Tag: Motley Fool

The AMA Group Ltd (ASX: AMA) share price has fought back from the red after the company released its earnings for the first half of financial year 2022.

At the time of writing, the AMA Group share price is 35 cents, the same as yesterday’s close. This morning, the company’s shares hit a high of 36.5 cents each before dipping into the red then settling at 35 cents apiece.

Here are the highlights of the automotive aftercare and accessories company’s 1H FY22 results:

AMA Group share price slips as profits tumble

• Revenue $418.1 million ­­– down from $435.1 million in the first half of financial year 2021
• Earnings before interest, tax, depreciation, amortisation, impairment, and fair value adjustments for continuing operations (EBITDAI) of around $2.8 million – down from $55.7 million
• Operating loss before tax of $52.4 million – down from a $7 million profit
• Total loss of $48 million – down from a $4.6 million profit
• No dividend declared

The first half of financial year 2022 has hit the automotive repair service provider hard.

In fact, it saw the lowest number of repairs completed in a six month period since the onset of the pandemic due to COVID-19-induced lockdowns, restrictions, and a resulting drop in vehicle use.

According to the company, fewer repairs dinted its revenue last half while its raw material costs increased.

Additionally, its employee benefits expenses grew in the first half of financial year 2022, mainly due to the end of JobKeeper assistance.

For context, the company received $28.4 million of JobKeeper in the first half of financial year 2021.

It also reported a $16.7 million non-cash impairment expense, mostly related to its hibernation and consolidation of sites.

However, AMA Group’s balance sheet is looking strong.

The company ended the half with a cash balance of $81.3 million, $8.2 million of undrawn debt facilities, and $307.6 million of net assets.

It has also paid off $175 million of debt since mid-2020, leaving it with debts of just $165 million.

The company says this leaves it in a good position to continue battling the ongoing COVID-19 impacts.

What else happened in the half?

The company’s vehicle collision segment brought in $357.5 million of revenue last half – down from $380.3 million in the first half of financial year 2021.

Its heavy motor segment’s revenue increased to $27.8 million – up from $25.4 million.

The company’s supply leg’s revenue grew around $2.5 million to approximately $42.7 million. It also began to evolve its strategy to create an integrated parts supply chain for the collision repair industry.

Meanwhile, its corporate and eliminations segment recorded a $9.9 million loss. Though, that’s better than the prior comparable period’s $10.7 million loss.

The company also underwent a capital raise during the half. AMA Group raised around $53 million through an institutional entitlement offer where its shares were offered at a price of 37.5 cents apiece.

A retail entitlement offer raised another $46 million at the same offer price.

Finally, the company placed $50 million of subordinated notes.

Most of the capital raised went towards paying off the company’s debt.

What did management say?

AMA Group CEO and managing director Carl Bizon commented on the company’s outlook, saying:

Repair volume challenges are situational, not structural. We are well placed to weather the ongoing effects of COVID and are actively tackling the industry’s parts and labour supply issues.

The continued downtrend in COVID-19 cases leaves me optimistic about return to historical repair volumes.

What’s next?

The company is expecting its vehicle collision repair segment to recover as vehicle use normalises post-COVID.

It’s ready to hit the ground running with its workforce mostly intact despite the competitive labour market.  

Additionally, the company’s heavy motor segment’s future performance looks good. Its forward workbook has continuously remained strong.

However, the company’s supply business has lost a complete vehicle wreck insurer agreement that brought revenue of $6 million. However, its recycling business is still going strong and its parallel import performance has improved.

The supply chain segment’s new procurement business is expected to bring around $10 million of annual benefits, identified and in place for 2022.

The company is also targeting several acquisitions in collision repair and associated industries.

Additionally, AMA Group took on 71 new apprentices in January 2022. Apprentices now represent 10% of its workforce while skilled visa holders represent another 8%.

Thus, the company is expecting the reopening of Australia’s borders to positively impact its workforce as it looks to hire from the international talent pool.

Looking to the company’s performance for early 2022, its repair volumes are slowly recovering after the summer holidays.

However, COVID-19 is still challenging its business, with customers delaying superficial repairs.

There has also been an increase in customers not turning up for appointments due to being in isolation.

Staff absenteeism also increased to between 15% and 20% in January.

AMA Group share price snapshot

2022 has been rough on the AMA Group share price.

It has fallen around 20% since the start of this year. It’s also currently 50% lower than it was this time last year.

The post Down but not out: AMA Group (ASX:AMA) share price holds amid CEO’s optimism appeared first on The Motley Fool Australia.

More reading

• The Westpac (ASX:WBC) share price has gained less than $4 in 10 years. Have the dividends been worth it?
• Jumbo (ASX:JIN) share price down 10% as first half margins get crunched
• Here’s why the IAG (ASX:IAG) share price is outperforming today
• Own Zip (ASX:Z1P) shares? Rumours are circulating the company may be set for a capital raise
• AGL gets an offer and Australians return to the skies. Scott Phillips on Nine’s Late News

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

from The Motley Fool Australia https://ift.tt/hKa4zF0

58.4%. That’s how much the Westpac Banking Corp (ASX: WBC) share price has appreciated since late March of 2020 and today. For investors who have held Westpac shares since early 2020, this ASX 200 bank has been a reasonably well-performing investment. Heck, Westpac shares are even up close to 9% in 2022 so far, handily outperforming the S&P/ASX 200 Index (ASX: XJO).

So it might come as a surprise for many investors to hear that Westpac has been an exceptionally unimpressive investment over the past 10 years. As you can see on the chart below:

Yes, roughly a decade ago, the Westpac share price was sitting at $20.52. Today, it’s at $23.56 at the time of writing, down 1.22% for the day so far. That’s a 10-year gain of 14.8%. Not exactly ‘set-the-world-on-fire’ stuff. In contrast, the ASX 200 is up approximately 66.1% over the same period. So Westpac has been a clear market laggard over the past decade.

But, as most investors would know, Westpac shares are often held purely for the dividends they generate. So let’s see if the dividends of the past decade have made an investment in Westpac worth it.

Can Westpac’s dividends make up for its poor share price performance?

So since February 2012, Westpac has paid out a total of $16.16 in dividends per share.

Let’s now assume that an investor bought $10,000 worth of Westpac shares back in February 2012. At the price named above, that would have resulted in the owner receiving 487 shares, with some change left over.

Today, those 487 shares would be worth roughly $11,473.70. But this shareholder would have also enjoyed an approximate $7,870 in dividend income over that time as well. That would have boosted the shareholder’s total return to around $19,343.70. That equates to a 10-year return of 93.44%, or an annual average of 6.82%.

So yes, Westpac’s dividends have had a meaningful impact on its shareholders’ total returns over the past 10 years. Throw in franking credits and the returns would be even higher. So the vast majority of Westpac’s total returns have come from dividends, perhaps as you would expect from an ASX 200 banking share.

That’s still not quite in the same league as the returns an ASX 200 index fund would have given an investor. For example, the iShares Core S&P/ASX 200 ETF (ASX: IOZ) has returned 142.5% in total, or an average of 9.26% per annum over the past decade (as of 31 January) when you account for dividend distributions.

But even so, it certainly puts Westpac’s laggardly share price performance over this period in a far rosier light.

At the current Westpac share price, this ASX 200 bank has a market capitalisation of $85 billion, with a trailing dividend yield of 5.1%.

The post The Westpac (ASX:WBC) share price has gained less than $4 in 10 years. Have the dividends been worth it? appeared first on The Motley Fool Australia.

More reading

• The Bank of Queensland (ASX:BOQ) share price has leapt 10% in 3 weeks. How does this compare to the other big banks?
• Morgans names 2 ASX 200 dividend shares to buy now
• This expert says the Westpac (ASX:WBC) share price has 25% upside
• Why ‘dependable and reliable dividend payers’ could be the antidote to current volatility: expert
• These 3 ASX 200 shares are topping the volume charts this Tuesday

Fetching Disclosure…

from The Motley Fool Australia https://ift.tt/tEh8nTP

The Jumbo Interactive Ltd (ASX: JIN) share price is under pressure on Tuesday morning. This follows the release of the lottery ticket seller’s half year results.

At the time of writing, the Jumbo share price is down 10% to $16.36.

Jumbo share price falls

• Total transaction value (TTV) up 41% to $327.9 million
• Revenue up 29% to $52.8 million
• Underlying EBITDA up 18% to $28.3 million
• Underlying net profit after tax (NPAT) up 18% to $16.5 million
• Fully franked interim dividend up 22% to 22 cents per share

What happened during the first half?

For the six months ended 31 December, Jumbo reported a 41% increase in TTV to $327.9 million and a 29% lift in revenue to $52.8 million.

A key driver of this top line growth was an increase in jackpots greater than or equal to $15 million during the first half. There were 23 of these jackpots during the period, compared to 15 in the prior corresponding period.

This was supported by its Powered by Jumbo software business, which doubled its TTV on a reported basis, and its Managed Services operations, which are led by its Gatherwell business, which reported 56% TTV growth during the half.

One slight disappointment was that this strong top line growth didn’t fully flow through to the bottom line. Jumbo’s underlying EBITDA margin reduced by 5.3 percentage points to 53.7%. This reflects an increase in Tabcorp Holdings Limited (ASX: TAH) service fees, higher marketing expenses, and a rise in employee expenses to support its growth.

This led to underlying EBITDA growth of 18.2% to $28.3 million and underlying NPAT growth of 18.2% to $16.5 million. Judging by the Jumbo share price reaction, this appears to have fallen short of expectations.

Management commentary

Jumbo’s CEO and Founder, Mike Veverka, was pleased with the half.

He said “We are very pleased with the growth that we have achieved this half, across all our operating segments, and the positive momentum across the business. Lottery Retailing continues to perform exceptionally well, underpinned by the improved jackpot cycle and our focus on player engagement and retention. Our SaaS and Managed Services segments continue to demonstrate good organic growth, with all our Australian SaaS clients contributing on a full run-rate basis.”

“We are successfully executing on our strategy and planning is underway to ensure we efficiently and effectively integrate the Stride and StarVale acquisitions post completion. The global lottery industry is in the midst of a digital change and our Powered By Jumbo software platform will be key to supporting lotteries through this change. Our balance sheet remains strong and when combined with our new debt facility, provides additional headroom for further strategic growth.”

No guidance or commentary has been given for the second half, which could be weighing a touch on the Jumbo share price this morning.

The post Jumbo (ASX:JIN) share price down 10% as first half margins get crunched appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• Why Beach, Jumbo, Premier Investments, and Western Areas are pushing higher
• Jumbo Interactive (ASX:JIN) share price leaps 6% on acquisition announcement

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

from The Motley Fool Australia https://ift.tt/LlA42pj

The Insurance Australia Group Ltd (ASX: IAG) share price is in the green today, up 0.4% to $4.84 per share.

While that’s no huge leap, it comes as the S&P/ASX 200 Index (ASX: XJO) is under renewed pressure, currently down 0.9%.

So why is the IAG share price outperforming?

Business interruption court case appeal

This morning the ASX 200 insurance giant reported on the outcome of the second business interruption test case appeal.

The judgment from the Full Court of the Federal Court of Australia was handed down yesterday.

Investors are rewarding the IAG share price after the court “substantially agreed with the conclusions” reached by the Federal Court of Australia on 8 October 2021. That ruling came out in favour of insurers on most policy wording questions surrounding the coverage of business interruption, particularly relating to pandemic issues.

At the time, the Insurance Council of Australia stated that the insurance industry has “long maintained that pandemics are not intended to be covered under most business interruption policies.”

In yesterday’s judgement the Full Court did reverse two elements of the IAG v Meridian Travel case judgment. According to the release, it ruled that “JobKeeper payments are not to be taken into account in the assessment of loss, and interest payments are to be calculated on a different basis”.

IAG said it will review the judgment to “determine whether to seek leave to appeal any aspect of the judgment”. Parties in the case have 28 days to do so.

The insurance giant said there won’t be any adjustment to its $1.22 billion provision for potential business interruption claims. It added that “as the legal position becomes more certain and claims experience emerges, IAG will refine the prediction of ultimate claim costs and adjust its provision accordingly”.

IAG share price snapshot

The IAG share price has been a strong performer in 2022, up 8.7%. That compares to a year-to-date loss of 5.5% posted by the ASX 200.

The post Here’s why the IAG (ASX:IAG) share price is outperforming today appeared first on The Motley Fool Australia.

More reading

• Here’s everything you need to know about the IAG (ASX:IAG) dividend
• Leading brokers name 3 ASX shares to sell today
• We’ll pass thanks: Top broker downgrades IAG (ASX:IAG) share price to hold
• Here are the top 10 ASX shares today
• Here are the 3 most heavily traded ASX 200 shares this Friday

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

from The Motley Fool Australia https://ift.tt/ZEuyPQ8

Zip Co Ltd (ASX: Z1P) shareholders could be in for a ride this week amid talk of a potential capital raise.

The Zip share price is currently at $2.195, a fall of 7.38% on yesterday’s close. For perspective, the S&P/ASX 200 Index (ASX: XJO) is down 1.04% at the time of writing.

Let’s take a look at what could be in store for this buy now, pay later (BNPL) share.

Capital raise rumours

Zip could be conducting a capital raise as soon as this week, according to reports in The Australian. This could happen in the lead up to its merger with Sezzle Inc (ASX: SZL).

Zip revealed to the market yesterday it is in ongoing talks with Sezzle about a potential acquisition. In a statement to the market, Zip said:

There is no certainty that the discussions will result in a transaction of any kind and Zip will keep the market updated in accordance with its continuous disclosure obligations.

The Zip Board remains committed to ensuring any transaction delivers value to shareholders and will always be disciplined in its assessment of potential opportunities.

As my Foolish colleague James reported, the Zip share price slumped yesterday on the back of an update from the company.

Zip is expecting to report a cash EBTDA loss of $108.1 million in its H1 FY22 financial results. The company also expects to report a record $302.2 million in revenue. However, Zip shares closed 7.78% lower on Monday.

The company will reveal the full details of its financial results on Thursday.

The Australian also reported fellow ASX BNPL share Humm Group Ltd (ASX: HUM) may also be planning an equity raise ahead of Latitude Group Holdings Ltd (ASX: LFS) taking over its instalment and credit card operations. A deal on the acquisition was struck between the companies last week.

Zip share price snap shot

The Zip share price has fallen nearly 49% year to date and 82% over the past 12 months.

In the past week alone, Zip shares have slipped 19%.

For perspective, the benchmark ASX index has returned around 5% over the past year.

The post Own Zip (ASX:Z1P) shares? Rumours are circulating the company may be set for a capital raise appeared first on The Motley Fool Australia.

More reading

• Why Altium, PointsBet, Tyro, and Zip shares are sinking today
• Zip (ASX:Z1P) share price sinks to new 52-week low after revealing rising debts and big loss
• These were the worst performers on the ASX 200 last week
• What’s going so wrong for ASX BNPL shares this week?
• The ASX 200 is awash with 52-week lows on Friday. Here are some of the biggest names growing smaller

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended ZIPCOLTD FPO. The Motley Fool Australia has recommended Humm Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/5lMWq6h

Motley Fool Australia Chief Investment Officer Scott Phillips joined Nine’s Late News on Monday night to discuss a better-than-expected day for the ASX, the AGL Energy Limited (ASX: AGL) takeover bid, and travel companies returning to the skies.

The post AGL gets an offer and Australians return to the skies. Scott Phillips on Nine’s Late News appeared first on The Motley Fool Australia.

More reading

• ASX 200 shares stage comeback amid Russia optimism
• Here are the top 10 ASX shares today
• Own ASX dividend shares? Here are some of the payouts that have surprised so far this earnings season
• These 3 ASX 200 shares are topping the volume charts this Monday
• Why A2 Milk, AGL, Endeavour, and TPG shares are charging higher

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

from The Motley Fool Australia https://ift.tt/MQxLR5U

Shares in Cochlear Limited (ASX: COH) are on the move today after the company released its interim report and financial results for the half-year ended 31 December 2021.

At the time of writing, the Cochlear share price is trading 5.77% higher at $201.22 apiece.

Cochlear share price lunges higher on strong earnings growth

Key takeouts from the company’s earnings results today include:

• Sales revenue increased 10% (12% in CC) to $815 million
• Cochlear implant units increased 7% to 18,598
• Statutory net profit of $169 million includes $12 million in innovation fund gains after‐tax
• Underlying net profit (excluding one-off and non-recurring items) increased 26% to $158 million
• Interim dividend increased 35% to $1.55 per share, representing a payout of 65% of underlying net
  profit
• FY22 underlying net profit guidance range maintained at $265‐285 million

What else happened during the half for Cochlear?

The company’s sales mix was unevenly split between emerging and developed markets. For instance, Cochlear says its sales revenue increased 2% to $457.9 million in 1H “with a mix shift to the emerging markets”.

Whereas in these zones unit volumes increased by 30%, in developed markets, unit volumes decreased by 2%.

The biggest decline was seen in the US, Cochlear says. Sales there were “characterised by many operating theatres running below capacity throughout the half”, which ultimately compressed patient turnover.

This was initially due to the impact of Delta variant hospitalisations, whilst hospital staffing shortages were then compounded by the response to the Omicron variant in the second quarter.

Even still, acoustics revenue lunged 40% higher to a record $100.9 million and this carried through to underlying net profit of $158 million, a 26% year on year gain.

Keep in mind that ‘underlying’ net profit allows companies to remove one‐off and non‐recurring items like unrealised gains investments and gain on minority interests.

So when including these items in statutory net profit, Cochlear actually recognised $169 million at the bottom line. This result was underpinned by the “combination of strong sales growth and improved gross margin, with some benefit from lower‐than‐expected operating expenses”.

What’s next for Cochlear

Cochlear notes that for FY22, its underlying net profit guidance range has been maintained at $265‐285 million. This range signifies a 13‐22% increase on underlying net profit for FY21.

The guidance now incorporates “cloud computing expenses and anticipates continuing COVID impacts for the balance of the year”, Cochlear says.

Second half trading to date is tracking in line with the first half, the company says, “with continuing intermittent COVID‐related hospital or region‐specific elective surgery restrictions”.

In addition, guidance now factors in $18‐20 million of cloud investment (pre tax) as a result of the change in accounting treatment from capex to opex. Capex expectations have reduced to factor in this change, declining to around $70 million for FY22. As a result, we expect the net profit margin (inclusive of cloud costs) to remain a little below our longer‐term target of 18% for FY22 and FY23.

Cochlear share price

In the last 12 months, the Cochlear share price has slipped more than 9% and is down another 7% this year to date. Although, during the past month it has regained steam and has spiked 4%.

The post Cochlear (ASX:COH) share price 6% higher on juicy 35% dividend spike appeared first on The Motley Fool Australia.

More reading

• What to expect when Cochlear (ASX:COH) releases its half year results
• 2 medical tech ASX shares for turbulent times
• Can the Cochlear (ASX:COH) share price live up to analyst expectations?
• Do this now to be filthy rich later: expert
• 3 buy-rated ASX shares that just hit 52-week lows

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. owns and has recommended Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/CHx1KSZ

The Seven Group Holdings Ltd (ASX: SVW) share price is slipping in early trade, down 4.25%.

Seven Group shares closed yesterday trading for $22.36 and are currently at $21.41.

It’s not just the Seven Group share price under pressure today though. The S&P/ASX 200 Index (ASX: XJO) is down 1.1% as well.

Below we look at the highlights from the diversified investment group’s half-year financial results (1H FY22).

Seven Group share price slides despite profit lift

• Group revenue of $4.84 billion, up 105.3% year-on-year
• Underlying net profit after taxes (NPAT) lifted 21.5% to $302 million
• Earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $749 million, up 42.3% from $527 million in the prior corresponding period
• Interim dividend of 23 cents, fully franked, equal to what was paid in 1H FY22.

What else happened during the half-year?

Atop the impressive 21.5% increase in underlying NPAT, Seven Group reported an even more impressive 235.6% boost in statutory NPAT, which came in at $1.22 billion. This figure includes a gain of $757 million relating to the Group’s acquisition of Boral Limited (ASX: BLD) during the half-year.

The group’s diverse holdings ­– including Seven West Media Ltd (ASX: SWM), 38.9% owned – continued to deliver growth during the period, with energy a particularly strong performer.

Seven Group holds a 30% interest in Beach Energy Ltd (ASX: BPT). Despite a drop in production during the half-year, due to natural field decline and maintenance in the Cooper Basin JV and Western Flank, Beach’s EBIT contribution of $66.7 million was up 82.2% year-on-year. Higher energy prices also helped boost sales revenue 11.5% to $786 million.

The company’s operating cash flow was down from the prior corresponding period to $221.5 million. This was primarily due to investment in working capital in WesTrac, helping support growth amid supply chain disruptions.

What did management say?

Commenting on the results, Seven Group CEO Ryan Stokes said:

Today’s result demonstrates the benefits of our strategy to own a diversified portfolio of high-quality businesses across varied segments of the economy.

We like to assess our performance on a like-for-like, continuing operations basis, but I do note that in this period we consolidated Boral following our acquisition of a 69.6% stake during 2021. We are excited by the opportunity Boral presents. With the company having successfully pivoted back to Australia, we are supporting management to drive financial performance and deliver margins that are commensurate with Boral’s industry-leading position.

Importantly for SGH, we made a commitment to repay the transaction bridge facility of $2.97 billion within the financial year and are pleased to confirm that, following the Boral capital return, the bridge has been substantially reduced and will be fully repaid in March.

What’s next?

Looking ahead, Seven Group offered guidance saying it expects pro-forma EBIT for FY22 from continuing operations (excluding property) to increase between 8% and 10%.

It stated the businesses it has invested in are “well placed to capitalise on the expansion in mining production, infrastructure investment, media and energy markets”.

Seven Group share price snapshot

Over the past 12 months, the Seven Group share price is down 4%, trailing the 5% gains posted by the ASX 200 in that same period.

So far in 2022, Seven Group shares are down 2.7%, outperforming the 6% loss on the ASX 200.

The post Soaring profits fail to lift Seven Group (ASX:SVW) share price today appeared first on The Motley Fool Australia.

More reading

• Strong profit and sales growth can’t stop the ARB (ASX:ARB) share price from sinking today
• This ASX telco just reported 62% revenue growth
• Fruitful earnings: Costa Group (ASX:CGC) share price surges 8% on full-year results
• HUB24 (ASX:HUB) share price lifts 6% amid record platform inflows
• Nanosonics (ASX:NAN) share price sinks amid 45% half-on-half profit decline

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

from The Motley Fool Australia https://ift.tt/u12wrAb

The ARB Corporation Limited (ASX: ARB) share price is sliding lower on Tuesday morning following the release of the 4×4 parts manufacturer’s half year results.

At the time of writing, the ARB share price is down 5% to $40.16.

ARB share price slides despite strong growth

• Sales revenue up 26.5% over the prior corresponding period to $359.2 million
• Profit before tax up 27.6% to $92 million
• Profit after tax up 27.6% to $68.9 million
• Fully franked interim dividend up 34.5% to 39 cents per share

What happened during the first half?

For the six months ended 31 December, ARB reported a 26.5% increase in sales to $359.2 million. This was driven by growth across the business, with Australian Aftermarket sales up 15.6%, Exports up 39.9%, and Original Equipment sales up 50.6%.

In respect to Australian Aftermarket sales, the company notes that its sales growth of 15.6% outpaced the 1.7% growth in sales of new vehicles in ARB’s target market. Management believes this reflects the strength of its distribution network, the continuing trend towards local touring, stock availability, and a growing market.

ARB’s Export sales grew by 39.9% and now contribute 38.4% of the total sales. This is up from 34.7% in the prior corresponding period. ARB’s Export sales were boosted by the addition of Auto Styling Truckman in the UK, which was acquired in March 2021 and therefore was not part of the prior corresponding period’s figures. Outside this, the segment benefited from sales growth in the USA, the UK, and the Czech Republic.

Finally, Original Equipment sales increased 50.6% over the prior corresponding period thanks to OEMs stocking up in preparation for new vehicle model launches and the addition of new business. However, this strong form is not expected to continue, with sales to OEMs expected to soften during the second half.

Outlook

No guidance has been given for the full year due to COVID uncertainty, but management has provided the market with an idea of what it expects.

It explained: “The Company maintains a positive outlook based on a strong customer order book, improved inventory levels and new products that are yet to be released to market. However, the flow on impacts of COVID19, including disruptions to supply chains, shipping networks, retail operations and customer fulfilment, requires ARB to remain focused on managing customer expectations and supply chain pressures.”

“Notwithstanding the uncertainty in the current global economic and political environment, ARB continues to develop and pursue its exciting long term growth opportunities, including further growth in Australia and in export markets, new products, improved distribution and increased manufacturing capacity. The Board believes ARB is well positioned to achieve on-going success with strong brands around the world, loyal customers, very capable senior management and staff, a strong balance sheet and growth strategies in place,” it concludes.

The post Strong profit and sales growth can’t stop the ARB (ASX:ARB) share price from sinking today appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to sell next week
• Top brokers name 3 ASX shares to buy today
• Leading brokers name 3 ASX shares to sell today
• ARB Corporation (ASX:ARB) share price goes into overdrive, up 9% on revenue surge
• Why Airtasker, ARB, Bubs, and Sezzle shares are pushing higher

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

from The Motley Fool Australia https://ift.tt/FVDQdhv

The Swoop Holdings Ltd (ASX: SWP) share price is up 4.1% in early trade on Tuesday morning after the market digested the company’s results for the first half of the 2022 financial year.

What did the company report?

• 2022 half-year revenue soars 62% from 2021 first half
• Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) up 130%
• Underlying net loss after tax reduced by 26.7%
• 47% increase in subscriber numbers

What else happened in the first half?

Swoop completed 3 acquisitions during the first half, and another 2 in the current half-year.

The company raised $45 million of capital to enable the takeover of Speedweb, Countrytell and VoiceHub. 

What did management say?

“We had a fantastic half year which was capped off by another capital raise and a number of successful acquisitions which will facilitate further organic growth into new markets with new services,” said chief executive Alex West.

“Along with the board, the executive team and I are well on track to creating the next national Australian telco.”

What’s next?

West said that Swoop is “on track for an equally successful second-half of 2022”.

The second-half revenue is expected to be somewhere between $50 and $53 million, with underlying EBITDA to fall between $12 and $12.5 million.

This compares to first-half revenue of $23.9 million and underlying EBITDA of $5.3 million.    

Swoop share price snapshot

Swoop listed in May after an initial public offer that sold shares at 50 cents.

The stock has been as high as $2.46 in the past 12 months, but the telco has been caught up in the general market sell-off this year. The valuation has shrunk almost 32% since the start of 2022. 

However, with the stock starting Tuesday at $1.22, it’s still a nice 144% return in just 9 months for those lucky enough to own the business from its listing.

The post This ASX telco just reported 62% revenue growth appeared first on The Motley Fool Australia.

More reading

• Fruitful earnings: Costa Group (ASX:CGC) share price surges 8% on full-year results
• HUB24 (ASX:HUB) share price lifts 6% amid record platform inflows
• Nanosonics (ASX:NAN) share price sinks amid 45% half on half profit decline
• ‘Losses minimised’ but Helloworld (ASX:HLO) shares can’t hide from the havoc
• Banking on the South32 (ASX:S32) dividend? Here’s what you need to know

from The Motley Fool Australia https://ift.tt/mMwN5ek