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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

Shares of electric car maker Tesla (NASDAQ: TSLA) were trading sharply higher on Tuesday. The growth stock rose as much as 2.4%. While the stock lost some of these gains later in the day, shares were still up nearly 2% as of 12:50 p.m. ET.

The stock’s gain is likely due to trading bets and hype surrounding the company’s planned stock split this week. Tesla shares are splitting on a 3-for-1 basis. The stock will start trading on a split-adjusted basis on Thursday, Aug. 25.

So what

Tesla stock has had a rough year, sliding about 16% year to date. But the stock’s year-to-date return would have been much worse if it wasn’t for a sharp recovery over the last three months. During this period, the stock is up more than 30%. This compares to a 6% gain for the S&P 500.

While the stock’s move higher on Tuesday may be due in part to traders making bets on the stock in anticipation of a potential bump higher this week as the company executes its stock split, part of the optimism may also be a continuation of Tesla’s upward trend over the last three months.

Now what

Whatever the main reasons for the stock’s nice uptick on Tuesday, investors should stay focused on the electric car maker’s fundamentals. After all, it’s impossible to know how the stock will trade throughout the week as Tesla shares are split anyway.

Tesla’s second-quarter vehicle deliveries fell sequentially as the company dealt with the ramifications of Shanghai government restrictions on factories in the region as the Chinese market implemented strict procedures to stop the spread of COVID-19. But despite a sequential decline, deliveries still grew 27% year over year in Q2. Even more, management said it finished up the quarter with strong production rates, setting up the company for higher production levels in Q3 and potentially even a higher year-over-year growth rate in deliveries. 

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

The post Tesla stock is rising ahead of its stock split appeared first on The Motley Fool Australia.

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• 3 things you should know about the Tesla stock split
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Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Tesla. 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 Reece Ltd (ASX: REH) share price is lifting during the early hours of trading on Wednesday following the release of its FY22 results. At the time of writing, the Reece share price is up 3.59%, trading at $15.74.

The company actually posted its earnings after market hours yesterday, leaving investors to digest the news overnight and into this morning.

Reece share price lifts alongside revenue, profit

Key takeouts from the company’s 12 months include:

• Sales revenue up 22% year on year to $7.65 billion for the year
• Adjusted EBITDA up 16% from the previous year to $838 million
• Net profit after tax (NPAT) climbed another 37% to $392 million from last year’s $286 million
• Earnings per share (EPS) growth of 37% surmounting to 61 cents per share
• Fully franked final dividend of 15 cents per share, up 25%

What else happened for Reece last period?

There was growth from top-to-bottom throughout Reece’s income statement for FY22. Revenue jumped 22% whilst NPAT followed suit with a 37% year-on-year gain.

In its Australia and New Zealand operations, sales revenue increased by 12% to $3.5 billion, up from $3.15 billion in FY21.

Meanwhile, Reece also continued its initiatives to bring the Reece brand into the US market, growing its footprint to 204 stores and refurbishing another 11 stores during the year. 

With the 37% gain in EPS, the board was able to authorise a final dividend of 15 cents per share, recorded on 12 October, payable on 26 October 2022.

Management commentary

Speaking on the results, Reece Group CEO, Peter Wilson said:

We have navigated another year of disruption and change in FY22 to deliver a very strong result, demonstrating the resilience of our business. Despite being hit by ongoing challenges, the team successfully navigated the ongoing pandemic, supply chain constraints and natural disasters to continue delivering for our customers, who were busier than ever.

Looking ahead, we believe we are past the peak of the cycle in our end markets and are prepared for
softening conditions. The macro setting is complex and will require careful management, but Reece has a strong track record of managing and investing to improve its business through the cycle.

Reece share price snapshot

In the last 12 months, the Reece share price is down more than 36% or 41% this year to date.

Despite its struggles, it has continued to gain over 8% in the past single month of trade.

The post Reece share price spikes 4% despite ‘year of disruption’ 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 Scott Phillips.

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The Hansen Technologies Limited (ASX: HSN) share price is tumbling following the release of the company’s full-year earnings.

The $1 billion All Ordinaries Index (ASX: XAO) energy, water, and communications-focused software and services provider’s stock opened 1.8% lower at $5.55 and has continued to dive.

Right now, the Hansen share price is $5.24, 7.26% lower than its previous close.

Hansen share price tumbles on full-year earnings

Here are the key takeaways from the ASX tech company’s financial year 2022 (FY22) results:

• Revenue came in at $296.5 million – down 4% on that of the prior corresponding period (pcp)
• Statutory net profit after tax (NPAT) slumped 27% to $41.9 million
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) fell 16% to $99.9 million
• Basic earnings per share (EPS) of 29 cents – a 21% fall
• Declared 5 cent, 30% franked final dividend, bringing its full-year payout to a record 12 cents

While its results might look discouraging, they are significantly brighter when adjusted for a prepaid licence received from Telefonica in FY21 that generated $21 million of revenue.

Such adjustments see Hansen’s revenue lifting 3.4% year-on-year and its EBITDA rising 1.7%. Meanwhile, its NPAT is suddenly 7.4% higher while its basis EPS has risen 5.4%.

The company’s free cash flow also exceeded $63 million in FY22. It used that to pay down borrowings, fund dividends, and build reserves.

What else happened in FY22?

The major news from Hansen’s camp last financial year was of a proposed takeover offer put to the company by BHG Capital.

The firm posted a $6.50 per share bid for the tech stock in June 2021 before withdrawing the offer in September. The Hansen share price sunk 9% on the back of the retraction.

What did management say?

Hansen CEO Andrew Hansen commented on the company’s earnings, saying:

Despite all the headwinds of the past 12 months, I am incredibly proud that Hansen continues to build on its more than 50 years of sustainable, profitable, and cash-generative growth.

The FY22 result reinforces the long-term resilience of our business – a business where we consistently put our customers and our people at our heart to deliver mission-critical software solutions to the essential sectors of society.

What’s next?

The company plans to continue working towards strategic growth in its existing markets and opportunities to expand into other markets. Hansen said:

We are confident in our people, in the strength of our growing talent pool spread across the world, and in the investment that we have made in our global sales and mergers and acquisition teams, which combined will see continued organic and inorganic growth delivered to our shareholders over time.

Hansen Technologies share price snapshot

Today’s fall has plunged the Hansen Technologies share price into the long-term red.

It’s currently trading 2% lower than it was at the start of 2022. It has also fallen 13% since this time last year.

For comparison, the All Ordinaries Index has dumped 9% year to date and 6% over the last 12 months.

The post Hansen Technologies share price plunges 7% despite record dividend appeared first on The Motley Fool Australia.

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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 Hansen Technologies. 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 Iluka Resources Ltd (ASX: ILU) share price is rocketing after the company released its half-year earnings results today.

The company’s share price is currently swapping hands at $10.07, a 6.56% gain. In comparison, the  S&P/ASX 200 Index (ASX: XJO) is up 0.65% at the time of writing.

Let’s take a look at what the ASX mineral explorer reported to the market.

Iluka delivers 186% profit boost

Highlights of Iluka’s H122 financial presentation for the six months to 30 June 2022 include:

• Net profit after tax (NPAT) soared 185.7% on H121 to $368.5 million
• Underlying group earnings before interest, tax, depreciation and amortisation (EBITDA) lifted 70.5% to $525.5 million
• Net total cash increased to $600.3 million
• Free cash flow of $349.8 million
• Interim fully franked dividend more than doubled to 25 cents per share.

What else did the company report?

Iluka advised that mineral sands revenue lifted 29.8% to $954.9 million, and EBITDA surged 68.9% to $505.4 million. The EBITDA margin for mineral sands lifted from 40.7% in H121 to 52.9% in H122.

The company said the revenue boost reflected high prices spanning all of its products. Zircon prices lifted 40%, while rutile prices soared 23%. The lower US dollar also had a positive impact on Iluka’s revenue.

Iluka’s interim dividend soared 108.3%, from 12 cents per share in H121 to 25 cents per share in H122.

The company completed the demerger of Sierra Rutile in the first half of 2022. The explorer also made a final investment decision on the Eneabba rare earths refinery in Western Australia.

Management comment

Commenting on the results, Iluka managing director Tom O’Leary said:

Iluka delivered strong outcomes in the first half, both in terms of financial performance and progress on our strategic priorities.

In a macroeconomic environment characterised by inflation and uncertainty, we increased margins and strengthened our balance sheet. This was the result of strong demand for Iluka’s products, industry supply constraints and resultant pricing traction.

What’s ahead?

Iluka said demand for its products remained strong and supply was tight. European tile production was robust, while Chinese tile production faced challenges in the property market along with COVID-19 restrictions. The company added that demand from the ceramics industry in Brazil and Mexico was higher, and foundry and fused zirconia demand remained elevated in the United States.

Iluka’s zircon sales for the third quarter of the calendar year 2022 are fully contracted amid tight supplies.

Iluka highlighted only minimal spot volumes of its high-grade titanium feedstocks were up for grabs in the second half of FY22. Demand is high in North America, with supply security a priority for customers amid the Ukraine war and other global challenges.

Iluka said there was strong customer interest in its remaining uncontracted tonnages from 2023.

O’Leary said Iluka was “well placed” as customers prioritise security of supply. Looking ahead, he added:

Our Australian operations are configured at maximum settings and sales over the second half are likely to continue to be constrained by production. Furthermore, the second half will see first production from the restart of Synthetic Rutile Kiln 1 at Capel.

Other approaching development milestones include the commencement of ground works for the Eneabba rare earths refinery; the completion of the definitive feasibility study for the Balranald project; and the completion of preliminary feasibility studies for the Wimmera and Atacama project

Iluka share price snapshot

The Iluka share price has surged more than 13% in the past 12 months, while it has gained 1.4% in the year to date. Iluka shares have climbed 4.5% in the past month.

Iluka has a market capitalisation of more than $4.2 billion based on the current share price.

The post Iluka share price leaps 6% following monster dividend appeared first on The Motley Fool Australia.

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Motley Fool contributor Monica O’Shea 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 Tabcorp Holdings Ltd (ASX: TAH) share price is climbing today following the release of the company’s full-year results.

At the time of writing, the gambling company’s shares are up 5.43% to 97 cents.

Let’s take a look at the results in more detail.

Tabcorp share price up on financial discipline and strong balance sheet

Tabcorp delivered its FY 2022 results for the 12 months ended 30 June 2022. Here are some of the key financial highlights:

• Group revenue down 4.3% to $2,373 million
• Group earnings before interest, tax, depreciation and amortisation (EBITDA) from continuing operations of $381.6 million, down 21.7%
• Statutory net profit after tax (NPAT) of $6,775.9 million, includes gain on demerger of $6,513.8 million (FY 2021: $269.4 million)
• Final dividend of 6.5 cents per share, fully franked, bringing the full-year dividend to 13 cents per share, down 10.3%
• Strong balance sheet with net debt of $20 million excluding lease liabilities and significantly restricted cash

What happened in FY 2022?

In FY 2022, Tabcorp’s wagering and media divisions recorded $2,182 million in revenue, down 5.1% year on year. Both businesses were significantly impacted by COVID-19-related retail closures in the first half, particularly in New South Wales and Victoria.

Furthermore, a record number of horse racing abandonments was experienced due to wet weather in the second half.

On a positive note, the re-opening of venues from the second quarter showed promising signs of recovery for the remainder of the year.

Across the gaming services division, revenue for the year was up 5.3% to $193 million. Max venue services attributed $119.3 million in revenue, up 20% from FY 2021. On the other hand, max regulatory services fell 12.2% to $73.6 million due to COVID-19 closures in New South Wales.

The board announced a fully franked final dividend of 6.5 cents per share. The latest dividend reflects five months of earnings from the demerged Lotteries and Keno business, and a full six months of earnings from Tabcorp’s continuing businesses.

What did management say?

Tabcorp managing director and CEO, Adam Rytenskild commented:

FY22 was a disrupted year with first half COVID lockdowns in our two largest markets, a record number of race meetings washed out and the priority challenges of a company pre-demerger. We are seeing stabilisation in our digital market share, and our total focus is now on executing our strategy to transform and pursue growth. We feel the next results, reflecting this half, will be a good test for the improvements we are making.

What’s the outlook for FY 2023?

Tabcorp advised that it’s determined to grow the business and make it more competitive in the market in FY 2023.

For the first month of the financial year (July), digital revenue market share jumped to 25%.

In addition, group revenue increased by 14.6%, and wagering and media revenue lifted by 11.2% compared to the prior corresponding period.

Tabcorp is focused on launching the new TAB app in September, ahead of the major spring racing carnivals. So far, customers who have trialled the app have delivered positive feedback.

The Queensland structural reform to an operator agnostic, sustainable funding structure remains on track. That means Tabcorp will pay the same wagering taxes and fees as Northern Territory licenced operators.

Following the company’s cost and efficiency program, management is targeting 3% to 4% cost growth on FY 2022 pro forma.

FY 2023 capital expenditure is forecast to be up to $150 million, with depreciation and amortisation of between $250 million and $260 million.

Tabcorp share price snapshot

Since the beginning of 2022, the Tabcorp share price has largely moved in circles to gain 1.5% for the period.

For context, the S&P/ASX 200 Consumer Discretionary (ASX: XDJ) sector is down 18% year to date.

Tabcorp commands a market capitalisation of approximately $2.15 billion.

The post Tabcorp share price rises 5% as management focuses on ‘pursuing growth’ appeared first on The Motley Fool Australia.

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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 Propel Funeral Partners Ltd (ASX: PFP) share price is on the move this morning following the release of the company’s FY22 full-year results.

At the time of writing, the Propel share price is fetching $4.92 apiece, already down 0.41% from the open.

Propel secures another record performance

Key takeouts from the company’s FY22 include:

• Revenue of $145.2 million, up 20.6% on the prior year
• Adjusted operating EBITDA of $39 million, up 25.2% year on year
• Adjusted operating net profit after tax (NPAT) of $16.9 million, up 45.0% on the prior year
• Adjusted NPAT of $16 million, up 53% from the previous year
• Full franked total dividend of 12.25 cents per share (cps) – final dividend of 6.25cps

What else happened for Propel last period?

The company recognised a record year in terms of its financial performance. Funeral volumes increased by 18% from the previous year, backed by a 2% increase in average revenue per funeral.

It also booked revenue from 6 acquisitions that were completed during the financial year, seeing an impact on revenue shortly following their completion.

In addition, it saw a full year of income contribution from 3 acquisitions that were completed back in FY21.

The Propel board also authorised a fully franked final dividend of 6.25cps, representing a payout ratio of approximately 81% from NPAT.

Management commentary

Speaking on the results, both Propel’s chairman and managing director, Brian Scullin and Albin Kurti commented:

During FY22, the funeral industry continued to experience operational disruptions (including increased absenteeism) due to COVID-19. However, the Company’s diversification in providing essential funeral and related services across seven States and Territories of Australia and in New Zealand, including regional and metropolitan markets, delivered considerable resilience in earnings and operating cash flow.

What’s next for Propel?

The company has started the new financial year well and notes that in the first 6 weeks of FY23, “total and comparable funeral volumes were materially higher than [last year]”.

Moreover, it said that during July, average revenue per funeral was up 6% versus July last year, whilst operating EBITDA margin “reflected strong seasonal trading conditions”.

In the last 12 months, the Propel share price is up more than 43%, having clipped a 11% gain this year to date.

The post Propel Funeral Partners share price dips despite ‘another record year’ 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 recommended Propel Funeral Partners Ltd. 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 Coles Group Limited (ASX: COL) share price is down almost 5% to $17.78 in early Wednesday trading after the supermarket and liquor group reported full-year sales up 2% to $39.4 billion and net profits after tax up 4% to $1.05 billion.

The company declared a fully-franked final dividend of 30 cents per share, taking total FY22 dividends to 63 cents per share, an increase of 3.3% compared to FY21.

The Coles final dividend will be paid to eligible shareholders on 28th September 2022. Coles shares go ex-dividend on 2nd September 2022. 

Based on the Coles share price of $18, the stock trades at 23 times earnings and on a fully-franked dividend yield of 3.5%.

Looking ahead, like many retailers, Coles faces a number of challenges, including further cost price inflation, COVID-19 and flu staff absenteeism, and rising interest rates placing pressure on many households. 

Coles declined to give a specific outlook, saying it will continue to focus on delivering trusted value to customers. 

Over the past 12 months, Coles shares are flat, compared to a fall of 7.6% in the ASX 200 Index. By contrast, the Woolworths (ASX:WOW) share price has fallen 8% in the last year.

The post Coles shares trade on fully-franked yield of 3.5% after reporting higher profits appeared first on The Motley Fool Australia.

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Motley Fool contributor Bruce Jackson 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 positions in and has recommended COLESGROUP DEF SET. 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 Seven Group Holdings Ltd (ASX: SVW) share price will be squarely in the view of many investors on Wednesday amid the release of the company’s full-year results.

At the time of writing, shares in the diversified investment holdings group are trading 1.64% higher to $17.99.

Seven Group share price gains amid mixed year

• Revenue from continuing operations up 65.6% year on year to $8,013.4 million
• Underlying EBITDA up 39.2% to $1,465 million
• Group statutory net profit after tax (NPAT) down 4.3% to $607.4 million
• Final fully-franked dividend of 23 cents per share declared
• Statutory earnings per share (EPS) down 16.3% to $1.54
• Cash and cash equivalents of $1,254.6 million at 30 June 2022

What else happened in FY22?

It might be a challenge for investors to decipher whether this was a positive result for Seven Group or not. While the company experienced a drastic increase in revenue compared to the prior year, the bottom line took a beating on a statutory basis.

Peering into the individual business units under the Seven Group umbrella might give us a better understanding of what happened.

According to the report, Seven’s energy segment delivered the largest percentage increase on an earnings before interest and tax (EBIT) basis. This was thanks to the company’s holding in Beach Energy Ltd (ASX: BPT), which benefitted from the uptick in demand for domestic gas — possibly providing momentum for the Seven Group share price today.

In contrast, Seven Group’s holding in Boral Limited (ASX: BLD) was the largest anchor to earnings. The construction materials supplier experienced margin pressure amid construction lockdowns and rising energy costs.

Finally, both Coates Hire and WesTrac delivered solid earnings growth, up 16.3% and 6.3% respectively. The two segments constitute the two largest earnings contributors of Seven Group.

What did management say?

Seven Group managing director and CEO Ryan Stokes highlighted the importance of the company’s diversified structure today. Commenting on the full-year result, Stokes said:

Today’s result reflects the strength of our diversified group structure, delivering strong earnings growth across the majority of our businesses. The WesTrac and Coates results were particularly pleasing. Boral performance will be a focus for improvement and FY23 will see particular attention on pricing and margin discipline. Boral is expected to deliver earnings uplift and progress towards restoring appropriate profitability to an Iconic Australian company.

Additionally, Stokes noted that the group is making progress on simplifying the Boral business.

What’s next?

Turning to what may lie ahead for Seven Group, management described several potential tailwinds.

For WesTrac, an ageing mining fleet was mentioned as a likely growth driver in FY23. Meanwhile, Coates Hire and Boral are expected to capture a boost from a substantial infrastructure and construction pipeline.

Consequently, the group is eyeing high single- to low double-digit underlying EBIT growth on top of FY22.

Seven Group share price snapshot

Although the diversified nature of the business may have protected its bottom line, the same can’t be said for the Seven Group share price.

In the last 12 months, the share price has been chipped away to the tune of 21.37%. For comparison, the S&P/ASX 200 Index (ASX: XJO) is down a less disappointing 6.7%.

However, the valuation erosion has brought the group’s price-to-earnings (P/E) ratio to 10.6 times. This is roughly in line with the current industry average.

The post Seven Group share price lights up as revenue rips 65% higher appeared first on The Motley Fool Australia.

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

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The AUB Group Ltd (ASX: AUB) share price is outpacing the market after it posted a double-digit increase in full-year earnings.

The insurance broking group reported a 13.3% uplift in FY22 underlying net profit to $65.3 million compared to a year ago.

The increase would be a more impressive 22.2% from a “continuing operations” basis. This excludes Job Keeper payments and the sale of the Altius business, which bolstered its FY21 profit numbers.

The AUB share price added 3.23% in morning trade to $21.12 while the All Ordinaries (ASX: XAO) inched up 0.4%.

Summary of AUB’s FY22 results

• Underlying earnings per share (EPS) of 96.70 cents per share:
  • up 12.3% on FY21 underlying EPS of 86.12 cents
  • up 21.1% on FY21 underlying EPS from continuing operations of 79.85 cents
• Reported Net Profit After Tax (NPAT) of $80.8mn (FY21: $70.6mn), up 14.5%
• Fully franked final dividend of 38.0 cents per share (FY21: 39.0 cps), down 2.6% taking FY22 total dividend to 55.0 cents per share (FY21: 55.0 cps)

What is driving AUB’s FY22 growth

The group attributed profit growth to strong organic growth in Australian Broking and Agencies. Australian Broking enjoyed an increase in commercial lines premiums and the number of clients and policies.

Ongoing cost reductions from merging some of its businesses also helped. But this was partially offset by higher wages and increased cost of corporate insurances.

AUB’s Agencies division recorded a 53.5% increase in underlying pre-tax profit to $22.8 million. The increase is due to strong organic growth and the full-year contribution from 360 Underwriting Solutions.

Its BizCover business also contributed to group profits as the platform gained scale, but its New Zealand expansion detracted due to additional technology investments the group had to make in FY22.

What AUB said about its full-year results

AUB Group managing director, Michael Emmett, said:

FY22 has been a challenging year for our partners and clients with the ongoing COVID-19 pandemic, major flooding events in Australia and uncertain geopolitical and macroeconomic environments.

Despite the challenges, I’m pleased to report another strong operational and financial result for FY22, a reflection of the efforts and support our brokers and teams provide to our clients.

Outlook and guidance

AUB noted that its growth momentum is carrying through into the first half of FY23. It expects to deliver FY23 underlying NPAT in the range of $86 million to $91 million. This would represent a gain of 16.2% to 23% versus FY22.

The results might even be better than guidance as management is not counting contribution from its Tyser acquisition.

AUB share price snapshot

Despite the good FY22 result, the AUB share price has shed 15% of its value over the past year. In contrast, the All Ordinaries (ASX: XAO) has lost 7% of its value.

The AUB share price is also lagging other ASX insurers. The Suncorp Group Ltd (ASX: SUN) share price is down 13% while the QBE Insurance Group Ltd (ASX: QBE) share price is flat over the period.

The post AUB share price outperforms on double-digit NPAT growth in FY22 appeared first on The Motley Fool Australia.

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Motley Fool contributor Brendon Lau 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 Austbrokers Holdings 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 Elmo Software Ltd (ASX: ELO) share price has climbed higher after it reported its full-year results and provided its outlook.

The ASX technology stock surged 5.6% to a $3 high in early trade on Wednesday and has since retreated to now trade at $2.95, up 3.8%.

What did the company report?

• Revenue was up 32% to hit $91.4 million
• Annualised recurring revenue was up 29% compared to 30 June 2021
• Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) hit $7.1 million, up from $600,000
• Net loss after tax attributable to equity owners was up 110% at $79 million

What else happened in FY22?

Aside from the launch of new modules for its software suite, the major corporate event for the human resources software provider was speculation that it was to be acquired.

In June, Elmo Software confirmed that it “conducted exploratory discussions” about a non-binding takeover proposal priced at $6.10 per share.

Those negotiations concluded without action, according to the Elmo board.

What did management say?

Elmo Software chief executive Danny Lessem said:

I’m extremely pleased with ELMO’s FY22 results. Our group organic growth accelerated as small and medium sized businesses continue to adopt cloud-based solutions to manage an increasingly flexible or hybrid workforce.

We have seen an improvement in our operating metrics across both mid-market and small business segments. A reduction in churn and an improved GP margin resulted in a substantial increase in the lifetime value of our customer base to $1.1 billion. This is a 75% increase on FY21.

What’s next?

Unlike many ASX companies this reporting season, Elmo Software has provided some guidance for the 2023 financial year:

• Annualised recurring revenue to grow 24% to 29% ($134 million to $140 million)
• Revenue to grow 25% to 31% ($114 million to $120 million)
• EBITDA to approximately triple to a range of $20 million to $25 million
• Operating cash flow to end up between negative $2 million and positive $2 million

According to Lessem, “increased operational efficiencies” from scale would see the business reach breakeven for operational cash flow during the current financial year.

“Our strong brand in the markets we operate, our many years of investment into our product and the increased adoption of people management software, have ensured that we have strong momentum going into FY23,” he said.

“Despite the broader macroeconomic environment, this momentum is supported by our sales pipeline which underpins our FY23 guidance.”

Elmo share price snapshot

Like most technology stocks, the Elmo share price has been on a wild ride in 2022.

From November to July, it lost more than 60%. It has since rallied to be 34.7% down year-to-date.

The market capitalisation sits at around $263 million.

The post Elmo share price surges after 32% revenue boost appeared first on The Motley Fool Australia.

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More reading

• Buy this ASX tech share with 170% upside: expert
• Elmo share price soars on 30% revenue boost and optimistic FY23 guidance

Motley Fool contributor Tony Yoo has positions in Elmo Software. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Elmo Software. The Motley Fool Australia has positions in and has recommended Elmo Software. 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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