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Fortescue Metals Group Limited (ASX: FMG) shares could be impacted by the latest plans of Fortescue Future Industries (FFI).

While Fortescue may be best known as a large iron ore miner, it now has plans to turn itself into an integrated resources and green energy business. It’s aiming to take a global leadership position in green energy and technology and is committed to producing zero carbon green hydrogen.

While FFI has been working on a global portfolio of energy projects, the Australian Financial Review has reported on the potential latest project that could be closer to home — in Western Australia.

Wind farms for Esperance?

Fortescue Future Industries has reportedly signed exclusivity agreements with some farmers as it tries to gain access to land. It wants to build “hundreds” of wind turbines near Esperance and “turn the region into a green hydrogen hub”. Another part of the plan is looking for port sites near Esperance.

According to the AFR, if farmers agree to give FFI access to a portion of their land, they could receive annual fees of “$15,000 or more” per wind turbine. They will also get a “low-cost” supply of green ammonia to fertilise their land.

One of the people looking to make this happen is Maia Schweizer. She’s in charge of FFI’s work in Western Australia, South Australia, and the Northern Territory.

She said the company needs a new port so it can import construction materials and export green ammonia, and potentially green hydrogen.

The AFR quoted Schweizer, who said:

The short answer is we will almost certainly need a new facility somewhere along the coastline.

We’ve done a desktop review to identify some potential sites. That’s not a simple matter so now the real work begins of engaging with the local community and First Nations and finding a suitable location for that to happen.

How much will this cost?

One of the hurdles that Fortescue Future Industries may need to clear is the cost of this project.

The AFR reported that it could cost “tens of billions of dollars” to build the port, at least one desalination plant, an electrolyser, an ammonia production plant, and a network to connect all the wind turbines across all the farms involved.

Is there local interest in the plans?

Schweizer suggested that the project will need to be large enough to export to other markets. She thinks the reception from the community has been “really, really quite positive”.

There was feedback that farmers being able to diversify their revenue and reduce their carbon footprint in a decarbonised world market was “really promising”.

The AFR also quoted Karl Raszyk, who farms between Cascade and Scaddan.

Raszyk said:

I think most of the farmers are on the same page looking to reduce their emissions long-term and this project allows them to do that in a big way in the form of green fertiliser, or green ammonia.

One day we’d like to be able to sell green food like Andrew Forrest is trying to sell green steel.

The attraction of green ammonia for Raszyk is that it would provide nitrogen. This would replace fossil fuel-produced fertiliser, which makes up about 70% of the carbon footprint of the grain farms.

Fortescue share price snapshot

Since the beginning of 2022, Fortescue shares have fallen 3.7%.

The post Could the winds of change be blowing for Fortescue shares? appeared first on The Motley Fool Australia.

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More reading

• Is the Fortescue share price a buy going into the FY22 result?
• What’s with the Fortescue share price on Monday?
• Could this be set to boost ASX 200 iron ore shares?
• Why the Fortescue share price is on watch next week
• Worried about the iron ore price? Why the need for it ‘ain’t going anywhere’: broker

Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group Limited. 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 South32 Ltd (ASX: S32) share price is climbing after the miner’s FY22 results broke a few records and it declared a special dividend.

The diversified miner said its FY22 underlying earnings of US$2.6 billion and free cash flow from operations of US$2.6 billion were the highest they have ever been.

The US$139 million set aside for a special dividend, on top of the US$648 million for its final dividend, takes the total shareholder return to US$1.3 billion for FY22. This is also the most South32 has ever paid to shareholders.

The news sent the South32 share price jumping 4% to a high of $4.44 this morning, while the S&P/ASX 200 Index (ASX: XJO) is up 0.52% in morning trade.

Summary of South32’s FY22 results

• Group revenue jumped 69% in FY22 over FY21 to US$9.3 billion
• Statutory net profit after tax (NPAT) swung to US$2.7 billion (FY21 NPAT was a loss of US$195 million)
• Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) surged 156% to US$4.8 billion
• Underlying EBITDA margin increased to 47.1% in FY22 compared to 26.4% in FY21
• Ordinary dividends per share increased by 363% year over year (yoy) to US22.7 cents
• The special dividend was increased by 1 US cent yoy to 3 US cents per share.

Other highlights from South32’s FY22 results

It wasn’t only high commodity prices that helped South32 deliver the strong FY22 results. The miner also managed to increase production at several of its mines.

While some ASX mining shares were complaining of a margin squeeze due to higher prices, the double tailwind allowed South32 to expand its profit margin even though it was also dealing with the same price inflation issues.

Management also credited the change in its mining portfolio towards minerals needed for a low-carbon future for the good result. The transition gave South32 greater exposure to higher-margin businesses.

Meanwhile, its ability to navigate logistical bottlenecks to ship more of its commodities also helped.

What South32 said

The CEO of South32, Graham Kerr, said:

We achieved record production at Worsley Alumina, while Hillside Aluminium and Mozal Aluminium continued to test maximum technical capacity. At Cannington we exceeded production guidance as we transitioned to a new mine configuration.

Looking forward, we are well positioned to navigate the current economic uncertainty. We have a strong balance sheet with net cash of US$538 million after funding our new investments during the year, while our ongoing focus on cost management and an expected 14% increase in production will mitigate industry-wide cost inflation.

Outlook

South32 presented a positive outlook as it guided for increased FY23 output from most of its mines. This includes Worsley Alumina and Brazil Alumina, Hillside Aluminium, Sierra Gorda, Cannington, and Cerro Matoso.

The miner is also looking to further its cost-cutting exercise. It has so far clawed back US$50 million in annualised savings.

Shareholders will be hoping that South32 can beat its record-breaking FY22 results in the current year.

South32 share price snapshot

The South32 share price has been one of the better performing large-cap ASX mining shares. The shares have gained 44% over the past year when the ASX 200 fell 7%.

Other major miners are also struggling to keep up. The BHP Group Ltd (ASX: BHP) share price fell 8% while the OZ Minerals Limited (ASX: OZL) share price gained 14% over the same period.

The post South32 share price gains ground on record FY22 earnings and special dividend appeared first on The Motley Fool Australia.

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More reading

• These ASX 200 shares will trade ex-dividend tomorrow
• 5 things to watch on the ASX 200 on Thursday
• The Qantas factor: Rex shares hold steady despite deepening loss
• Could ASX 200 tech share Altium be in for another takeover approach?
• What’s been happening with the Nuix share price of late?

Motley Fool contributor Brendon Lau has positions in BHP Billiton Limited, OZ Minerals Limited, and South32 Ltd. 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 last few months has been a difficult period for the Newcrest Mining Ltd (ASX: NCM) share price.

After touching a 52-week high of $28.96 in April, the gold miner’s shares sunk to a multi-year low of $18.26 at market close yesterday. To put that into context, it represents a fall of more than 35% in the space of 4 months.

The company released its full-year results last Friday, climbing 3.64%, but provided little relief to shareholders.

At the time of writing, the Newcrest share price is trading at $18.35, down 1.45%.

While the share price has lost its shine, investors can look forward to the company’s dividend that was recently declared.

Here are all the details you need to know about the upcoming final dividend.

Newcrest shares near ex-dividend date

There could be a short-term boost for the Newcrest share price today as gold prices are currently up 0.32% to US$1,751 per ounce.

In addition, investors may look to secure the company’s latest dividend as the ex-dividend falls on Friday 26 August.

This means if you buy the gold miner’s shares today and hold them until tomorrow morning, you’ll be eligible for the dividend.

It is however worth pointing out that on Friday, Newcrest shares will likely fall in proportion to the dividend paid out. This is because investors who have locked in the dividend will quickly sell to gain a quick profit.

When can Newcrest shareholders expect payment?

If you’re going to collect Newcrest’s final dividend, you’ll receive a payment of 20 US cents per share on 29 September. That equates to around 29 Aussie cents, but the final amount will be determined on 30 August.

The dividend is fully franked.

In addition, it brings the total dividends paid out for the 2022 financial year to 27.5 US cents per share.

Newcrest’s policy is to target a total annual dividend payout of 30-60% of free cash flow generated for any financial year. Annual total dividends must be at least US 15 cents per share on a full year basis.

Newcrest share price snapshot

Since the start of 2022, the Newcrest share price has tanked 25% as the price of gold continues to retreat.

Newcrest commands a market capitalisation of approximately $16.38 billion and has a dividend yield of 3.58%.

The post Hoping to bag the next Newcrest dividend? Here’s what you need to do appeared first on The Motley Fool Australia.

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More reading

• These ASX 200 shares will trade ex-dividend tomorrow
• Can the gold price outshine sticky inflation?
• Why did the Newcrest share price just slump to a 6-year low?
• 5 things to watch on the ASX 200 on Monday
• Here are the top 10 ASX 200 shares today

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 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 of 1:30 p.m. ET, Helium (CRYPTO: HNT) had surged 8.1% higher over the past 24 hours. Interestingly, at today’s intraday high, this token surged nearly 15% over a 24-hour period, as momentum in this little-known crypto has picked up.

Currently No. 53 in the cryptocurrency rankings by market capitalisation, Helium is a decentralized blockchain project aimed at promoting integration between the Internet of Things (IoT) and the blockchain. It appears upcoming announcements tied to this project’s “HeliumHouse” event on Sept. 20 in New York is driving speculative investor interest in this token.

At this event, it’s expected Helium may provide community demos and various updates about the project’s roadmap and growth prospects.

So what

Helium’s focus on integrating blockchain technology with the high-growth area of IoT is compelling from a long-term perspective. There are many other competing projects in this space (Helium is far from the only project to be focusing on this utility-oriented end market). However, the potential for disruption in how people think about traditional communications infrastructure and the tracking and storage of data provides a relatively large potential market for investors to get excited about.

Helium’s upcoming event on Sept. 20 in New York could indeed outline some exciting new use cases and unveil intriguing opportunities this project is looking to tackle. However, with little in the way of any pre-released information about what will be announced, this catalyst appears to be more speculative than anything.

Now what

Helium’s significant outperformance today is noteworthy, as most tokens appear to be trading in a lower-volatility fashion today. With little news driving this token outside of potential catalysts on the horizon, perhaps today’s move is suspect. After all, some of the momentum this token saw earlier this morning has dissipated as of this afternoon’s session.

That said, Helium’s long-term prospects remain intriguing to many, as evidenced by today’s price action. This is a token I’ve put on my watch list, and will follow for any big updates in the weeks to come. Until then, investors may want to be careful trading tokens that can move so violently on relatively inconsequential catalysts.

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

The post Helium crypto soars as investors expect big announcements in September appeared first on The Motley Fool Australia.

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More reading

• Hoping to bag the next Newcrest dividend? Here’s what you need to do
• The CBA share price is down 4% in August. What’s going on?
• Analysts name 2 growing ASX shares as buys
• Woolworths share price on watch as sales leap 9% to $61 billion
• Appen share price on watch as interim dividend scrapped

Chris MacDonald 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.

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

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The Commonwealth Bank of Australia (ASX: CBA) share price is having a difficult time in August, having slipped almost 4% into the red since the start of the month.

The bank, valued at $165 billion by market capitalisation, took a turn for the worse this month. It reversed from previous highs of $102.60 on 8 August to rest at $97.20 before the open on Thursday.

This comes after it climbed 11% in July.

Meanwhile, the S&P/ASX 200 Financials Index (ASX: XFJ) is down around 2% this month, following a similar pattern to CBA on the chart, as seen below.

What’s up with the CBA share price?

ASX financial shares have taken a step backward in recent weeks following a number of macroeconomic uncertainties.

With the Reserve Bank of Australia (RBA) committed to tackling inflation through a series of interest rate hikes, debtholders will directly feel the impulse.

The prospect of higher interest rates has cast a dark cloud over the already saturated Australian mortgage market.

As a result, household and commercial mortgage payments are poised to increase. This comes with the prospect of higher default rates on these mortgages.

The Australian mortgage market is also very concentrated, with the 10 largest mortgage lenders comprising more than 91% of the entire market in 2021.

This combination of a crowded mortgage space along with tighter economic conditions looks to potentially compress bank net interest margins (NIMs).

Net interest margin is a key figure used to evaluate the profitability of banks. Typically, the higher, the better.

In its most recent earnings, CBA printed a NIM of 1.9%, down 18 basis points year on year, and down from 2.07% in 2020.

Furthermore, signs of a slowdown in Australian property have already begun to manifest.

Australian Bureau of Statistics (ABS) data from June revealed the purchase of business property slowed 12% year on year, while owner-occupier house purchases were down 9.6%.

Additionally, new loan commitments narrowed 26% year on year, whereas for first-time buyers, it was 32% lower versus the previous year.

As a result, the pressure is on the Australian mortgage market looking ahead.

What do the analysts think?

Turning to today’s performance and analyst sentiment on CBA is also fairly sour at present. The share has no buy ratings, and 10 out of 16 brokers covering it rate it as a sell right now, per Refinitiv Eikon data.

The remaining six brokers rate CBA as a hold. From this list, the consensus price target is $91 per share, suggesting there could be more downside to come if the group is correct.

At the time of writing, the CBA share price is down 0.05% on the day to $97.15.

In the past 12 months, CBA shares have slipped 3% into the red.

The post The CBA share price is down 4% in August. What’s going on? appeared first on The Motley Fool Australia.

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More reading

• Own CBA shares? $31b of the bank’s home loans face increasing climate risks
• How have ASX dividend shares been performing this earnings season?
• What’s moving the CBA share price this week?
• Why is the CBA share price sliding today?
• Is the CBA share price overvalued compared to other ASX 200 banks?

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 Scott Phillips.

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The price of lithium carbonate continues to be top-heavy in August, having curled upward in the past two weeks of trade.

From 17 August to date, the price of the key battery metal has caught a bid and gained 1.45% to A$102,690 per tonne.

Prior to this, lithium carbonate had remained steady since May, after a small dip in prices that saw the metal trade sideways, as seen below.

This market behaviour has been nothing but positive for the Lake Resources N.L (ASX: LKE) share price this past month, as seen in the above chart.

The little-known ASX lithium share has gained 75% in the past month of trade after a choppy period leading into the new financial year.

During August alone, it has traded in a range of 83 cents to $1.59, currently resting at $1.225 apiece.

Pricing looks positive for the industry

The earnings result this week from fellow lithium player Pilbara Minerals Ltd (ASX: PLS) also suggests that demand for lithium remains high.

Pilbara posted a 577% jump in annual revenue to $1.2 billion, citing demand for both its lithium and spodumene concentrate as reasons behind the increase.

Certainly, Pilbara Minerals is positioned further along the value chain than Lake Resources in that it already produces and sells lithium material.

However, heightened demand, based on several macroeconomic factors, could keep lithium prices top-heavy in the years to come.

For instance, “soaring demand drove expectations of extended supply deficits” in the 12 months to August, resulting in a 400% gain in prices, Trading Economics says:

On top of that, mid-year maintenance for producers drove carbonate output to contract 4% on the month to 30,320 tonnes during July.

In the US, demand for new energy vehicles is set to increase as the newly passed “Inflation Reduction Act” extends tax breaks for new electric vehicle purchases.

As such, ASX lithium shares like Lake Resources have strengthened and reclaimed a good chunk of losses suffered earlier in the year.

The Lake Resources share price is still up more than 105% for the past 12 months, of 21% this year to date.

The post Guess which little-known ASX lithium share has surged 75% in the past month appeared first on The Motley Fool Australia.

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More reading

• Could Pilbara’s inaugural profit signal good times ahead for ASX lithium shares?
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why is Lake Resources underperforming other ASX 200 lithium shares right now?
• These are the 10 most shorted ASX shares
• Here are the 3 most heavily traded ASX 200 shares on Friday

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 Scott Phillips.

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If you’re a fan of growth shares like I am, then you may want to hear what analysts are saying about the shares listed below.

Both have been named as buys and tipped to continue growing strongly for the foreseeable future. Here’s what they’re saying:

Breville Group Ltd (ASX: BRG)

The first ASX share that is growing strongly is leading appliance manufacturer, Breville.

Thanks to the popularity of its brands, its international expansion, and management’s ongoing investment in research and development, Breville has been growing its sales and earnings at a solid rate for a decade.

This continued in FY 2022, with the company reporting a 19.4% increase in revenue to a record of $1.42 billion and a 16.2% jump in net profit after tax to $105.7 million.

Goldman Sachs has become even more positive on the company following this results release. This is due to its exposure to some powerful trends and its strong brands. It said:

BRG reported in-line 2H22/FY22 results, with sales, EBIT and NPAT in-line with GSe and Factset Consensus. [..] Reiterate Buy on strong premium coffee in-home consumption trend and competitive advantage in premium brand and product.

Yesterday, the broker retained its buy rating and lifted its price target to $24.70.

TechnologyOne Ltd (ASX: TNE)

Another ASX share that is growing strongly is TechnologyOne.

It is an enterprise software provider to the government, local government, financial services, health & community services, education, and utilities and managed services markets.

Its software covers financials, HR & Payroll, supply chain, and business intelligence. In addition, the company offers custom software development services for large scale, purpose built applications.

Analysts at Bell Potter are very positive on the company thanks to its shift of focus. Instead of a licence model, the company is now focusing on a software-as-a-service model that generates recurring revenues from its customers.

Pleasingly, this shift is going well and Bell Potter expects this to continue to be the case and underpin further strong growth and margin expansion in the coming years. The broker commented:

The migration [to a fully integrated SaaS solution] is now around three quarters complete and Technology One is starting to reap the benefits of greater recurring revenue and a higher margin. This combination will in our view drive double digit earnings growth for years to come and, as the migration of customers approaches 100%, we expect the multiple to rerate to that of a pure SaaS company.

Bell Potter has a buy rating and and $14.25 price target on the company’s shares.

The post Analysts name 2 growing ASX shares as buys appeared first on The Motley Fool Australia.

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More reading

• Breville share price lifts on record FY22 revenue and dividend boost
• Why I would invest $10,000 into these ASX shares for 10 years
• Here are 2 exciting ASX growth shares tipped as buys by analysts
• Broker names 2 ASX growth shares to buy this week
• Here are 3 top ASX growth shares that experts are tipping as buys

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 TechnologyOne 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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The Woolworths Group Ltd (ASX: WOW) share price will be on watch this morning.

This comes after the company released its full-year results for the 2022 financial year.

At yesterday’s market close, shares in the retail giant finished 1.35% lower to $37.40.

Woolworths share price in focus following resilient financial performance

Woolworths has delivered its FY 2022 results for the 12 months ended 26 June 2022.

Here are some of the key financial highlights:

• Group sales up 9.2% to $60,849 million
• Earnings before interest and tax (EBIT) down 2.7% to $2,690 million
• Net profit after tax (NPAT) up 0.7% to $1,514 million
• Earnings per share (EPS) up 3.6% to 124 cents per share
• Final dividend of 53 cents per share, fully franked, bringing the full-year dividend to 92 cents per share, up 1.1%.

What happened in FY 2022?

Throughout FY 2022, Woolworths faced a number of difficult operating conditions across all facets of its businesses. This was related to COVID-19 supply chain disruptions, product shortages, team absenteeism, and flooding events along Australia’s east coast.

Despite the challenges, the group’s financial performance improved materially in the second half, led by its Australian food business. Total sales in this segment grew 4.5% to $45,461 million over the prior corresponding period (pcp).

Higher food inflation contributed to sales growth on the back of industry‐wide cost price increases. As COVID-19 restrictions eased, customers have been gradually returning to their normal spending habits.

The Australian B2B division recorded a bumper result with sales surging 224% to $3,963 million. This was underpinned by the acquisition of PFD as well as services revenue from Endeavour Group Ltd (ASX: EDV) following its demerger.

New Zealand food sales improved by 5.8% to NZD $7.6 billion as nationwide lockdowns in mid-August led to more in-home consumption.

Lastly, BIG W’s sales declined 3.3% to $4.4 billion due to an extended period of store closures in the first half and the impact of Omicron in the third quarter. Although, sales recovered strongly in the fourth quarter supported by Easter, Mother’s Day, and Toy Mania events.

What did management say?

Woolworths Group CEO Brad Banducci had this to say about the latest results:

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.

However, I am proud of how our team continued to show great care for our customers and each other and ongoing resilience to deliver a strong Christmas, and materially improved trading momentum in H2.

Importantly, we were also able to continue to progress our strategic and sustainability agendas and I am confident that, as we enter F23 with a renewed sense of purpose, we will be able to navigate ongoing uncertainties and challenges to deliver for all of our stakeholders.

What’s the outlook for FY 2023?

Looking ahead, Woolworths noted that FY 2023 remains uncertain as it continues to navigate through COVID-19.

The Australian food business has experienced a slight decline of 0.5% in total sales in the first eight weeks of FY 2023. Despite team absenteeism and supply chain disruptions improving, they continue to be above pre-COVID levels.

Furthermore, the New Zealand food division has also felt supply chain disruptions and team absenteeism. Total sales in the first eight weeks have declined 1% compared to the prior year.

On a positive note, BIG W total sales have been strong in the first eight weeks, increasing by just under 30%. This is being driven by increased customer mobility, strong execution, as well as cycling a sales decline of 15% in the prior year.

Banducci provided some insight for the new financial year, saying:

… 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. However, we are increasingly more agile and purposeful in responding to these challenges and are focused on improving our underlying operating performance across all aspects of our value chain after three years of disruption.

Woolworths share price snapshot

The Woolworths share price has dipped 2% in 2022, but is down 8% when looking over the past 12 months.

For context, the S&P/ASX 200 Consumer Staples (ASX: XSJ) sector is down 6% since this time last year.

Woolworths commands a market capitalisation of approximately $45.4 billion.

The post Woolworths share price on watch as sales leap 9% to $61 billion appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Thursday
• Earnings preview: Here are the ASX shares reporting today
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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 Scott Phillips.

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The Appen Ltd (ASX: APX) share price is in focus after the machine learning and artificial intelligence data provider released its earnings for the first half.

The Appen share price closed Wednesday’s session at $4.17.

Appen share price on watch as dividend ditched

Here are the key takeaways from the tech company’s earnings for the six months ended 30 June:

• Posted US$182.9 million of revenue – a 6.9% fall on that of the prior corresponding period (pcp)
• Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) before foreign exchange of US$9.6 million – a 66% fall
• Underlying EBITDA after foreign exchange came to US$8.5 million – a 69.3% tumble
• Recorded an after-tax loss of US$9.4 million for the period – representing a 240% fall
• Declined to pay an interim dividend

Appen’s global services division saw revenue fall 7% to US$137.8 million last half. Though, it won 99 new deals compared to the pcp’s 75 deals.

Its new markets division recorded US$45 million of revenue, a 6% drop, mainly due to its global product’s revenue falling 52% to US$10.6 million. Revenue from its non-global customers grew 35% to US$34.4 million.  

It’s worth noting the company was signing new and larger deals last half. Bookings in the period were up 9% and its average deal size increased 37% to US$91,000.

The company ended the half with US$42.2 million of cash and no debt.

What else happened in the first half?

The half year just been, saw Appen booted from the S&P/ASX 200 Index (ASX: XJO) and its share price plummet 50%.

The company also announced a strategic investment in the creator of Chameleon, Mindtech, in March.

What did management say?

Appen CEO Mark Brayan commented on the company’s earnings, saying:

Appen’s first half results have been impacted by external headwinds …. some of our global customers have cut costs and re-prioritised their spend which has impacted some of our large global programs.

We are highly focused on implementing our long-term strategy, including investments in new markets to diversify revenue. We are also reviewing all areas of the business to accelerate productivity improvements and prioritise near-term high impact change and tightly managed costs

While the current operating conditions remain challenging and some of our customers face numerous headwinds, we remain committed to our long-term strategy and confident of our prospects in the high growth AI market.

What’s next?

Appen didn’t provide new earnings guidance today. Though, it did note its revenue order book stands at around US$360 million, in line with that of August 2021, with customer delivery skewed to the December quarter.

It expects the second half to bring higher revenue but doesn’t think it will surpass that of prior years. Thus, its 2022 EBITDA and EBITDA margin is expected to be materially lower than those of 2021.

Appen share price snapshot

The Appen share price has tumbled 62.5% since the start of 2022. It has also dumped 70% since this time last year.

For comparison, the S&P/ASX All Technology Index(ASX: XTX) has slumped 28% year to date and 31% over the last 12 months.

The post Appen share price on watch as interim dividend scrapped appeared first on The Motley Fool Australia.

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• Earnings preview: Here are the ASX shares reporting today
• The Appen share price is down 20% in a month. Is it going lower?
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• Why Appen, Imugene, OZ Minerals, and Paradigm shares are charging higher
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Appen Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Allkem Ltd (ASX: AKE) share price will be a hot topic today after the company handed down its full-year results for FY22.

Shares in the multi-billion dollar lithium miner rallied 5.5% yesterday to $13.88. By the looks, investors were eager to load up ahead of earnings today.

All eyes on Allkem share price

• Record annual production from Mt Cattlin and Olaroz
• Group revenue up 9 times year on year to US$770 million
• Gross profit up 13 times to US$605 million
• Group net profit after tax (NPAT) up 4 times to US$337 million
• Cash and cash equivalents of US$664 million as at 30 June 2022, up 3 times

It is important to note, the incredible increases across most figures are primarily attributable to a change in the company. On 25 August 2021, Allkem (formerly Orocobre) merged with Galaxy Resources. Hence, this is the maiden full-year result as a combined entity.

What else happened in FY22?

The latest financial year was one of substantial growth and development for Allkem. Most notably, the integration of Galaxy Resources helped the company realise record production volumes and revenue.

According to the report, Mt Cattlin achieved 193,563 dry metric tonnes (dmt) of spodumene production. In addition, Allkem’s Olaroz project pumped out 12,863 tonnes of lithium carbonate.

Record production and sales were also bolstered by attractive lithium prices, boding well for the Allkem share price. For example, the company snagged an average price of US$2,221 per tonne for its spodumene at a gross cash margin of 80%.

Astonishingly, the average realised price for its lithium carbonate flew 370% higher to US423,398 per tonne.

On the development front, Allkem has made substantial progress in FY22. Some worthy mentions include:

• Olaroz stage 2 over 91% completion
• Naraha lithium hydroxide plant construction completed
• Construction at Sal de Vida commenced in January

These developments are expected to aid in Allkem’s endeavour to triple lithium production by 2026.

What did management say?

Commenting on the record results, Allkem managing director CEO Martin Perez de Solay said:

We achieved record revenue for the Group, not only from strengthened pricing but from successfully and safely producing high-quality lithium products from our global operations that have managed costs, improved safety performance and delivered record production during a period of supply chain disruption, labour shortage, high inflation and ongoing COVID-19 impacts.

Touching on the company’s developments Perez de Solay stated:

With two revenue-generating operations being supplemented by new operations in FY23 and a strong balance sheet, we are fully funded to complete construction at Sal de Vida and the development of James Bay.

What’s next?

Allkem provided a production guidance update in a separate release this morning. The company highlights the impacts of ongoing labour shortages as a reason for reviewing its FY23 production guidance.

As a result, consequential delays at Mt Cattlin have led to new guidance of 140,000 to 150,000 tonnes. For context, this compares to the previous 160,000 to 170,000 range. Furthermore, Allkem is in talks with customers to offload 100,000 tonnes of lower-grade spodumene at the moment.

Nevertheless, the company is forecasting a solid lithium market ahead.

Allkem share price snapshot

Allkem shareholders have revelled in the momentous boom in lithium recently.

Unsurprisingly, the Allkem share price has been no different. Since the start of the year, shares in the lithium producer have surged 24%. For reference, the S&P/ASX All Ordinaries Index (ASX: XAO) is 8.6% in the negative.

The post Allkem share price on watch amid a record year appeared first on The Motley Fool Australia.

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• Earnings preview: Here are the ASX shares reporting today
• Why is the Allkem share price charging 6% higher?
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• Why is the Allkem share price acing it on Tuesday?
• Leading brokers name 3 ASX shares to buy 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 Scott Phillips.

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