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Sentiment towards ASX tech shares has improved in recent months and Google’s deal with one of our tech minnows could help further.

The Ai-Media Technologies Ltd (ASX: AIM) share price is currently up 15.71% at 40.5 cents. In contrast, the S&P/ASX Small Ordinaries Index (ASX: XSO) is 1.03% in the red.

Deal between Google and this small ASX tech share

The small-cap ASX tech share jumped after it said it would become Google’s lead global provider of premium live captioning and translation services for internal meetings and events.

The three-year agreement is valued at up to US$5 million. All Google employees will have access to Ai-Media’s services.

But the ASX company warned that there is no guarantee that the contract will generate the full value of the agreement.

Strategic importance

It was quick to play up the “strategic importance” of the agreement between the ASX tech minnow and the global giant though.

Ai-Media’s chief executive Tony Abrahams said:

We are incredibly excited to be partnering with Google, one of the world’s leading technology companies, to improve the interconnectivity of its employees through our product offerings.

This is an important agreement for Ai-Media as it highlights our position as a trusted market leader, and it validates our ability to deliver high-quality and secure captioning services to a variety of global customers across different industries. Ai-Media is capitalising on the increasing demand for live captioning globally.

This agreement with Google demonstrates our product suite and technology is leading edge, and is expanding into more environments as video becomes a core communications tool for business.

ASX tech shares gaining traction

ASX tech shares have started to rebound following their brutal sell-off early this year. Deals like this show that there is value to be found as many of these shares are still nursing big losses.

In another boost to confidence, some ASX tech shares have started to attract takeover interest. These include the MOQ Ltd (ASX: MOQ) share price, and more recently, the Nearmap Ltd (ASX: NEA) share price.

Ai-Media share price snapshot

There seems like there may be a lot more room for the AI-Media share price to run. The shares have shed over 57% over the past year.

In contrast, the S&P/ASX All Technology Index (ASX: XTX) has fallen 27% over the same period.

The post Guess which ASX tech share is soaring 16% on a new Google deal appeared first on The Motley Fool Australia.

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More reading

• Considering Woolworths shares? Here’s why this key exec just jumped ship for Amazon
• Evolution Mining share price dives 4% on profit slump
• Down 16% in 3 days: Why is the Lake Resources share price still sliding?
• Not a risk taker? Here’s how that may cost you in retirement
• Sezzle share price soars 22% as BNPL company eyes profit target by year-end

Motley Fool contributor Brendon Lau has positions in Nearmap Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Nearmap Ltd. The Motley Fool Australia has positions in and has recommended Nearmap 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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Those invested in Woolworths Group Ltd (ASX: WOW) shares might be interested to learn one of the company’s executives is leaving their position for a leadership role at Amazon.

Woolworths managing director of B2B and Everyday Needs, Claire Peters, will take up a new position as vice president worldwide at Amazon Fresh, the retail giant’s grocery leg, next year.

Let’s take a closer look at the upper-management shakeup soon to be experienced by the S&P/ASX 200 Index (ASX: XJO) supermarket giant.

Woolworths shares are currently trading flat at $39.40 apiece.

Key Woolworths executive to step down

One of the top jobs at Woolworths is set to be vacated in 2023 after Peters agreed to pack up and move to Seattle for a leadership position at Amazon Fresh.

Peters has been with the Aussie supermarket operator since 2017, when she took up the role of managing director of Woolworths supermarkets. She was appointed to her current role in 2020.

Woolworths CEO Brad Banducci commented on Peters’ resignation, saying:

Claire has played a key role in transforming Woolworths Supermarkets and building the foundations of B2B and Everyday Needs.

In her five years with the company, Peters saw the transformation of Big W, the establishment of the company’s meat business Greenstock, and the progression of partnerships such as those with Endeavour Group Ltd (ASX: EDV), PFD Food Services, and Ampol Ltd (ASX: ALD).

Peters’ decision to jump ship may have come down to her prospective future at the supermarket giant, where she might not have been able to rise to the helm, a source reportedly suggested to the Australian Financial Review.

Banducci continued:

The biggest imprint Claire will leave on our business is her care for team and communities, on show in the leadership role she played during the repeated waves of COVID, and her purposeful work on reconciliation with the support of the First Nations Advisory Board.

Woolworths share price snapshot

It’s been a decent year so far for the Woolworths share price.

The ASX defensive stock has gained 2% since the start of 2022. Though, it’s currently trading 5% lower than it was this time last year.

For comparison, the ASX 200 has dumped 6% year to date and has fallen 5% over the last 12 months.

The post Considering Woolworths shares? Here’s why this key exec just jumped ship for Amazon appeared first on The Motley Fool Australia.

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More reading

• Brokers name 2 blue chip ASX 200 shares to buy
• Pact Group share price tumbles on 25% profit decline and halved dividends in FY22
• Up 15% in 2 months, is the Woolworths share price worth taking a bite?
• Woolworths share price slides following MyDeal ACCC nod
• Top ASX dividend shares to buy in August 2022

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. 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 Amazon. The Motley Fool Australia has recommended Amazon. 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 Evolution Mining Ltd (ASX: EVN) share price is in the red today after the company announced its preliminary results for FY22.

At the time of writing, the gold exploration company’s shares are trading for $2.58 each, down 4.09%. Earlier in today’s session, they were fetching a high of $2.65.

Let’s go over the highlights of the report.

What did Evolution Mining report?

• Statutory net profit after tax (NPAT) of $323.3 million, down 6% from $345.3 million in FY21
• Underlying NPAT of $274.7 million, down 22% year-on-year (YoY) from $354.3 million
• Total revenue up 11% YoY to $2.06 billion
• Earnings before interest, taxes, depreciation, and amortisation (EBITDA) down 2% YoY to $898.814 million
• Net mine cash flow down 49% YoY to $284.07 million
• Final fully franked dividend of 3 cents per share

The top line was affected by increased global gold and copper prices and volumes from the Ernest Henry mine.

Meanwhile, the company’s costs increased due to several factors, including acquisitions, input costs, and activities. These included $250 million in acquisitions for the Ernest Henry and Kundana mines in Queensland and Western Australia, respectively.

The company also notes that the increase in input prices resulted in a 4.9% increase in operating costs.

A fully franked final dividend of 3 cents per share was declared for a total payout to investors worth $55 million. The dividend will be paid on 30 September this year. This is the 19th consecutive dividend payment made to shareholders since 2013.

What else happened in FY22?

Evolution Mining acquired full ownership of the Ernest Henry copper-gold mine in FY22.

Some 104 million new fully paid ordinary shares were sold to institutional investors for $3.85 in July last year, raising $400 million.

A further share purchase plan was executed that year, raising roughly $68 million. The money raised will be used for general corporate spending.

Evolution mining also made headway in its progress towards its net-zero commitment. The business claims to have made a 7% improvement in emissions intensity.

What did management say?

Speaking on the FY22 results, Evolution Mining’s executive chairman Jake Klein said:

FY22 was a pivotal year for Evolution, with the portfolio transformed through the consolidation of the Mungari district, the acquisition of full ownership in Ernest Henry and the divestment of Mt Carlton. In addition to this, the progress achieved in the transformation of Red Lake and the execution of the Cowal Underground project have laid the foundations for a successful FY23 and beyond.

What’s next?

The company gave production guidance for FY23 and beyond. It’s expected to increase production by 12.5% to approximately 720,000 ounces in FY23, increasing 11% to 800,000 ounces the year after.

The company’s all-in sustaining cost (AISC) is expected to remain stable at $1,240 per ounce during FY23 and FY24.

Labour costs for next year are expected to increase by between 5% and 6%.

Evolution Mining share price snapshot

The Evolution Mining share price is down 36% year to date and 34% over the past 12 months. That’s significantly below the performance of the broader market, with the S&P/ASX 200 Index (ASX: XJO) down 6% and 5%, respectively, over those same timeframes.

The company’s market capitalisation is $2.73 billion.

The post Evolution Mining share price dives 4% on profit slump appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday
• Why is the Evolution share price up 13% in a month?
• 5 things to watch on the ASX 200 on Thursday

Motley Fool contributor Matthew Farley has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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It’s been another brutal day of trading so far this Thursday for the Lake Resources N.L. (ASX: LKE) share price. Lake Resources shares are currently down another 4.35% today to $1.21 a share, a vast underperformance of the S&P/ASX 200 Index (ASX: XJO).

Today’s slide is the third day of losses in a row for this ASX 200 lithium stock. The company has now lost a painful 16% since Monday’s session, including almost 6% just yesterday.

So what’s going on with the Lake Resources share price today?

Well, just like its falls earlier in the week, there’s no obvious explanation. The company hasn’t released any new news or announcements today. In fact, the last price-sensitive ASX release the company put out was the quarterly update from late last month.

But it is worth putting these recent falls in some wider context. Despite the horror week Lake has had this week, its share price remains up by a staggering 93.65% over the past month alone. So there has been a lot of ‘fallback room’ for investors, one could argue.

Additionally, this neck-cracking runup may have prompted the massive increase in short-seller interest we reported on Monday. As we covered at the time, short interest on Lake shares rose to 10.8%. This could have prompted some investors to pull their profits off the table too.

It’s probably a combination of these reasons that have led to Lake Resources shares’ not-so-good, very bad day today, and over this week more broadly. No doubt investors will be hoping for a gentler end to the trading week tomorrow.

At the current Lake Resources share price, this ASX 200 lithium stock has a market capitalisation of $1.7 billion.

The post Down 16% in 3 days: Why is the Lake Resources share price still sliding? appeared first on The Motley Fool Australia.

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• The ASX 200 share Firetrail just bought after brutal sell-off
• 5 things to watch on the ASX 200 on Thursday
• The A2 Milk share price has climbed 10% so far this month. What’s going on?

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

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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.

Saving up enough money for retirement without investing it at some point along the way is (to put it mildly) very difficult. Even if you had 50 years to save $1 million, you’d have to stash away $20,000 annually, and that’s not even considering the fact inflation will reduce the buying power of that $1 million over time. Consider this: $1 million in 2022 has about the same purchasing power as $150,000 did 50 years ago.

To ease your path to becoming financially comfortable in retirement, you should invest some of your money, specifically in stocks. They may be riskier than other investments like bonds or certificates of deposit (CDs), but that risk is more often than not worth the reward — especially if you’re investing long term in major indexes and blue chip companies.

Retirement likely won’t be cheap

It’s hard to say how much an individual might need in retirement, because it largely depends on location and lifestyle. But there is conventional wisdom you can use to give yourself a good starting point. The first step is applying the 80% rule, which recommends having at least 80% of your preretirement annual income in retirement to maintain your existing lifestyle. From there, apply the 4% rule, which will have you multiply that annual amount by 25 to receive a total savings estimate.

Following those rules, someone currently making $100,000 would need to save about $2 million. It may be all but impossible for most people to reach that amount just setting aside cash, but with time and compound interest, it’s more attainable than you may realize. For example, with 10% annual returns — the long-term average for the stock market — here’s roughly how much someone would need to invest monthly at different starting ages to reach $2 million by age 67 (the full Social Security retirement age for people born in 1960 or later):

• Age 25: $325
• Age 35: $850
• Age 45: $2,400

Growth is the priority when you’re younger

As you can see, the earlier you start, the lower your regular savings burden becomes. But in order for our example to play out, you also need a solid rate of return, and in order to achieve that, you should be willing to invest with a focus on growing your money. Yes, this means taking on more risk, but with a long-term plan, you also have time on your side to recover from down periods in the market. If you were in your 30s during the Great Recession, it likely didn’t break your retirement plans if you’ve stayed the course since then. However, if you were set to retire in 2008, you would need to adjust your strategy accordingly.

That’s why as you get older and near retirement, your investments should become more conservative with your focus gradually evolving from strong returns to preserving your portfolio. But if you start your investing journey focused on preservation, you run the risk of not having enough saved for retirement. Most bonds and fixed-income investments offer returns in the low single digits, and that’s oftentimes only enough to keep up with inflation.

Imagine if you invested $10,000 into the Vanguard Long-Term Corporate Bond ETF. Since its inception, that fund has delivered an approximately 5.5% average annual return to investors (which is in line with the long-term average for bonds overall). Assuming that average holds, your investment would be worth just under $50,000 after 30 years. Compare that to an equal investment in an S&P 500 index fund, where even a relatively conservative 7.5% average return would be worth almost $88,000 over the same holding period.

Of course, bonds carry far less risk (although some bond issuers do default), while stocks for even the biggest companies can see wild swings. But for anyone still relatively early in their savings journey, you’re likely to regret missing the opportunity to accelerate your progress toward your retirement goals with some stocks that can boost the long-term growth of your portfolio.

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

The post Not a risk taker? Here’s how that may cost you in retirement appeared first on The Motley Fool Australia.

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More reading

• Evolution Mining share price dives 4% on profit slump
• Down 16% in 3 days: Why is the Lake Resources share price still sliding?
• Sezzle share price soars 22% as BNPL company eyes profit target by year-end
• Pro Medicus share price fails to fly on 44% profit leap
• Qantas share price dips as ACCC raises acquisition concerns

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 Sezzle Inc (ASX: SXL) share price is surging today after a business update from the company.

Sezzle shares are currently trading 17% higher at 85 cents after touching an intraday high of 93 cents apiece this morning. In contrast, the S&P/ASX 200 Index (ASX: XJO) is down 0.27% at the time of writing.

So what did the ASX buy now, pay later (BNPL) share report to the market?

July update

Key points of Sezzle’s July business update include:

• Underlying merchant sales (UMS) surged 9.5% on the previous month to US$141.2 million
• Total income lifted 4% on the previous month to US$10.2 million
• 64,000 subscribers to Sezzle Premium as at 16 August 2022
• July cash burn fell to US$1.8 million

Sezzle’s UMS growth was driven by more volume in the Sezzle Premium program and long-term value-boosting 100% month on month.

Total income as a percentage of UMS lifted higher than 7%. The company said this came about due to higher uptake of Sezzle Premium, offboarding unprofitable merchants and renegotiating merchant and network partner contracts.

Sezzle highlighted a range of measures expected to deliver US$40 million revenue and cost savings every year. The BNPL company said these initiatives were helping to drive the company towards profit and free cash flow.

They include reducing the workforce, ending payment processing in India, lowering third-party spend and scaling back Brazil and Europe efforts. Sezzle also launched the premium subscription product.

In addition, Sezzle is planning to launch a “convenience fee” for US customers using a debit or credit card for instalment payments. This will be fully launched towards the end of the fourth quarter.

Management comment

Commenting on the July update, Sezzle chairman and CEO Charlie Youakim predicted Sezzle could be profitable by the end of the year.

July’s results demonstrate the progress and success of our initiatives in Sezzle’s evolution
to be a profitable and positive free cash flow business by year end.

We understand the impact these initiatives have on growth, so teams are moving expeditiously to achieve profitability before refocusing efforts back to growth

Sezzle share price snapshot

It’s been a challenging year for the Sezzle share price, which has lost 72% since January and fell to a 52-week low of 19 cents in July.

Sezzle shares have clawed back some losses over the past month, however, to lift a hefty 329% over that timeframe.

Sezzle has a market capitalisation of about $170 million based on the current share price.

The post Sezzle share price soars 22% as BNPL company eyes profit target by year-end appeared first on The Motley Fool Australia.

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More reading

• Sezzle share price tumbles 11% as losses deepen
• Why is the Zip share price tumbling 6% on Tuesday?
• Why is the Sezzle share price surging 8% on Wednesday?
• Friend or foe? Could inflation give ASX BNPL shares a new lease on life?
• Sizzle, fizzle, pop! What’s with the Sezzle share price on Monday?

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 Pro Medicus Limited (ASX: PME) share price is splashing about to little avail on Thursday as investors react to the company’s full-year results for FY22.

Around midday, shares in the medical imaging software provider are sporting a slight 0.5% increase. The Pro Medicus share price is now $54.04. For context, the S&P/ASX 200 Index (ASX: XJO) is down 0.22%.

Pro Medicus share price staggers on solid result

Key highlights in the report are as follows:

• Revenue up 37.7% year over year to $93.5 million
• Earnings before interest and tax (EBIT) margin of 67.5%, up from 63%
• Net profit after tax (NPAT) up 44.1% to $44.4 million
• Fully franked final dividend of 12 cents per share declared
• Total dividends for FY22 up 47% to 22 cents per share fully franked
• Cash and other financial assets increased 47% to $90.6 million.

ASX investors are largely unamused by the news released by Pro Medicus today. Despite the results representing another record for revenue and profits, shares are staggering above and below yesterday’s closing price.

What else happened in FY22?

It was a busy financial year for the team at Pro Medicus in FY22. The 12-month period consisted of a mix between new deal signings and significant contract renewals.

Noteworthy new deals involved prominent healthcare providers including Novant Health, Inova Health, and Allina Health. All three of these contracts with the United States-based operators were for seven or eight years. The combined value over the life of the initial agreements amounts to $100 million.

Meanwhile, key renewals during the reporting period included those with Sutter Health and Wellspan. Pleasingly, the agreed term was for an additional five years at a combined value of $47 million.

Moreover, Pro Medicus landed its fourth extension for the provision of its Visage 7.0 platform to the German Government.

What did management say?

Commenting on the results, Pro Medicus CEO Dr Sam Hubert said:

FY22 year was another year where all our key financial metrics headed in the right direction and we continued to make significant progress with key implementations. All three jurisdictions did very well. North America – our biggest market – was the key contributor, with a 65% jump in transaction revenue coupled with three new material contracts and two contract renewals.

Additionally, Hubert highlighted that revenue from recent contract wins — such as Novant, Inova, and Allina Health — will begin in FY23.

What’s next?

Becoming a somewhat common theme this earnings season, Pro Medicus did not provide any forward guidance. Although, Dr Hubert did note that the company’s contract pipeline remains ‘strong’.

The CEO also noted that interest from the for-profit sector has picked up again after dropping off from COVID-19 impacts.

Finally, management pointed out the possibility of future merger and acquisition opportunities amid compressed company valuations. Namely, potential in artificial intelligence (AI) startups that are pre-revenue and not profitable.

With more than $90 million of financial fodder on its balance sheet, Pro Medicus would be primed for any such activity.

Pro Medicus share price snapshot

As with most premium-valued companies, 2022 has been relatively unkind to the Pro Medicus share price. The shares have fallen around 14% since the beginning of the year. Whereas, the S&P/ASX 200 Health Care Index (ASX: XHJ) has only tip-toed 4.4% lower.

Lastly, despite the sizeable boost in earnings, Pro Medicus still trades on a price-to-earnings (P/E) ratio of approximately 127 times. For comparison, the average for the global healthcare services industry is 40.6 times.

The post Pro Medicus share price fails to fly on 44% profit leap appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Buy and hold this ‘incredibly undervalued’ ASX share for 4 years: fundie
• Here are the top 10 ASX shares today
• Why has the Pro Medicus share price surged 32% in a month?

Motley Fool contributor Mitchell Lawler has positions in Pro Medicus Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Pro Medicus Ltd. The Motley Fool Australia has positions in and has recommended Pro Medicus 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 Qantas Airways Limited (ASX: QAN) share price is in negative territory on Thursday.

This comes after the competition watchdog signalled its concerns about Qantas’ monopoly in the domestic travel market.

At the time of writing, the airline operator’s shares are down 0.62% to $4.79.

ACCC outlines preliminary competition concerns

In today’s release, Qantas informed the market of the latest saga regarding its proposed acquisition of Alliance Aviation Services Ltd (ASX: AQZ).

The statement of issues published by the Australian Competition & Consumer Commission (ACCC), expressed concerns about the Qantas merger and how it will negatively impact competition.

Qantas and Alliance provide air transport services to regional and remote areas across the country. This includes operating routes for mining and resource companies that need to transport ‘fly-in fly-out’ workers.

If the acquisition goes ahead, it would mean that Qantas would control two of the top three air transport services in Queensland and Western Australia.

For example, Alliance is the only competitor to Qantas on the Brisbane-Moranbah regional passenger transport route.

As industry participants have expressed strong concerns, the ACCC is considering the level of competition provided by other airlines. Virgin and Cobham’s regional services arm, which was recently purchased by Regional Express Holdings Ltd (ASX: REX) also operate regional and remote routes.

ACCC chair, Gina Cass-Gottlieb said:

Our preliminary view is that there are already significant barriers for airlines who want to enter or expand their operations in regional and remote areas, including access to pilots, airport facilities and infrastructure, and associated regulatory approvals.

… A competitive and well-functioning aviation sector is fundamental to the Australian economy.

Furthermore, the ACCC is also looking into how the removal of Alliance’s aircraft leasing services would affect the other competitors.

Alliance is a key supplier of wet-leased medium-sized aircraft to other airlines. Wet-leases are arrangements where an airline leases a plane, crew, and other related services from another airline or business.

Despite the update, investors appear to have largely shrugged off the news with the Qantas share price travelling slightly lower.

On the other hand, the Alliance Aviation share price is down 3.66% to $3.42 apiece.

Qantas share price snapshot

Since the start of 2022, Qantas shares have travelled on a rollercoaster, posting a loss of around 5%.

However, when looking at a larger time frame such as the last 12 months, its shares are up 8.5%.

Qantas commands a market capitalisation of approximately $9 billion, making it the 59th largest company on the ASX.

The post Qantas share price dips as ACCC raises acquisition concerns 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 recommended Alliance Aviation Services 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 IPH Ltd (ASX: IPH) share price is on fire today.

Shares in the intellectual property services group leapt 17% higher in early morning trade and are currently up 13.8% since yesterday’s close.

The big gain in the IPH share price comes with two drivers: the release of its full year results for the 2022 financial year (FY22); and an acquisition announcement.

First, the acquisition…

IPH share price takes off on acquisition news

Investors are bidding up the IPH share price after the company announced it’s reached an agreement to acquire the IP agency practice of Smart & Biggar, a leading Canadian intellectual property firm.

This marks the first expansion for IPH beyond the Asia Pacific region.

The consideration for the acquisition is CA$348 million (AU$387 million).

That’s comprised of an upfront cash consideration of CA$241 million along with an initial issue of 5.3 million new IPH shares with a value of CA$41 million (escrowed for two years). There’s also a deferred issue of new IPH shares (earn-out consideration) up to a value of CA$66 million (also escrowed for two years).

IPH forecast underlying earnings per share (EPS) accretion of around 10% in the first full year of ownership.

Commenting on the acquisition that looks to be driving the IPH share price higher today, CEO Andrew Blattman said:

The Australian and Canadian IP markets are very similar, and together the combined group will be well positioned to provide our clients with a comprehensive IP service offering with an international reach in key secondary markets, while offering strong career development opportunities for our people.

Moving on to the IPH FY22 results…

What happened in FY22?

• Revenue of $385.1 million, up 6% from the prior year
• Statutory net profit after tax (NPAT) of $52.6 million, down 2% year on year
• Statutory earnings before interest, taxes, depreciation and amortisation (EBITDA) of $115.9 million, up 2% from FY21
• Final dividend of 16.0 cents per share, 50% franked, an increase of 3% from FY22

What else impacted the IPH share price during the year?

The IPH results were significantly stronger on an underlying basis, likely providing some extra tailwinds for the share price today.

The company reported a 14% increase in underlying NPAT to $86.7 million while underlying EBITDA increased 11% from FY22 to $137.4 million.

It attributed the large difference between underlying and statutory results to the $4.6 million non-cash write-down of the intangible value of the Shelston IP brand, alongside the $2.2 million write-down of the Practice Insight business, which was divested during the year.

The company forecast that both these initiatives will deliver higher earnings in FY23 and beyond.

The full-year dividend comes out to 30.5 cents per share, up from 29.5 cents per share in FY21.

What did management say?

Commenting on the full-year results, Blattman said:

Since listing we have successfully demonstrated how our strategy to combine organic growth with the acquisition and integration of businesses delivers earnings accretion for the wider group. Our FY22 result reflects the continuation of that strategy with our Asian business once again delivering double-digit revenue and earnings growth on a like-for-like basis…

In Singapore, IPH Group maintained our number one patent market share of 21.9% for the period ending 31 March 2022… IPH remains the market leader in Australia with combined group patent market share (excluding innovation patents) of 34% for the year to 30 June 2022.

IPH share price snapshot

The IPH share price is up 21% over the past 12 months, handily outpacing the 5% full-year loss posted by the All Ordinaries Index (ASX: XAO).

Longer-term, IPH shares are up 123% over the past five years.

The post IPH share price just rocketed 17% on results and acquisition news appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended IPH Ltd. The Motley Fool Australia has recommended IPH 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 HomeCo Daily Needs REIT (ASX: HDN) share price is in the red today despite the company reporting a massive rise in profit for the 2022 financial year (FY22) this morning.

Shares of the real estate investment trust (REIT) are currently trading for $1.28 each, a fall of 3.03% on Wednesday’s closing price.

HomeCo describes itself as a property company that invests in convenience-based assets across target sub-sectors of neighbourhood retail, large format retail, and health and services.

Let’s go over the key metrics of its financial report.

What did HomeCo report?

Highlights from HomeCo’s FY22 results include:

• Revenue from ordinary activities up 338.7% year-on-year (YoY) to $198.3 million
• Profit from ordinary activities up 970.6% YoY to $335.1 million
• Earnings before interest, taxes, depreciation, and amortisation (EBITDA) up 368.65% YoY to $125.6 million
• Funds from operations (FFO) up 30% YoY to $105.6 million or 8.85 cash distribution per unit (CPU)
• Distribution per unit (DPU) of 8.28 CPU, up 18% YoY

HomeCo said its growth in earnings is reflected in its recent acquisitions and developments, as well as the merger with Aventus, which it completed in March this year.

The Aventus merger will reportedly unlock $500 million for its property pipeline in the future.

The company made six acquisitions in 2022 worth $2.64 billion.

With the new acquisitions and mergers, HomeCo has a $4.6 billion property portfolio. The portfolio reportedly performs strongly with a 99% occupancy and 99% cash collection in FY22.

What else happened in FY22?

The merger with Aventus and acquisitions saw net assets increase in FY22 by 165.21% to $3.137 billion.

HomeCo joined the S&P/ASX 200 Index (ASX: XJO) in April 2022.

The company also updated investors on its environmental, social, and governance (ESG) policies, with a net-zero emissions target for FY28.

What did management say?

Commenting on the FY22 results, HomeCo Chair Simon Shakesheff said:

Today’s result builds on HDN’s strong track record since listing in November 2020 … The transformational merger with Aventus has been successfully integrated and the management team has maintained strong operational momentum with over 99% occupancy and 99% rent collection in FY22.

The management team is capitalising on HDN’s enhanced portfolio scale to drive rental growth in a higher inflation and interest rate environment as demonstrated by positive leasing spreads of +5.7% and comparable NOI growth of +5.1%.

How did Homeco’s performance compare with expectations?

HomeCo reported that it either met or exceeded previous guidance estimates across its key financial metrics.

The company’s FFO of 8.85CPU exceeded the guidance of 8.8CPU. Its DPU was also in line with expectations.

What’s next?

HomeCo gave guidance for the rest of this year. The company expects an 8.6CPU with a DPU guidance of 8.3 cents. The expected DPU reflects a 97% payout ratio.

Moving forward, the company will focus on its development pipeline that’s helped by a 30.6% pro forma gearing, which is at the bottom of its 30% to 40% target gearing range.

Some $75 million worth of developments is expected to be delivered in FY23 with a 7% return on invested capital (ROIC).

HomeCo share price snapshot

The HomeCo share price is currently down 17.5% year to date.

Meanwhile, the S&P/ASX 200 A-REIT Index (ASX: XPJ) is down 19% over the same period.

HomeCo has a market capitalisation of $2.73 billion. 

The post HomeCo share price slides despite 970% profit boost appeared first on The Motley Fool Australia.

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Motley Fool contributor Matthew Farley has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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