump in revenue and other income.

Corporate Travel released its half-year results this morning, spurring its share price to $23.97 at the time of writing, a 5.13% gain.

Let’s take a look at what the travel company reported.

Corporate travel share price ascends amid half yearly results

Highlights of the company’s half-year (H1 FY22) results include:

• Total revenue and other income surged 120% on the previous corresponding period (PCP) to $163 million
• Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of $18.2 million, a 219.7% boost on the PCP. (In H1 FY22, underlying EBITDA was -$15.2 million)
• Underlying net loss after tax of $0.4 million, compared to a loss of $26.6 million in the PCP
• Total transaction value (TTV) of $2,083.1 million, a 416% boost on the PCP

What else happened in the half?

The COVID-19 Omicron variant cut down travel activity between November and January. However, Corporate Travel Management is expecting this to ramp up in areas where travel restrictions have been lifted.

The company is seeing a quick rebound in February in the United Kingdom and North America.

In the first half of 2022, the company invested in rebuilding staff levels in preparation for the travel recovery.

In North America, the company saw a 213% boost in revenue and other income to $92 million. Client wins are at the highest levels in the company’s history in North America. These are at a greater rate than prior to the pandemic.

Revenue in Europe also jumped by 229% to $43.8 million. Australia and New Zealand was impacted by restrictions during the half, however, underlying EBITDA still finished in the green at $0.9 million. Domestic travel is bouncing back in the ANZ region.

Asia losses were “well contained” despite travel restrictions in most of the region in the first half of 2022.

Management comment

Commenting on the results, managing director Jamie Pherous said:

The strategic acquisitions we made during the pandemic have transformed CTM into a much larger business with greater exposure to the North America market which, along with the UK market, is rebounding sharply.

Revenue in North America is now above pre-CTM COVID levels shows, pointing to the potential of the business when the travel market fully recovers. Strategic M&A has made North America our largest region and integration execution is well advanced.

Because of our expanded global footprint and strong financial position, we are targeting EBITDA of $265m in full recovery compared with $150m pre-pandemic

What’s next

Corporate Travel Management expects to complete the acquisition of Helloworld Corporate in the third quarter of 2022, subject to regulatory and contractual approvals.

The company didn’t offer a guidance for FY22 due to short term uncertainties. However, the company believes underlying EBITDA will build in February and March.

When the market fully recovers, Corporate Travel Management estimates it can achieve an underlying EBITDA of $265 million and revenue of $810 million.

Corporate Travel share price summary

The Corporate Travel share price has surged 32% in the past year and more than 8% year to date.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has returned around 5% over the past year.

Corporate Travel has a market capitalisation of roughly $3.4 billion based on today’s share price.

The post Corporate Travel (ASX:CTD) more than doubles its revenue amid easing COVID-19 travel restrictions appeared first on The Motley Fool Australia.

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• Top broker says Corporate Travel Management (ASX:CTD) shares can rise 36%

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 Corporate Travel Management Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Lark Distilling Co Ltd (ASX: LRK) share price is freefalling during Wednesday morning trade.

During market open, the whisky producer’s shares hit an intraday low of $3.48, before slightly bouncing back.

At the time of writing, Lark shares are now changing hands at $3.60, down 20.88%.

Lark CEO shock resignation

Investors are selling off Lark shares following the unexpected announcement regarding its most senior leader.

In a statement to the ASX, Lark advised that its managing director and CEO, Geoff Bainbridge has tendered his resignation.

The reason given as to why Mr Bainbridge has decided to depart the company is due to a personal matter. This was brought to the attention of the board late yesterday afternoon.

The immediate effect of Mr Bainbridge’s resignation will see current non-executive director, Laura McBain assume the role on an interim basis.

Ms McBain’s previous experience includes CEO and managing director of ASX-listed Bellamys from 2014 to 2017. Prior to this, Ms McBain held the title of CEO/general manager of the infant formula company since 2007.

During her time, Ms McBain was responsible for change, innovation and business growth including expansion into South East Asia and China.

Ms McBain also held the title of managing director of Maggie Beer from 2017 to 2019, and former non-executive director of Export Finance Australia from 2014 to 2020.

Lark stated that it had already begun its global CEO search in December 2021 as part of its succession planning. The process will now be accelerated to find a permanent replacement for the top job.

About the Lark share price

Over the last 12 months, the Lark share price has surged to register a gain of 116% for investors.

The company’s shares accelerated from July to mid-October, reaching a 52-week high of $5.60. Since then, its shares have gradually declined under the $5 mark before sinking to $3.60 today.

Lark commands a market capitalisation of roughly $271 million, with approximately 75.28 million shares on its registry.

The post Here’s why the Lark (ASX:LRK) share price is nosediving 21% today appeared first on The Motley Fool Australia.

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• Is it a buy? Top brokers rate BHP (ASX:BHP) share price after solid earnings
• More lithium! Here’s why the Ioneer (ASX:INR) share price is surging 10% higher today
• In the dirt: Evolution Mining (ASX:EVN) share price slips amid 60% profit plunge
• Profit surge fails to boost Santos (ASX:STO) share price today
• Cheers! Treasury Wine (ASX:TWE) share price jumps 13% on half year results

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in ASX resources giant BHP Group Ltd (ASX: BHP) are sliding from the open today and now trade at $46.98 apiece.

Following the release of the miner’s better than expected half-yearly results yesterday, analysts at several investment firms have chimed in on BHP’s investment debate. Let’s take a closer look.

Is BHP a buy after its strong earnings?

Analysts at Australian investment bank Macquarie were quick to jump in on the commentary. They note BHP’s strong cash flow result underpinned by working capital management in 1H FY22.

This enabled BHP to declare a stronger than expected dividend payout. This trumped analysts’ estimates at both that level and the net profit level.

In fact, the mining giant’s underlying results were 6%-8% higher than what Macquarie had baked into its own modelling, according to the broker.

It was happy with the company’s balance sheet and amount of leverage at 31 December. Macquarie responded to management’s guidance on net debt.

“Post dividend payment,” the broker said, “BHP’s net debt will have increased to $13.7 billion, within the new wider guidance range.” That compares to roughly $6 billion at the end of 2021.

It will be interesting to see what this will mean for the BHP share price.

Meanwhile, over at RBC Capital Markets, analysts note that BHP’s debt guidance of $5 billion to $15 billion still leaves plenty of headroom for the miner to make acquisitions, future buybacks, or bump its dividend further.

Not to mention, if commodity prices continue their current rally, the upside case is even stronger for this to happen, according to the broker.

RBC analysts reckon BHP’s results were an “incremental positive”. They suggest investors might continue bidding up shares on what are “already very strong market perceptions” of the miner.

BHP has managed to “drive a successful unification” whilst posting “a very strong half-year financially, leaving the group with a blank canvas for future M&A or cash returns,” the broker says.

Macquarie rates BHP as a buy and values the company at $51 per share. Whereas RBC has its rating as sector perform with a $46 price target.

After a string of broker updates yesterday, the consensus still has BHP weighted towards a hold. The average price target is $46.23, which is a small amount of downside potential yet to be priced in.

BHP share price snapshot

The BHP share price has had a difficult year, although it has regained steam lately. In the last 12 months, BHP shares are barely breakeven, 0.03% in the red based on the current price. Although they are up 13% year to date.

On closer inspection, the BHP share price has tracked the S&P/ASX 300 Metals & Mining Index (ASX: XMM) closely over the last year, as shown in the chart below.

The post Is it a buy? Top brokers rate BHP (ASX:BHP) share price after solid earnings appeared first on The Motley Fool Australia.

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

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The Ioneer Ltd (ASX: INR) share price has been a strong performer on Wednesday.

In morning trade, the US based lithium-boron producer’s shares are up 10% to 62.5 cents.

Why is the Ioneer share price racing higher?

Investors have been bidding the Ioneer share price higher today following the release of an update on a lithium offtake agreement at its Rhyolite Ridge Lithium-Boron Project in Nevada.

According to the release, EcoPro Group, a major cathode supplier for global battery manufacturers, has agreed to increase its offtake volume with Ioneer to 7,000 tonnes per annum. This compares to 2,000 tonnes per annum previously and is the maximum amount under the June 2021 binding agreement.

EcoPro expects to convert this lithium carbonate into high purity lithium hydroxide at its recently complete integrated cathode plant in Korea.

Management notes that this agreement represents approximately 34% of Ioneer’s annual lithium carbonate production from Rhyolite Ridge in the first three years of operation. It is expecting to produce an annual average of approximately 20,600 tonnes of lithium carbonate per year over the 26-year mine life.

Management commentary

Ioneer’s Managing Director, Bernard Rowe, commented: “We are delighted that EcoPro Innovation has increased their lithium carbonate offtake commitment from Rhyolite Ridge. As a major cathode supplier for global battery manufacturers EcoPro Group is an ideal partner for Ioneer. We are encouraged to support the US car manufacturing industry and look forward to continuing to work with EcoPro Group in these endeavours.”

This sentiment was echoed by EcoPro Innovation’s President, Anthony Kim.

He said: “We have always had great relationship with ioneer and we are pleased to strengthen our partnership with ioneer by increasing lithium carbonate offtake volume. We, EcoPro as a group, have intentions to expand overseas to support environmental policies such as carbon neutralization and net zero emission. With ioneer as a partner, we look forward to contributing to the electrification of transportation in the USA.”

The post More lithium! Here’s why the Ioneer (ASX:INR) share price is surging 10% higher today appeared first on The Motley Fool Australia.

More reading

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

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The Evolution Mining Ltd (ASX: EVN) share price is in the red after releasing its much-awaited half-year results.

In early morning trade, shares in the gold mining company are down 0.63% to $3.91. This places the company’s shares at a 28% discount to its 52-week high.

Evolution Mining share price sinks on steep profit fall

Here are the highlights of the company’s latest results:

• Revenue down 9% from prior corresponding period to $898.6 million
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) down 23.6% to $393.3 million
• Underlying net profit after tax (NPAT) down 57.2% to $100.1 million
• Statutory NPAT down 60.3% to $90.8 million
• Fully franked interim dividend of 3 cents per share, down from 7 cents per share
• Total gold production of 318,766 ounces at an all-in sustaining cost of $1,381 per ounce

What happened during the first half?

During the six months ending 31 December 2021, Evolution Mining experienced a reduction in revenue and earnings compared to the same period a year earlier.

According to the release, the company’s revenue failed to surpass the previous first half due to low gold volume from Mt Rawdon and Red Lake mines. On top of this, Evolution achieved a 4% lower gold price at $2,371 per ounce.

Other key events during the half-year period included the Kundana acquisition from Northern Star Resources Ltd (ASX: NST). Evolution processed its first higher grade ore from the mine in late August. Efforts to reduce duplicate activities and recognise some synergies are currently underway.

In November, the Evolution Mining share price moved to the upside following the $1 billion acquisition of the Ernest Henry mine in Queensland. The Australian gold mining giant has a remaining $200 million payable on 6 January 2023 for the acquisition.

ASX-listed Evolution Mining now estimates its mineral resources to be around 29.6 million ounces. This represents a 12% increase year-on-year.

What did management say?

Evolution Mining executive chair Jake Klein commented on the result:

The half-year to 31 December 2021 has been transformational for Evolution. The portfolio has benefitted from key acquisitions and a significant investment in growth projects at our cornerstone assets, which is supported by a high quality Mineral Resource and Ore Reserve base, and our business is well-positioned to deliver a very strong second half.

Full ownership of Ernest Henry will deliver a material increase in cash flow and financial performance and was considered when declaring the interim dividend. Evolution’s history of dividend payments with almost A$1 billion paid since 2013 demonstrates our commitment to maximising shareholder returns.

What’s next?

In terms of guidance, Evolution Mining expects to produce 670,000 to 725,000 ounces of gold in FY22. Notably, this is forecast to be done with an AISC between $1,135 to $1,195 an ounce.

On the dividend front — investors will need to be on the register before 28 February 2022 when shares will go ex-dividend. From there, shareholders can expect to receive 3 cents per share on 25 March 2022.

Evolution Mining share price snapshot

Despite inflation fears, the Evolution Mining share price has been sitting in the red over the last 12 months. Shareholders are have witnessed a 16.9% fall in the gold miner’s shares during this time. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is up 4.3% in the same timeframe.

The Evolution Mining share price is now trading on a price-to-earnings (P/E) ratio of around 19 times.

The post In the dirt: Evolution Mining (ASX:EVN) share price slips amid 60% profit plunge appeared first on The Motley Fool Australia.

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• Why is the Evolution Mining (ASX:EVN) share price leaping 8% today?

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 Bruce Jackson.

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The Santos Ltd (ASX: STO) share price is sliding in early trade, down 3%.

Santos closed at $7.40 per share yesterday and is currently trading for $7.18.

Below we look at the highlights from the ASX 200 energy company’s 2021 full year financial results.

Note that this is the first time Santos is releasing results since its merger with former competitor Oil Search was completed in December.

Santos share price slides despite record free cash flow

• Product sales revenue of US$4.71 billion, up 39% year-on-year
• EBITDAX (earnings before interest, tax, depreciation, depletion, exploration, evaluation and impairment) of US$2.81 billion, up 48% from US$1.90 billion in 2020.
• Underlying profit increased 230% to US$946 million
• Final dividend 5 US cents per share (cps), 70% franked, up from 5.0 cps in 2020

What else happened during the year?

In 2021, Santos produced 92.1 million of barrels of oil equivalent (mmboe), up 3% from the prior year.

Sales volume slipped however, down 3% to 104.2 mmboe from 107.1 mmboe the prior year.

2021 saw Santos deliver a net profit after tax (NPAT) of US$658 million, up 284% year-on-year. The company said 2021 NPAT includes losses incurred on commodity hedging and costs associated with acquisitions and one-off tax adjustments. It attributed the NPAT leap to significant impairment that were included in its 2020 reporting.

Santos also saw its free cash flow hit a record high, surging by 103% year-on-year to US$1.50 billion.

It credited the growth in overall results to higher oil and LNG prices over the year along with the 3 weeks contribution from the Oil Search assets during the final stretch of 2021.

What did management say?

Commenting on the results, Santos CEO Kevin Gallagher said:

The highlight of the year was the completion of our merger with Oil Search. The merger delivers increased scale and capacity to drive our disciplined, low-cost operating model and unrivalled growth opportunities over the next decade – all with a vision of becoming a global leader in the energy transition…

2021 brought global energy security into the spotlight with higher prices and a supply crunch in the wake of rapidly recovering demand and a lack of investment in new supply.

It is vitally important that investment in new supply occurs and in a sustainable way. At Santos, we are focussed on supplying critical fuels more sustainably to meet society’s demand.

What’s next?

Santos forecasts that 2022 production will increase to 100–110 million mmboe. It expects sales volumes in the range of 110–120 mmboe.

The ASX 200 energy giant forecasts spending on major growth projects to be around US$1.15–US$1.3 billion. Working off an average oil price of US$65 per barrel in 2022, it expects to generate enough free cash flow to fund that growth.

While this year’s final dividend carried 70% franking credits, Santos said that based on its carry-forward tax losses, it is unlikely to generate franking credits for the next several years.

Santos share price snapshot

The Santos share price has gained 9% so far in 2022, compared to a loss of 5% posted by the S&P/ASX 200 Index (ASX: XJO).

The post Profit surge fails to boost Santos (ASX:STO) share price today appeared first on The Motley Fool Australia.

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

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The Treasury Wine Estates Ltd (ASX: TWE) share price is racing higher today following the release of its half year results.

In morning trade, the wine giant’s shares jumped 13% to $11.90.

Treasury Wine jumps on half year results

• Net sales revenue down 10.1% to $1,267 million
• Net sales revenue per case up 16% to $95.60
• EBITS down 6.7% to $262.4 million
• EBITS margin improve 0.8 percentage points to 20.7%
• Net profit after tax down 7.5% to $109.1 million
• Fully franked interim dividend of 15 cents per share declared

What happened during the first half?

For the six months ended 31 December, Treasury Wine reported a 10.1% decline in revenue to $1,267 million.

This reflects softer sales across all segments. Penfolds reported a 16.3% decline in revenue to $382.7 million, Treasury Americas posted an 8.5% decline in revenue to $465.9 million, and Premium Brands saw its revenue fall 5.6% to $418.4 million.

And while is Americas and Premium Brands businesses managed to record strong EBITS growth despite these sales declines, a 19% decline in EBITS from the key Penfolds business weighed on its earnings and led to a 6.7% decline in group EBITS to $262.4 million.

Management advised that the Penfolds business was unsurprisingly impacted by reduced shipments to Mainland China, which were partly offset by strong growth across global priority markets and channels.

Management commentary

Treasury Wine’s Chief Executive Officer, Tim Ford, was pleased with the half.

He commented: “We are very pleased with our first half results, where we delivered comparable EBITS growth of 28% when taking into account the effective closure of the Mainland China market, while at the same time continuing with the implementation of important changes across the business.”

“This performance reflects the focused execution of our plans and strategic priorities, led for the first time by Penfolds, Treasury Americas and Treasury Premium Brands. Each division is now on a clear and positive trajectory towards their respective long-term growth objectives, with the benefits of separate focus and accountability already very evident throughout TWE,” he added.

“Growth and innovation”

Possibly giving the Treasury Wine share price a lift today was management’s commentary on its outlook. Mr Ford revealed that the company is embarking on a new chapter following the disruption of the last two years.

He said: “Following the past two years of significant change within TWE and the markets in which we operate, we have shifted our focus from a mindset of ‘recovery and restructuring’ to one of ‘growth and innovation’. We have great confidence that by leveraging the unique strengths of our business – our people, our brands and our asset base – we are well placed to capitalise on the significant opportunities across the global markets in which we operate.”

In respect to the second half, the company expects that trading conditions will be broadly consistent with those in the first half across all key global markets and channels.

Looking further ahead, the company’s “financial objective remains to deliver sustainable top-line growth and high-single digit average earnings growth over the long-term.”

The post Cheers! Treasury Wine (ASX:TWE) share price jumps 13% on half year results appeared first on The Motley Fool Australia.

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

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The Fortescue Metals Group Ltd (ASX: FMG) share price is slipping lower on Wednesday morning. This comes as the iron ore miner released its half-year results for the 2022 financial year.

At the time of writing, the mining giant’s shares are swapping hands for $20.81, down 3.61%.

Fortescue share price backtracks on half-year result

The Fortescue share price is in the red today after the company delivered its result for the six months ending 31 December 2021. Here are some of the key highlights:

• Total revenue of US$8.1 billion, down 13% (H1 FY22 US$9.3 billion)
• Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of US$4.76 billion, down 28% (H1 FY21 US$6.64 billion)
• Underlying net profit after tax (NPAT) of US$2.8 billion, down 32% (H1 FY21 US$4.08 billion)
• Earnings per share (EPS) of US 90 cents, down 32% (H1 FY21 US$1.33 per share)
• Fully-franked interim dividend of 86 cents per share, 70% of H1 FY22 NPAT dividend payout

What happened in H1 FY22 for Fortescue?

Fortescue recorded its highest ever half-year shipments of 93.1 million tonnes, following the integration of its Eliwana project.

In addition, the company achieved industry-leading C1 costs of US$15.28 per wet metric tonne. This was 20% higher than the H1 FY21 result due to price increases of key input costs such as diesel, other consumables, labour rates, the integration of Eliwana as well as mine plan-driven cost escalation.

Overall, the miner recorded an average revenue of US$96 per dry metric tonne, a 70% realisation of the average Platts 62% CFR Index (H1 FY21 US$114/dmt, 90% realisation).

The board declared a cash position of US$2.9 billion and gross debt of US$4.6 billion at the end of the calendar year.

However, a possible catalyst for today’s fall appears to be the company’s dividend cut. Shareholders will receive an interim dividend of 86 cents per share, down 41% from the $1.47 paid in the prior corresponding period.

What did management say?

Fortescue CEO Elizabeth Gaines commented on the milestone accomplishment, saying:

Fortescue’s performance for the first half of FY22 has been outstanding and we are proud of the entire team who have delivered record half year shipments and contributed to net profit after tax of US$2.8 billion, the third highest in Fortescue’s history.

… We have continued to reinvest in the business and invest in growth. Our major project, Iron Bridge is progressing well with first production scheduled in December 2022. We remain focused on managing industry cost pressures and challenges posed by Western Australia’s ongoing border restrictions, and we are working closely with the Western Australian Government and relevant authorities to ensure we have access to the specialist skills required.

What’s the outlook for Fortescue?

Looking ahead, Fortescue provided guidance for FY22, stating the following:

• Iron ore shipments in the range of 180 million tonnes to 185 million tonnes
• C1 costs between US$15.00 to US$15.50 per wet metric tonne (based on assumed average exchange rate of AUD: USD 0.72)
• Capital expenditure (excluding FFI) of US$3 billion to US$3.4 billion.

The post Fortescue (ASX:FMG) share price slips on FY22 half-year results appeared first on The Motley Fool Australia.

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• Hunger Games? Here’s why more Fortescue (ASX:FMG) execs are calling time out on the miner
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in vertically integrated Australian real estate investment trust (REIT) Vicinity Centres (ASX: VCX) are rocketing today. It follows the company announcing its results for the six months ended 31 December 2021.

Vicinity Centres share price is climbing at the open on Wednesday, up 9.23% from yesterday’s close at $1.83.

Vicinity Centres back in the money

The second-largest listed manager of Australian retail property advised on a number of investment highlights today:

• Statutory net profit after tax (NPAT) of $650.2 million, up $1.04 billion from statutory net loss after tax of $394.1 million in 1H FY21
• Funds from operations (FFO) of $287.7 million or 6.32 cents per share, compared to 1H FY21 result of $267.1 million or 5.87 cents per share
• Interim distribution of 4.7 cents per share, reflecting a payout ratio of 84% of adjusted FFO (AFFO) – up from 62%
• Strong balance sheet maintained, with low gearing of 26.3% and liquidity of $1.8 billion
• FY22 FFO per security expected to be in the range of 11.8 cents to 12.6 cents
• AFFO per security expected to be in the range of 9.5 cents to 10.3 cents

What else happened this quarter for Vicinity?

The hallmark of Vicinity’s results this half was a $1 billion gain in statutory NPAT of $650.2 million, up from a loss of $320 million this time last year.

This result was underpinned by FFO of $287.7 million and “a non-cash net property valuation gain of $320.1 million.”

Even with the pandemic, Vicinity says, its Australian operations grew almost 8% in FFO year over year.

During the half, Vicinity completed 643 leasing deals, resulting in an average spread of -6.4%. This is a big jump on the 542 deals at a spread of -12.6% in 1H FY21.

It also leased 201 vacant stores during the half. As such, portfolio performance ensured that occupancy was maintained at 98.2% at the end of December 2021.

Not only that, collection of gross rental billings averaged 80% for the period, up sequentially on the previous quarter, according to the release.

Total portfolio retail sales increased by 7%, curiously a reflection of strong growth in Victoria at an increase of 17%. In states that didn’t feel much impact of COVID-19, growth was 4.5%.

“Given that NSW was in lockdown for a higher proportion of 2021 versus 2020, MAT retail sales were down 5.1%,” the company noted.

Management commentary

Speaking on the announcement, Vicinity CEO and managing director Grant Kelley said:

The first half of FY22 was another challenging period for Vicinity, our retail partners and the retail sector more broadly. However, despite continued COVID-related disruptions and a greater proportion of our assets being in lockdown this period, our disciplined approach to cash collection and retailer support, together with higher than anticipated tenant retention and resilient ancillary income underpinned our significantly improved result.

What’s next for Vicinity?

The release notes that Vicinity expects FY22 FFO per security to be in the range of 11.8 cents to 12.6 cents. While AFFO is expected to be in the range of 9.5 cents to 10.3 cents.

Vicinity is targeting a full-year distribution payout range of 95%-100% of AFFO, according to the guidance figures posted today.

“In summary, today’s result and our FY22 guidance are testament to the high-performing and resilient team we have at Vicinity and the strength of our asset portfolio and retail partnerships,” Kelly concluded.

Vicinity Centres share price snapshot

In the past 12 months Vicinity Centres has held gains, up 14.33% on the year, based on the current price. With today’s boom in the Vicinity share price, year to date the REIT is up 8.58%.

The post Sky high profits: Vicinity Centres (ASX:VCX) share price rockets 9% following half-year results appeared first on The Motley Fool Australia.

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

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