The Whispir Ltd (ASX: WSP) share price is gaining today, up more than 2% in morning trade. At the time of writing, the Whispir share price has retreated slightly to $4.16, down 1.2%. 

This comes following the release of the cloud-based communication platform provider’s financial results for the half-year ending 31 December (H1 FY21).

Financial results for H1 FY21

In this morning’s ASX release, Whispir reported a 29.2% increase in its Annualised Recurring Revenue (ARR) to $47.4 million. That’s up from ARR of $36.7 million over the prior corresponding half year. The company credited most of the boost to increased activity from its existing customers.

Total revenue of $23.1 million was up 27.3% over the prior corresponding period (PCP).

Bringing 77 net new customers aboard during the half-year, Whispir reported it now has 707 customers, an increase of 38.9% from the first half of the 2020 financial year.

Earnings before income, taxes, depreciation and amortisation (EBITDA) was $(1.8) million. Though still negative, this represents a 61% improvement year-on-year.

Commenting on the results, Whispir’s CEO Jeromy Wells said:

Our Australia and New Zealand (ANZ) operations continue to outperform our expectations with revenue increasing 30.2% over the PCP. Our enterprise customers are spending more with us as they increase use cases, utilising our contemporary tools to solve more of their communications challenges. This region is also experiencing strong growth in new customers as organisations look for platforms that can be implemented quickly to digitise their business communications…

In line with our five-year product roadmap, we continue to add new features and functionality to improve user experience. Enhanced platform functionality with AI-inferred insights will enable us to better serve our existing customers with additional data driving more valuable, higher margin products and supporting our transition to becoming a communications intelligence company.

Whispir spent $4.6 million on research and development (R&D) during the half-year to deliver its five-year product roadmap. The company expects to increase its R&D expenditures in the second half of the 2021 financial year.

Looking ahead, Whispir upgraded its guidance of the FY21 EBITDA from $(6.2)–$(4.8) million to $(4.5)­–$(3.0) million.

Whispir share price snapshot

Whispir is among the star performers over the past 12 months, with shares up 198%. By comparison, the All Ordinaries Index (ASX: XAO) is down 3% over that same time.

So far in 2021, the Whispir share price is up just over 17%.

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

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Origin Energy Ltd (ASX: ORG) shares have had a lousy 12 months, having dropped more than 40% over the past year. The bad news keeps coming for shareholders with the Origin share price dipping another 1.74% in early trade today.

This comes on the back of the energy giant’s FY2021 half-year results (1H FY21) which were released to the market this morning. 

Let’s take a look at how Origin has been performing.

What’s impacting the Origin share price?

The Origin Energy share price is on the slide this morning after the company reported its statutory profit tanked from $599 million in 1H FY20 to $13 million in 1H FY21. Underlying profit also fell from $528 million in 1H FY20 to $224 million in 1H FY21.

Origin’s earnings per share (EPS) also took a dive. Statutory EPS dipped to 0.7 cents in the half compared with 34 cents in the prior half. Meanwhile, underlying EPS fell from 30 cents in 1H FY20 to 12.7 cents in 1H FY21.

Investors are driving down the Origin share price after the company slashed its interim dividend to 12.5 cents, down from 15 cents in the prior corresponding period. 

Origin reported free cash flow for the period of $655 million as at 30 December 2020. This compares to the $680 million that was reported for the first half of FY20.

CEO comments

Discussing what lies ahead for the business, Origin CEO Frank Calabria said:

Throughout the first half, Origin continued to navigate the very challenging operating conditions facing the sector, as the pandemic caused a reduction in energy demand and depressed prices across key commodities…

The recent rally in oil and gas markets is expected to have a positive impact on Australia Pacific LNG’s earnings in the second half, given the lag in contract LNG prices.

However, as flagged in our recent earnings update, the near-term outlook for Energy Markets is more challenging. A mild summer has compounded already weaker demand and reduced volatility, gas supply costs are expected to increase, and wholesale electricity prices remain depressed, particularly as renewable supply continues to come online.

Outlook

Origin provided updated guidance for FY21 on 4 February 2021. It advised that the company’s outlook is dependent on no material changes in market conditions or the regulatory environment. It also cautioned that considerable uncertainty remains due to the potential ongoing impacts of coronavirus.

The company’s energy markets earnings before interest, tax, depreciation and amortisation (EBITDA) for the 2021 financial year is expected to be in the range of $1 billion to $1.1 billion.

Based on the current Origin share price of $4.52, the company commands a market capitalisation of around $8.1 billion with 1.8 billion shares outstanding.

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Motley Fool contributor Gretchen Kennedy owns shares of Origin Energy Limited. 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 Fortescue Metals Group Limited (ASX: FMG) share price is pushing higher on Thursday following the release of its half year results.

At the time of writing, the iron ore producer’s shares are up 2% to $24.93.

How did Fortescue perform in the first half?

For the six months ended 31 December, Fortescue delivered a 44% increase in revenue to US$9,335 million and a 66% lift in net profit after tax to US$4,084 million.

This strong result was of course driven by the sky high iron ore price. During the half, the company commanded an average realised price of US$114 per dry metric tonne for its iron ore. This was a 42.5% increase on the prior corresponding period.

This is actually a larger increase that the 62% Fe CFR Platts index over the same period. Management advised that the outperformance of the index reflects the enhanced contribution of higher value products meeting the demands of its customers, as well as iron ore market supply constraints from South America.

Also supporting its growth was a 2.4% increase in shipments to a total of 90.7 wet metric tonnes.

Fortescue increases its dividend

In light of its strong first half and its positive outlook, the Fortescue board has declared a fully franked A$1.47 per share interim dividend. This is an increase of 93.4% on the prior corresponding period.

Based on the current Fortescue share price, this interim dividend alone equates to a fully franked 5.9% yield.

Fortescue’s interim dividend also represents a payout ratio of 80% of net profit after tax. This is in line with its guidance of maintaining a payout ratio at the top end of the Board approved range of 50% to 80% of net profit after tax.

Management advised that the interim dividend declared reflects the strong operating cash flow environment, confidence in the outlook for the second half of FY 2021, and the strength of the balance sheet.

Outlook

Possibly holding back the Fortescue share price slightly today has been a change to its guidance due to the stronger Australian dollar.

While Fortescue continues to target iron ore shipments of 178mt to 182mt, it has revised its C1 costs and capital expenditure guidance.

C1 costs are now expected to be US$13.50 to US$14.00 per wet metric tonne. This compares to previous guidance for US$13.00 to US$13.50 per wet metric tonne. Whereas capital expenditure is now expected to be at the upper end of its previous guidance range of US$3 billion to US$3.4 billion.

This is based on a revision to the assumed FY 2021 average exchange rate from 0.70 to 0.75 USD/AUD.

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Motley Fool contributor James Mickleboro 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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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.

Shopify Inc (NYSE: SHOP) reported its fourth-quarter earnings before the market open on Wednesday, and even though the e-commerce platform delivered impressive top- and bottom-line results, its guidance left investors wanting for more. The company cautioned that the frantic pace of growth that characterized much of the past year would slow in 2021, giving investors pause.

The company reported revenue of $978 million, up 94% year over year. Adjusted net income of $199 million generated adjusted earnings per share (EPS) that soared 198% to $1.58. This easily surpassed analysts’ consensus estimates, which called for revenue of $910 million and adjusted EPS of $1.25. 

There was plenty of stout growth that underpinned Shopify’s robust top- and bottom-line performance. Subscription solutions revenue grew an impressive 53% year over year to $279 million, spurred on by monthly recurring revenue (MRR) of $83 million, which was also up 53%.

It was merchant solutions that stole the show, however, with revenue that grew 117% to $698 million. This was driven higher by gross merchandise volume (the value of products that changed hands on Shopify’s platform) that soared 99% to $41 billion in the fourth quarter.

While these number all gave investors cause to celebrate, shareholders focused instead on Shopify’s guidance, sending the stock lower. The company didn’t provide specific numbers for the upcoming quarter or full year, but rather painted broad strokes of how it sees 2021 playing out.

Management noted that growth would be “driven by more merchants … joining the platform in a number lower than the record in 2020, but higher than any year prior to 2020 … We expect that we will continue to grow revenue rapidly in 2021, albeit at a lower rate than in 2020.” 

Shopify said it will continue to invest “aggressively” to fuel growth.

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

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Danny Vena owns shares of Shopify. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Shopify. 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 Wesfarmers Ltd (ASX: WES) share price has tumbled lower following the release of its half year results.

In morning trade, the conglomerate’s shares are down 3% to $52.50.

How did Wesfarmers perform in the first half?

For the six months ended 31 December, Wesfarmers reported a 16.6% increase in revenue to $17,774 million.

This was driven by a 24.4% increase in Bunnings revenue to $9,054 million, a 23.7% jump in Officeworks revenue to $1,523 million, a 9% lift in Kmart Group revenue to $5,441 million, and a 6.6% increase in Chemicals, Energy and Fertilisers revenue.

An improvement in its earnings before interest and tax (EBIT) margin from 11.3% to 12% led to half year EBIT growing 23.2% to $2,137 million.

On the bottom line, Wesfarmers delivered a 25.5% increase in net profit after tax (excluding significant items) to $1,414 million. Including significant items, net profit grew 23.3% to $1,390 million.

Also growing very strongly was the company’s free cash flow, which increased 89% over the prior corresponding period to $1,964 million.

This ultimately allowed the Wesfarmers board to declare a fully franked interim dividend of 88 cents per share. This is up 17.3% on last year’s interim dividend.

The company advised that this dividend takes into account available franking credits, its balance sheet position, credit metrics, and cash flow generation. It also preserves the flexibility to manage continued uncertainty associated with COVID-19, and to take advantage of value-accretive growth opportunities, if and when they arise.

What drove its strong growth?

Wesfarmers’ Managing Director, Rob Scott, revealed that its performance was driven by strong sales and earnings growth across its retail businesses. This was supported by an improvement in the performance of its Industrial and Safety businesses during a period of continued disruption and uncertainty.

Mr Scott said: “Bunnings, Kmart Group and Officeworks delivered strong trading results for the half, reflecting their ability to adapt to changing customer preferences and provide a safe environment for customers and team members.”

“In line with Wesfarmers’ objective of delivering superior and sustainable long-term returns, the retail divisions continued to invest in building deeper customer relationships and trust by providing greater value, service and convenience for customers during a period in which many Australian households faced significant challenges and uncertainty,” he added.

Mr Scott also revealed that the company experienced strong online sales growth during the half.

He explained: “Pleasing progress on the Group’s data and digital agenda in recent years supported strong online sales growth and digital engagement during the half. Total online sales across the Group more than doubled for the half, excluding Catch. Including the Catch marketplace, online sales of $2.0 billion were recorded for the half.”

How does this compare to expectations?

As I mentioned here last month, Goldman Sachs was forecasting revenue of $17,616.2 million and EBIT of $1,831.8 million.

Whereas Wesfarmers outperformed these forecasts with revenue of $17,774 million and EBIT of $2,137 million. 

So, with the Wesfarmers share price tumbling lower this morning, it appears as though some investors may be concerned with what’s to come in the second half.

Outlook

No guidance was given for the remainder of FY 2021, but management spoke positively about its outlook.

It said: “Economic conditions in Australia have recovered strongly and the outlook is more positive, subject to future COVID-19 risks. While the continued impact of COVID-19 on customer demand and operations presents significant uncertainty, the Group’s portfolio of cash-generative businesses with leading market positions remains well-placed to deliver satisfactory shareholder returns over the long term.”

Wesfarmers also revealed that retail sales have been strong during January and February.

However, as with Coles Group Ltd (ASX: COL), its growth is expected to moderate from March as it begins to cycle the initial sales surge caused by COVID-19.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Wesfarmers 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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Etherstack PLC (ASX: ESK) shares will be on watch today. This comes after the company announced it has signed a new deal with consumer electronics powerhouse, Samsung for integration activities.

At market close yesterday, shares in the communications wireless technology company finished the day at 63 cents.

Let’s take a closer look at the contract win that Etherstack reported.

What did Etherstack announce?

According to its release, Etherstack advised that its subsidiary, Etherstack Wireless Ltd, has entered a US$1.2 million contract agreement with Samsung.

In short, Etherstack stated the agreement will see it provide ‘a license to existing technology for the purposes of assisting the integration of the joint solution aimed at the telecommunications carrier market’.

The deal forms part of the Global Teaming Agreement that was previously announced in June last year.

Additionally, Etherstack noted that the signed deal does not include the sale of its solution to an end carrier.

Both companies are said to be working together on multiple carrier pursuits, with sales coming to fruition sometime this year. Moreover, Etherstack revealed that once the groundwork has been completed, these deals would require an additional licence and support revenues.

Quick take

Established in 1995, Etherstack designs develop and deploy wireless communications software and products across the globe. The company operates in the mission-critical radio technologies market.

Etherstack has offices in the United Kingdom, Australia, Japan, and the United States. The company services an array of sectors that include public safety, defence, utilities, transportation, and resources.

Share price snapshot

The Etherstack share price has accelerated over the last 12 months, rising to more than 240%. In late June, the company announced a Global Teaming Agreement with Samsung that pushed its shares to an all-time high of $3.70.

Consequently, since this announcement, the company’s shares have been hovering around the low 60-cent mark.

Based on the current share price, Etherstack has a market capitalisation of around $81 million.

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Motley Fool contributor Aaron Teboneras 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 Beacon Lighting Group Ltd (ASX: BLX) share price will be under the spotlight today after reporting a bright set of numbers.

Beacon is Australia’s biggest lighting retail business that has been operating for over 50 years. It sells lighting, ceiling fans and light globes. The company has 116 stores across the country.

Beacon Lighting’s shining FY21 half-year result

The lighting business reported that its sales increased by 23% to $151.3 million. The gross profit increased by 35% to $103.6 million thanks to the revenue growth and an increase of the gross profit margin of 6.1 percentage points to 68.5%. Less discounting helped support the gross margin.  

Company store comparable sales increased by 24.9% and online sales grew by 111.1% to $14.4 million. Beacon International sales increased by 45.2% to $5 million.

Beacon’s operating expenses only grew by 9.2% $56.7 million. This allowed earnings before interest, tax, depreciation and amortisation (EBITDA) to rise by 43% to $47.5 million. The EBITDA margin increased by 4.4 percentage points to 31.4%.

The earnings before interest and tax (EBIT) shot higher by 63.1% to $34.7 million, with the EBIT margin improving by 5.6 percentage points to 22.9%.

Net profit after tax (NPAT) growth was the brightest of all, increasing by 75% to $22.2 million. The NPAT margin improved 4.3 percentage points to 14.6%.

Using the underlying numbers, sales grew 23.5% and NPAT grew 132.8% to $22.2 million.

Beacon reported that its net operating cashflow rose by just over 120% to $38.7 million. This helped Beacon pay down $19.1 million in debt. It finished with a net cash position of $29.3 million. The company also invested $8.5 million in retail properties, with half of it being co-funded by non-controlling interests.

Since the end of FY20, the Beacon Lighting share price has risen by more than 70% (before the market opened).

Beacon Lighting dividend announcement

The Beacon board declared an interim fully franked dividend of 4.2 cents per share, which represents an increase of 61.5% compared to the prior corresponding period.

Outlook for the second half

Beacon revealed that it has bright prospects for the second half, with store sales continuing at an elevated level compared to the start of the second half of FY20.

It’s continuing to try to help its trade customers. Stores now open at 7:30am to allow trade customers to shop and new trade specific products are being developed and progressively released to stores. Beacon Lighting now has 39,800 ‘Trade Club’ customers. Trade Club sales increased by 50.8% in this result.

There will be further improvements to its websites. Beacon is also launching a new website to sell directly to consumers in the USA.

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Motley Fool contributor Tristan Harrison 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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Making a passive income has been made more difficult over recent months. An uncertain global economic outlook and low interest rates mean that there are potentially fewer options available to income-seeking investors. After all, some companies have cut their dividends, while other assets such as bonds and cash now have extremely low returns.

Despite this, it is possible to obtain a generous level of income from an investment in dividend shares. As such, now could be the right time to invest $20k, or any other amount, to obtain a growing income that is likely to be significantly higher than that available elsewhere.

A generous passive income

While the stock market has experienced a rally over recent months, a number of dividend shares continue to offer high yields. As such, it is possible to build a diverse portfolio of stocks that offers a high combined passive income for 2021.

On a relative basis, the income produced by shares this year is likely to be much higher than that available elsewhere. For example, other mainstream assets such as property have risen in price over the last decade. This may mean that yields across the sector have been squeezed at the same time as some stocks trade at low prices with high dividend yields.

Similarly, low interest rates mean that the income return on bonds and cash may be less than inflation in 2021 and in the coming years. This could further increase the appeal of dividend shares as a means to obtain a worthwhile passive income.

Dividend growth potential

As well as a generous income return in 2021, an investment in dividend shares could provide a growing passive income over the coming years. Certainly, a number of income stocks will fail to raise their dividends this year because of disruption caused by coronavirus and a weaker global economic performance. They may decide to hold cash in case there are further economic challenges or disruption caused by coronavirus ahead. However, history shows that this situation is unlikely to persist in the long run, and that an economic recovery is likely to take place.

This could allow dividend shares to raise their payouts at a fast pace that may be above inflation in many instances. This could further raise the profile of dividend stocks so they become popular among a broader range of investors. For example, a rapidly-rising dividend may suggest to growth investors that a company’s management team is optimistic about its prospects. This could increase demand for that company’s shares, and lead its stock price higher.

Therefore, dividend shares could offer capital growth alongside a worthwhile passive income today. This means that they could be worth buying instead of other assets to provide an income return on a $20k investment, or any other amount, over the coming years.

More reading

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Motley Fool contributor Peter Stephens 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 Sonic Healthcare Limited (ASX: SHL) could be poised to outperform the market today after it posted a more than doubling in net profit this morning.

But the big increase in profit and revenue isn’t the most exciting part of the result, although it will still be warmly welcomed by shareholders.

The medical diagnostic services group posted a 166% surge in first half net profit to $678 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 89% to $1.3 billion as revenue improved by a third to $4.4 billion.

Sonic share price gets COVID profit booster shot

The Sonic share price has been a COVID-19 winner as demand for COVID tests have hit the roof in all the countries it operates in.

Sonic undertook more than 18 million PCR tests to date in around 60 Sonic laboratories located around the world.

Demand for such tests is likely to persist for a while yet. Even as mass vaccinations are rolled out globally, testing is key to controlling the spread.

Other tailwinds behind Sonic’s share price  

But a bigger reason why I like its results is the operating leverage. Earnings have increased significantly ahead of revenue due to economies of scale.

Another exciting detail relates to its core business of testing and screening for non-COVID ailments. This part of the business took a big hit at the start of the pandemic due to social restrictions and patients fear of catching COVID at medical facilities.

“Our global base business revenue (excluding COVID testing) declined by 1% versus the comparative period, which was a very significant improvement versus the dramatic falls in base business we experienced from mid-March through May 2020,” said Sonic’s CEO, Dr Colin Goldschmidt.

“It appears our base business is becoming increasingly less affected by social restrictions and fear of infection, through better community understanding of the dangers in delaying or avoiding essential healthcare services.”

New growth opportunities

Sonic upped its interim dividend by 6%, or 2 cents, to 36 cents a share and the group’s gearing hit a record low. Sonic has $1.3 billion in liquidity before paying out the first half dividend.

That should still leave plenty in the tank to grow the business, and on that front, Sonic is striking an upbeat tone.

“Our management teams around the world are increasingly focussing on further growth opportunities, including acquisitions, contracts and joint ventures, supported by our very strong balance sheet,” added Goldschmidt.

“We are currently bidding on significant opportunities in Australia, the UK, the USA and Alberta, Canada.”

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Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. Connect with me on Twitter @brenlau.

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

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Santos Ltd (ASX: STO) shares will be in focus today after Australia’s second-largest oil and gas producer released its annual results this morning. By the market’s close on Wednesday, the Santos share price was fetching $7.04 after dropping by around 4% over the past month. 

Let’s take a look at what Santos reported.

Record annual production

The Santos share price will be on watch this morning after the company reported record annual production of 89 million barrels of oil equivalent (mmboe), up 18% on the year prior.

Despite this, the company still reported an annual net loss after taxes of US$357 million.

Santos advised that the net loss includes previously announced impairments primarily due to lower oil price assumptions. It further noted that both oil and LNG prices were significantly lower than the previous year due to coronavirus.

Sales revenue for the annual period dropped 16% from approximately US$4 billion in 2019 to around US$3.4 billion in 2020.

Santos generated US$740 million in free cash flow for the full year. This is 3.5 times greater than what was delivered in 2016 when oil prices were in a similar range.

The board resolved to pay a final dividend of US5 cents per share, fully franked. This is in line with the previous year’s final dividend and brings full-year dividends to US7.1 cents per share.

CEO commentary 

Reflecting on the annual results, Santos Managing Director and Chief Executive Officer Kevin Gallagher said:

2020 saw us ride through the bottom of the cycle while still generating free cash flow under a sustainable and disciplined operating model. As prices and demand recover, our projects are much better placed than those of our competitor countries. Living by our disciplined approach to cost and capital allocation, and remaining cash flow positive through 2020 means we are well positioned for further efficiency gains and growth initiatives in 2021.

He concluded that:

Our strongly cash-generative base business and diversified portfolio means that we are well positioned to drive free cash flow as commodity prices recover.

Santos share price snapshot

Over the past year, the Santos share price has fallen by around 13%. Santos shares fell as low as $2.73 during March 2020 before recovering to their current levels.

Based on the current Santos share price, the company has a market capitalisation of around $14.6 billion with 2.1 billion shares outstanding.

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Motley Fool contributor Gretchen Kennedy 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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