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Although the outlook for interest rates is improving, it is likely to be some time until rates reach former levels. This could mean dividend shares remain one of the best places to earn a passive income for some time to come.

Two ASX dividend shares with attractive yields are listed below. Here’s what you need to know about them:

National Storage REIT (ASX: NSR)

The first dividend share to look at is this leading self-storage operator. Thanks to its successful growth through acquisition strategy, National Storage has been growing at a solid rate over the last decade.

And while the company has now amassed a portfolio of over 210 centres, its growth looks unlikely to stop there. Management continues to see scope to grow its network further in a fragmented industry.

At National Storage’s AGM, Chairman Laurence Brindle commented: “The ownership of self storage centres remains highly fragmented, and we are confident that this pipeline of high-quality storage centres will continue to create acquisition opportunities for the foreseeable future.”

This is likely to bode well for its distribution growth over the long term. For now, though, the company is forecasting at least 10% earnings per share growth in FY 2022. If its distribution grows at the same rate, it will mean a distribution of 9.02 cents per share.

Based on the current National Storage share price of $2.38, this would mean a yield of 3.8%.

Rural Funds Group (ASX: RFF)

Another ASX dividend share to look at is Rural Funds. It is an agricultural real estate investment trust (REIT) that owns a diversified portfolio of Australian agricultural assets which are leased predominantly to corporate agricultural operators. These include ASX-listed companies such as Select Harvests Limited (ASX: SHV) and Treasury Wine Estates Ltd (ASX: TWE).

Rural Funds has also just added to its portfolio through the acquisition of cattle and cropping properties in central Queensland and macadamia orchards elsewhere in Queensland.

These acquisitions are consistent with its strategy of acquiring assets with potential for productivity improvements, in agricultural sectors in which it has operating experience and Australia has a comparative advantage. This strategy has been very successful in the past and underpins the company’s plan to grow its distribution by 4% each year.

Pleasingly, management confirmed that this remains the case in FY 2022, with Rural Funds intending to increase its distribution by 4% to 11.73 cents per share. Based on the current Rural Funds share price of $2.84, this represents an attractive yield of 4.1%.

The post 2 excellent ASX dividend shares with attractive yields appeared first on The Motley Fool Australia.

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• 2 top ASX dividend shares with 4%+ yields
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• 2 quality ASX dividend shares with 4%+ yields

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 owns shares of and has recommended RURALFUNDS STAPLED. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) (Soul Patts) share price is in focus as the investment conglomerate has decided not to go ahead with listing its Round Oak Metals business.

Cancelled IPO

It was only last week that Soul Patts sent out a letter ahead of its 2021 annual general meeting, inviting shareholders to consider whether they might be interested in an initial public offering (IPO) and subscribing for shares. The plan had been that the prospectus would be lodged with ASIC this week.

Soul Patts thanked shareholders who had registered their interest in participating in the proposed Round Oak offering.

The investment conglomerate said that it has decided not to go ahead with the IPO process at this time for two reasons.

First, it referred to the “current market conditions for IPOs”.

The other reason it noted was encouraging exploration results at Round Oak’s Jaguar operations in Western Australian that have the potential to materially extend the mine’s life.

Round Oak’s Jaguar operations is an operating underground zinc and copper mine located within the Eastern Goldfields of Western Australia, 60km north of Leonora and 250km north of Kalgoorlie.

Under Round Oak’s current description of Jaguar it says that it has a “current mine life of four years, with significant potential for the operational life to be extended through exploration campaigns.”

Round Oak trading update

Sometimes updates can have an impact on the Soul Patts share price.

Soul Patts gave investors a brief trading update about how Round Oak is going.

It said that the mining business continues to perform well with strong operations and favourable copper and zinc prices. Management believe that extending the life of the mine at Jaguar and progressing the Stockman project in Victoria will add material value for Soul Patts shareholders.

How important is Round Oak to Soul Patts?

In FY21, Soul Patts reported that it achieved group regular net profit after tax (NPAT) of $328 million (up 93%) and group statutory NPAT of $273 million, down 71%.

Those profit numbers are generated from the dividends, distribution and profit that Soul Patts has exposure to with its portfolio. There are various names that provide large contributions such as TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW) and New Hope Corporation Limited (ASX: NHC).

The regular profit increase was predominately due to three reasons.

Soul Patts noted the growth in building products and land revaluations increasing Brickworks’ contribution by 95%.

There was a strong recovery in coal prices, increasing New Hope’s profit contribution by 45% year on year.

Finally, Soul Patts pointed to a significant improvement at Round Oak, with an increase of $103 million.

For Round Oak Metals, Soul Patts believes there are structural tailwinds in supply and demand, which is expected to support strong copper prices with “robust” construction demand led by China, a transition to renewable energy sources and the increasing electric vehicle uptake.

Is the Soul Patts share price a buy?

Whilst Morgans still rates it as a hold, the price target is $36.78.

Soul Patts shares have fallen by more than 10% over the last month and more than 20% since 28 September 2021.

The post Soul Patts (ASX:SOL) share price in focus as Round Oak IPO scrapped appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Brickworks. The Motley Fool Australia owns shares of and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended TPG Telecom Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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On Thursday the S&P/ASX 200 Index (ASX: XJO) was out of form again and sank lower. The benchmark index fell 0.6% to 7,381.9 points.

Will the market be able to bounce back from this on Friday? Here are five things to watch:

ASX 200 expected to rise

The Australian share market looks set to end the week on a positive note. According to the latest SPI futures, the ASX 200 is expected to open the day 34 points or 0.45%. This follows a largely positive night of trade on Wall Street, which late on sees the Dow Jones down 0.4%, but the S&P 500 up 0.2% and the Nasdaq up 0.7%.

Xero rated as a buy

The Xero Limited (ASX: XRO) share price pullback on Thursday is a buying opportunity according to analysts at Goldman Sachs. According to a note this morning, the broker has reiterated its buy rating but trimmed its price target on the cloud accounting company’s shares to $158.00. While Xero delivered a weaker than expected half year result, the broker remains positive on the future.

Oil prices edge higher

Energy producers including Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could end the week on a positive note after oil prices edged higher. According to Bloomberg, the WTI crude oil price is up 0.15% to US$81.48 a barrel and the Brent crude oil price is up 0.2% to US$82.79 a barrel. This was despite OPEC cutting its oil demand forecast due to high prices.

Ramsay given buy rating

The Ramsay Health Care Limited (ASX: RHC) share price came under pressure yesterday following the release of its first quarter update. However, in response to the update, Goldman Sachs has retained its buy rating and $74.00 price target. The broker continues to highlight the company as one of the more attractive recovery trades across its coverage.

Gold price higher

Gold miners Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) could have a good finish to the week after the gold price pushed higher. According to CNBC, the spot gold price is up 0.9% to US$1,864.6 an ounce. The gold price is closing in on a five-month high as inflation concerns boost appeal.

The post 5 things to watch on the ASX 200 on Friday appeared first on The Motley Fool Australia.

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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 shares of and has recommended Xero. The Motley Fool Australia owns shares of and has recommended Xero. The Motley Fool Australia has recommended Ramsay Health Care Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The De Grey Mining Limited (ASX: DEG) share price performed exceptionally well on Thursday. Shares in the gold explorer gained momentum throughout the day after the company released infill results to the market.

These results were positively received by investors. In turn, the De Grey share price surged 8.2% to $1.25. However, the ASX-listed mining company wasn’t the only solid performer in the sector today. Other honourable mentions include Fortescue Metals Group Limited (ASX: FMG), Mineral Resources Limited (ASX: MIN), and Evolution Mining Ltd (ASX: EVN) — all trumpeting a gain of more than 4% on Thursday.

With all that being said, let’s take a closer look at De Grey’s latest announcement.

Infill results a positive for the De Grey share price

Investors have been instilled with some additional confidence following De Grey’s published results from today. Importantly, the infill drilling undertaken within the proposed Brolga Stage 1 pit demonstrated consistency in its gold discovery.

Infill drilling is used to give a higher resolution understanding of the discovered mineralisation during a prior drilling program. In short, holes are drilled in between the previously drilled holes to map out exactly where the gold might be located and how much of it.

In De Grey’s latest infill drilling across multiple sections, it was determined that the mineralisation holds consistent throughout much of the scoped area. Unsurprisingly, this result was met with enthusiasm towards the De Grey share price today.

For reference, the proposed Brolga Stage 1 pit comprises 1.29 million ounces at 1.3 grams of gold per tonne. The drilling shared with investors today produced similar numbers, such as:

• 80m at 1.6g/t Au from 36m
• 93m at 2.2g/t Au from 43m
• 127m at 2.0g/t Au from 35m
• 114m at 1.5g/t Au from 126m

Commenting on these results, De Grey general manager exploration, Phil Tornatora said:

The recently announced scoping study of the Mallina Gold Project identified Brolga as an early production source. These new resource infill drilling results successfully demonstrate the continuity of mineralisation within the proposed Brolga Stage 1 pit. Resource infill drilling is reducing project risk associated with early production. The 40m x 40m drill spacing at Brolga is expected to provide a high level of confidence in the early production from Brolga.

Positively, the results give increased confidence in the project’s projected cash flow from early production sources.

Next steps

Following this, De Grey will continue its infill drilling program as part of its pre-feasibility study of the Mallina Gold Project. Specifically, the program is expected to run over a further three months.

Finally, drilling is continuing across the company’s Great Hemi and Regional areas. This includes three aircore and three RC rigs engaged in exploratory activities.

The post De Grey (ASX:DEG) share price leaps 8% as project confidence grows 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 Bruce Jackson.

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Shares in nanotechnology and biotech company Imagion Biosystems Ltd (ASX: IBX) charged higher today to finish 14% in the green. The Imagion Biosystems share price jumped from the open following a company response to a query from the ASX.

The ASX wanted to know why the company’s share price spiked – in almost vertical fashion – over 40% from Friday’s close to finish at 10 cents on Tuesday.

Imagion provided its answers in a detailed response to the ASX that was posted before the open today.

Here are the details.

What’s up with the Imagion Biosystems share price lately?

Backtracking to the final week of October, Imagion released its quarterly report, covering several investment highlights.

The company, which specialises in medical diagnostic imaging technology, advised it had now enrolled multiple patients into a Phase 1 study of its novel imaging agent MagSense.

The study is investigating the safety of MagSense in its intended use, as a non-invasive alternative to detect early-stage HER2 breast cancer.

It also partnered with Global Cancer Technology during the quarter. The pair will develop Global Cancer’s nanoscintillator technology, also potentially indicated in breast cancer albeit on the treatment side.

Imagion is set to receive funding from Global Cancer Technology as the pair combine technologies to search for a breakthrough in the disease segment.

Imagion also funded its first animal studies investigating MagSense as an imaging solution for prostate cancer.

The market appeared to have a delayed reaction to Imagion’s quarterly update. From the close of trading last Friday to Tuesday’s close, the Imagion Biosystems share price roared from 7.1 cents to a 3-month high of 10 cents.

It is this market activity that had the ASX contacting Imagion in search of some answers.

In a standard compliance letter from the ASX’s Melissa Kostopoulous, the company was asked to explain any possible causes for the gain.

“Is IBX aware of any information concerning it that has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities?”

How did Imagion respond?

The company replied that it was not aware of any such information. It did, however, make mention of the recent quarterly update, and in particular, the additional enrolments into its MagSense Phase 1 trial.

This is important to note because earlier in the year, Imagion had announced it was having difficulty achieving this due to COVID-19.

Even though the first patients had been enrolled, capturing further study participants was proving a challenge for Imagion.

Hence, the announcement it had secured additional patients in the study cohort can be deemed as a net positive for the company. This could have had an impact on its share price, the company said.

Imagion concluded that it is in fact in compliance with all ASX listing rules and requirements.

Imagion Biosystems share price snapshot

The Imagion Biosystems share price has posted a loss of almost 34% since January 1.

Yet, despite this, it has returned 18% to shareholders over the past 12 months. This is ahead of the benchmark S&P/ASX 200 index (ASX: XJO)’s return of around 14.5% in that time.

The post The Imagion Biosystems (ASX:IBX) share price leapt 40% in 2 days this week. What’s happening? appeared first on The Motley Fool Australia.

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The author Zach Bristow has no positions 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.

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The Dusk Group Ltd (ASX: DSK) share price finished Thursday’s market session lower after the company provided a trading update.

At the closing bell, the specialty retailer’s shares ended at $3.03 a pop, down 3.19%.

Dusk reports fall in sales

Investors drove the Dusk share price lower following the company’s late afternoon market release.

For the 19 weeks ending 7 November, Dusk advised its sales have been impacted as a result of store closures. In particular, New South Wales, Victoria, and the Australian Capital Territory were forced shut by state governments due to COVID-19. This effectively reduced the number of store trading days by around 33% over the period.

Total year-to-date unaudited sales have declined by 22.9% when compared to FY21. It is estimated this metric will be between $10 million and $11 million below the prior corresponding period. In addition, pro-forma earnings before interest, tax, depreciation and, amortisation (EBITDA) will also likely be down around $6 million to $7 million.

Total like-for-like (LFL) sales fell 8.5% when measured against last financial year’s performance. Although, since the reopening of all stores, both states and the territory have delivered positive LFL sales growth.

Another positive is that online sales have continued to surge, achieving a 19% lift versus FY21.

On a year-to-date basis, the company noted that gross margins have increased on the same period in FY21. Elevated freight costs have been offset by a favourable foreign currency position and higher retail prices in June 2021.

The results haven’t impressed investors, judging by the fall in the Dusk share price today. However, Dusk CEO Peter King was optimistic. He commented:

We anticipate that customers will be encouraged to shop in stores in the lead-up to Christmas due to pent-up demand, combined with delays in deliveries for online purchases.

Having opened 6 new stores so far in FY22, we now have 128 stores (including online). With all stores now open and stock levels as planned, we are ready to capitalise upon the key Christmas trading period.

Dusk share price summary

Despite today disappointing results, the Dusk share price has zoomed upwards by 50% in 2021. However, when factoring in the last 12 months, its shares are up by 89%.

Based on today’s price, Dusk commands a market capitalisation of roughly $194.9 million and has approximately 62.3 million shares outstanding.

The post Dusk (ASX:DSK) share price backtracks following sales update 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 Dusk Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Are you looking to make some additions to your portfolio? If exchange traded funds (ETFs) are of interest to you, then you might want to look at the three listed below.

Here’s what you need to know about them:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The first ASX ETF to look at is the BetaShares Global Cybersecurity ETF. This popular ETF gives investors exposure to the leading companies in the global cybersecurity sector. Due to the growing threat of cyberattacks globally, demand for cybersecurity services has been increasing strongly.

This could see the companies in the fund, which includes the likes of Accenture, Cisco, Cloudflare, Fortinet, Okta, Splunk, Zscaler, Crowdstrike, well-placed for growth over the 2020s.

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

Another ETF for ASX investors to look at is the VanEck Vectors Video Gaming and eSports ETF. This ETF allows investors to buy a piece of the largest companies involved in video game development, hardware, and esports. This includes Activision Blizzard, AMD, Electronic Arts, Nintendo, Nvidia, Roblox, and Take-Two.

VanEck highlights that these companies are well-placed to benefit from the increasing popularity of video games and eSports.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

A final ETF to look at is the Vanguard MSCI Index International Shares ETF. This ETF provides investors with exposure to a massive 1,504 of the world’s largest listed companies from major developed countries. This makes the ETF one of the most diverse options available to investors.

Among the high quality companies you’ll be owning a slice of are Amazon, Apple, Johnson & Johnson, JP Morgan, Nestle, Nvidia, Tesla, and Visa. Vanguard notes that buying this ETF allows investors to take part in the long-term growth potential of international economies.

The post 3 fantastic ETFs for ASX investors in November appeared first on The Motley Fool Australia.

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• Why is the Vanguard MSCI Index International Shares ETF (ASX:VGS) off to such a great start in November?
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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 shares of and has recommended BETA CYBER ETF UNITS and Vanguard MSCI Index International Shares ETF. The Motley Fool Australia owns shares of and has recommended BETA CYBER ETF UNITS. The Motley Fool Australia has recommended VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports ETF and Vanguard MSCI Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) has finished the day down 0.57% . But one ASX exchange-traded fund (ETF) that investors might not have expected to fall today has done a lot worse. The BetaShares Crypto Innovators ETF (ASX: CRYP) barrelled towards the end of the day. This CRYP ETF finished the day down 4.99%, sitting at a unit price of $11.24.

That might come as a surprise to some investors. Since this ETF floated on the ASX just one week ago today, it had doled out some very impressive gains. In addition, it also managed to break the ASX record for the highest trading volume for a newly-listed fund within its first few hours of life.

As of Tuesday’s close, CRYP units hit a price of $12.38, meaning they were up more than 10% since its ASX debut mere days beforehand. Today’s nasty drop erases much of those gains, and puts CRYP unitholders back at the rough prices this ETF was asking on its first day of trading. Not quite square one, but getting close.

So what has caused this dramatic reversal of fortunes for this new and exciting ETF?

CRYP ETF gets pulled back to earth

Well, to answer that, let’s check out what’s been going on with CRYP’s underlying holdings. Like most ETFs, CRYP holds within it an underlying basket of shares. In this ETF’s case, these shares are selected to give investors “exposure to global companies at the forefront of the dynamic crypto economy”.

So, according to the provider, CRYP’s current top 5 holdings are as follows:

1. Marathon Digital Holdings Inc
2. Galaxy Digital Holdings Ltd
3. Silvergate Capital Corp
4. Coinbase Global Inc
5. Microstrategy Inc

As it happens, all five of these US-based companies (with the exception of Canada’s Galaxy Digital) had big falls in their valuations overnight (our time) on the US markets. And they weren’t small drops either. Galaxy Digital and Marathon Digital each fell by close to 15%. Silvergate fell by 7.3%, while Microstrategy was down close to 5%. These moves might have been prompted by Coinbase reporting its quarterly earnings, upon which Coinbase shares crashed 8%. 

All this is despite the fact that cryptocurrencies themselves (which the CRYP ETF does not directly invest in) remain at elevated pricing. Indeed, Bitcoin (CRYPTO: BTC) just hit a new all-time high yesterday, although it has fallen by around 6% since then. 

This ETF’s provider BetaShares does warn that “an investment in CRYP should be considered very high risk”. Today proves just why.

The post Why was the new BetaShares Crypto Innovators ETF (ASX:CRYP) down 5% on Thursday? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen owns shares of Bitcoin and Coinbase Global, Inc. 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.

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Today, the S&P/ASX 200 Index (ASX: XJO) followed in the footsteps of Wall Street as it deepened its week of losses so far. Disappointingly, the benchmark index finished 0.57% lower at 7,381.9 points.

It was another day dominated by weakening share prices across the ASX today. Across all the sectors it was tech and healthcare that felt the pinch the most. At the other end of the market, mining shares boomed today irrespective of the falling iron ore price.

However, the question is: which shares delivered the biggest returns to investors on the ASX today? Here are the ten stocks that rose to the occasion:

Top 10 ASX shares countdown today

Looking at the top 200 listed companies, Novonix Ltd (ASX: NVX) was the biggest gainer today. Shares in the battery technology company jumped 10.4% partially rebounding from its 14% loss yesterday. Find out more about Novonix here.

The next biggest gaining ASX share today was Chalice Mining Ltd (ASX: CHN). Shares in the gold explorer posted another day of gains, placing in the top 2 best-performing ASX shares for three days straight now. Uncover the latest Chalice Mining details here.

Today’s top 10 biggest gains were made in these ASX shares:

ASX-listed company	Share price	Price change
Novonix Ltd (ASX: NVX)	$9.02	10.40%
Chalice Mining Ltd (ASX: CHN)	$9.98	9.31%
Fortescue Metals Group Ltd (ASX: FMG)	$15.49	8.47%
Mineral Resources Ltd (ASX: MIN)	$39.22	5.86%
Evolution Mining Ltd (ASX: EVN)	$4.13	4.56%
Northern Star Resources Ltd (ASX: NST)	$10.60	4.54%
Bluescope Steel Ltd (ASX: BSL)	$20.74	3.70%
Champion Iron Ltd (ASX: CIA)	$4.19	3.20%
Nine Entertainment Co Holdings Ltd (ASX: NEC)	$3.05	3.04%
Seek Ltd (ASX: SEK)	$35.11	2.96%

Our top 10 ASX shares today countdown is a recurring end-of-day summary to ensure you know which companies were making big moves on the day. Check-in at Fool.com.au after the market has closed during weekdays to see which stocks make the countdown.

The post Here are the top 10 ASX shares today appeared first on The Motley Fool Australia.

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• Nine Entertainment (ASX:NEC) share price climbs 3% amid earnings guidance
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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 recommended SEEK Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Orica Ltd (ASX: ORI) share price finished the day in the red after the company released its full-year results to the market today.

At the closing bell, the Orica share price was $14.79, 3.65% lower than its previous close.

Let’s take a closer look at how the explosives-focused mining and infrastructure solutions provider performed during the year ended 30 September 2021.

Orica share price slides on 30% drop in EBIT

Here are the key takeaways from Orica’s full-year performance:

• Statutory net loss after tax of $174 million, including $382 million loss from significant items after tax;
• Earnings before interest and tax (EBIT) of $427 million – 30% less than that of the previous year before significant items;
• Underlying earnings per share of 51.2 cents – 32% less than the prior corresponding period (pcp); and
• 16.5 cent unfranked final dividend.

Over the year just been, the company’s capital expenditure was $323 million, down 5% on the pcp. Its net operating cash flows came to $619 million, up more than 100% on the pcp.

It also recorded net debt of $1.5 billion and gearing at 34.6%.

The company’s final dividend brings its full-year dividends to 24 cents with a payout ratio of 47%.

What happened over the year ended 30 September?

According to the company, its full-year results reflect a challenging year within which it was hit by several market factors.

These included unfavourable foreign exchange movements, disrupted thermal coal trade flows resulting from political tensions with China, increased sea freight costs, and rising input costs.

The company successfully integrated the Exsa business, got the Burrup explosives plant fully operational and producing product, and continued its uptake of technology solutions.

Orica also sold non-core land, generating $140 million of cash in the process.

Over the last 6 months, Orica has refreshed its strategy to deliver solutions and technology that drive productivity for its mining and infrastructure customers.

Over the full year, Orica committed to reduce its operational scope 1 and 2 greenhouse gas emissions by at least 40% on its 2019 levels by 2030. It also recently announced its ambition to achieve net-zero scope 1, 2, and material scope 3 emissions by 2050.

Its volume total ammonium nitrate increased 4% on the pcp over the year ended 30 September. However, its net volume was less than the pcp because of disruptions to Australian East Coast thermal coal trade and lower sales volumes in Colombia and Chile.

Cyanide volumes were also down 6% due to lower demand and shipping constraints.

Orica saw a 14% increase in demand for its Electronic Blasting Systems and an 8% increase in demand for premium emulsion.

Its struggles over the year seem to have been reflected in the Orica share price today.

What did management say?

Orica managing director and CEO Sanjeev Gandhi commented on the company’s results, saying:

The fundamentals of the business are strong. We have refreshed our strategy to refocus on driving profitable growth and creating enduring value for our shareholders and other stakeholders. As our strategy is embedded in our business, we will be well placed to seize opportunities as the market stabilises.

Our four key business verticals will allow us to leverage our strengths and create opportunities for growth beyond blasting…

We expect steady commodity growth in 2022 which will drive stabilised demand for explosives-related products and services…

Earnings in 2022 are expected to improve from increased adoption of our advanced technology offerings, volume growth, supply chain initiatives and sustainable overhead cost reductions.

What’s next for Orica?

Here’s what might drive the Orica share price over the current full year:

The company’s capital expenditure is expected to be between $340 million and $360 million. Its depreciation and amortisation expense is expected to be up to 5% higher. It expects its gearing to remain within the range of 30% to 40%.

It also expects global commodity growth to continue, particularly in the copper and gold, and quarry and construction markets.

The company will keep focusing on its balance sheet and maintaining its cash-flow optimisation.

Over the next 3 years, Orica will look to create a pathway to profitable, organic growth.

It will do so by adopting innovative blasting technologies and digital solutions, both upstream and downstream, and optimising its manufacturing and supply chains.

It also plans to grow into the future-facing commodities space, expanding into the mining chemicals segment, and diversifing its portfolio.

Orica hopes to achieve an average 3-year return on net assets of 10% to 12%, gearing of 30% to 40%, and a dividend payout ratio of 40% to 70%.

It will strengthen its balance sheet by exiting up to 10 countries and continuing its land sales.

Orica share price snapshot

Over the year ended 30 September 2021, the Orica share price fell by around 10%.

It is currently 3% lower than it was at the start of 2021.

The post Orica (ASX:ORI) share price struggles following $174 million loss 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 no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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