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The Incannex Healthcare Ltd (ASX: IHL) share price is gaining ground in early trade today and is currently changing hands at 37.5 cents apiece.

At one point today, shares in the medicinal cannabis company were trading 6% higher on the previous close at 38 cents before taking a small step down.

Incannex shares are on the move after the company announced a key update regarding a manufacturing contract for its IHL-42X drug candidate.

Here’s what we know from the company this morning.

Incannex share price spikes on manufacturing contract

Incannex advised it has engaged drug manufacturer Procaps Laboratories S.A. to “develop and manufacture IHL-42X soft gel capsules”.

According to Incannex, Procaps has global expertise in drug development, having assisted in over 500 formulations for both nutritional and pharmaceutical products in more than 50 markets globally.

Meanwhile, the IHL-42X candidate its Incannex’s proprietary cannabinoid formulation to treat obstructive sleep apnoea (OSA).

OSA is an often overlooked condition that has significant implications on cardiovascular, mental, and physical wellbeing. It’s hoped Incannex’s drug candidate can provide a remedial breakthrough in this field.

The agreement between Incannex and Procaps is effective immediately and will involve the manufacture of pharmaceutical grade soft gel capsules to be sent off and “used in pivotal phase 2, phase 3 and open label clinical trials”.

Procaps will supply the capsules as long as they are required for clinical trial purposes.

On Procaps’ end, it requires “twelve-month non-binding forecasts with four-month firm orders” for its own planning. At the same time, manufacturing costs are expected to be non-meaningful to Incannex’s bottom line.

The announcement builds on previous regulatory tailwinds that have established credibility in Incannex’s products and novel treatment alternatives in 2021.

The company also filed for patent protection over IHL-42X in several jurisdictions this year which, if successful, is sure to beef up its product portfolio.

Investors like the news today and are bidding the Incannex share price higher in early trade, on about half the volume of its 4-week average.

Shareholders will welcome any gains. They are 6% in the red over the last month after a period of volatility in their Incannex holdings.

Incannex share price snapshot

The Incannex share price has climbed 142% this year to date, less than half of its 12-month return of 346%.

Both of these results are well ahead of the S&P/ASX 200 Index (ASX: XJO)’s return of about 19% in that time.

The post Incannex (ASX:IHL) share price leaps 6% on manufacturing update appeared first on The Motley Fool Australia.

More reading

• How did ASX healthcare shares perform in the FY22 first quarter?
• The Incannex (ASX:IHL) share price has lost 20% in 4 weeks. What’s happening?

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 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 Aussie Broadband Ltd (ASX: ABB) share price is in the red today after the company used its quarterly trading update to slam NBN for allegedly profiting from lockdowns.

The telecommunications company posted an impressive performance for the quarter ended 30 September 2021. However, it also reported its costs for NBN’s CVC (connectivity virtual circuit) management increased 137% to $3.3 million over the quarter. The company stated:

Aussie Broadband believes NBN is earning additional CVC overage revenue as a direct result of the lockdowns, whilst incurring little to no incremental cost.

At the time of writing, the Aussie Broadband share price is $5.00, 1.57% lower than its previous close.

Let’s take a closer look at the company’s first quarter of financial year 2022 and its grievance with NBN.

Aussie Broadband share price gains on strong quarter

The first quarter was a good one for Aussie Broadband.

It saw its revenue increase 11.3% quarter on quarter, reaching $111.4 million. That was boosted by its expanded first month free broadband promotion and two months free mobile services promotion.

Its total number of broadband connections increased by 11% on the previous quarter. Its business broadband connections increased by 13% and the company onboarded 15% more mobile services.

Because of its seemingly successful sales campaign, the company’s promotion spend increased.

Aussie Broadband noted it was happy to sacrifice its intra-period earnings before interest, tax, depreciation, and amortisation (EBITDA) for higher levels of subscriber growth.

The company also started connecting services for its first white label customer, Origin Energy Ltd (ASX: ORG), over the quarter just been.

Finally, it has nearly finished migrating mobile customers from the Telstra Corporation Ltd (ASX: TLS) network to Optus. To date, it has retained more than 90% of its mobile customers through the switch.

NBN gripe

However, it wasn’t all positive news from the ASX newbie this morning. Aussie Broadband aired its grievances with the NBN, stating the network is profiting from lockdowns.

Aussie Broadband claimed NBN isn’t doing enough to share the weight of increased demand for internet during lockdowns.

Basically, NBN charges internet providers differing amounts depending on how many connectivity virtual circuits (CVC) they have access to.

CVC sort of works like another form of bandwidth. The more a customer has access to, the faster their internet will be. And over the quarter, Aussie Broadband provided the fastest internet of all major Australian providers.

The trouble apparently is, when everyone is stuck at home, internet providers need to provide more internet.

Aussie Broadband states providing more CVC capacity doesn’t increase costs for NBN. It said the industry believes providers are “bearing an unfair share of the cost… and NBN should be doing more to support Australians during this difficult period.”

Over the quarter just been, Aussie Broadband was given around $800,000 worth of rebates from NBN for increased CVC usage. From 1 October, those rebates have been changed, but the changes won’t be backdated.

Aussie Broadband also took advantage of NBN’s focus on fast campaign, which lessened its costs by an estimated $1 million. Still, Aussie Broadband stated:

Had the company not proactively migrated customers under the focus on fast campaign, and had NBN not provided relief during the period, total CVC expense for the quarter would have been an estimated $5.1 million, an increase of 264% on the previous quarter.

What’s next for Aussie Broadband?

Aussie Broadband also provided the market with some guidance for the coming quarter.

It expects to onboard between 53,000 and 60,000 new broadband customers, including 20,000 white label services, over the second quarter.

Due to lockdowns in Victoria and New South Wales, the company also expects its increased CVC usage charges to continue. Though, usage has lessened in New South Wales recently, supporting the idea that the costs will return to normal when lockdowns end.  

Finally, Aussie Broadband believes its marketing and promotional costs will stay high through Q2 and for the rest of financial year 2022, if growth opportunities continue.

The post Aussie Broadband (ASX:ABB) share price drops out on trading update and NBN gripe appeared first on The Motley Fool Australia.

More reading

• How Aussie Broadband (ASX:ABB) is just smashing it right now
• Wilson Asset Management believes these 2 leading small cap ASX shares are a buy
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• Here’s why the Aussie Broadband (ASX:ABB) share price is lifting today
• 4 ASX shares looking ripe for the picking now

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. owns shares of and has recommended Aussie Broadband Limited. The Motley Fool Australia has recommended Aussie Broadband 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 Firefinch Ltd (ASX: FFX) share price is edging higher in early trade, up 1%.

Below we take a look at the ASX lithium share’s project update and the latest on its demerger plans.

Firefinch share price lifts on lithium expansion plans

The Firefinch share price is in the green this morning after the company reported it had formed a joint venture (JV) to develop the Goulamina Lithium Project, located in Mali.

The JV with Chinese company, Jiangxi Ganfeng Lithium (Ganfeng), will see Ganfeng pitch in US$130 million (AU$173 million) in cash as well as securing up to US$64 million in debt.

The JV remains subject to various conditions precedent, but has received Chinese regulatory approvals and support from Mali’s government.

The new partners plan to start a major 2-year drilling campaign. The US$6 million program will drill some 50 kilometres, with the aim of lifting reserves and resources to “rank Goulamina even higher among the largest global lithium projects”.

The company expects the new drill campaign will support a 23-year mine life at a higher rate of production. Its Definitive Feasibility Study (DFS) update is considering a 75% increase in production capacity. That would take production from 2.3 million to 4 million tonnes per year in a phase 2 expansion.

Demerger update

The Firefinch share price could also be getting a boost following this morning’s update on its demerger plans for Leo Lithium Pty Ltd. According to the release, once the demerger is complete, Leo will be a standalone company with a 50% interest in the JV with Ganfeng.

Leo Lithium aims to be listed on the ASX by the end of the March 2022 quarter. A shareholder meeting to vote on the demerger is slated for February.

Under the existing proposal, Firefinch would hold on up to 20% of Leo shares post demerger. Eligible Firefinch shareholders will receive an in-specie distribution of Leo shares at no cost.

What did management say?

Commenting on the progress, Firefinch’s managing director, Michael Anderson said:

Considerable progress has been made advancing Goulamina over the past few months. The key takeaway is that following the proposed demerger in 2022, Goulamina will be substantially funded, with engineering and procurement well progressed and 50km of drilling already underway.

Importantly, Goulamina will be on a quick path to production, expected in 2023, and in an enviable position to take advantage of prevailing very strong lithium market conditions.

Firefinch share price snapshot

The Firefinch share price is up an eye-popping 253% year-to-date. By comparison the All Ordinaries Index (ASX: XAO) is up 11% so far in 2021.

Over the past month Firefinch shares have gained 10%.

The post Firefinch (ASX:FFX) share price lifts on lithium update appeared first on The Motley Fool Australia.

More reading

• ASX lithium shares mixed on Tuesday as prices surge to all-time highs
• Why ASX lithium shares are booming on Thursday
• ASX lithium shares lift as spot prices hit all-time highs
• Firefinch (ASX:FFX) share price struggles despite lithium project update

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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ASX cannabis shares were once one of the hottest sectors with no shortage of new pot stocks hitting the market.

The Cann Group Ltd (ASX: CAN) share price, for example, skyrocketed almost 300% between September 2017 and January 2018 amid the federal government allowing medicinal cannabis exports and booming M&A deals taking place across the sector.

Unfortunately, money came out of this sector as fast as it went in.

Fast forward to today, most ASX cannabis shares sit around multi-year, if not all-time lows. It isn’t unusual to find players down 80-90% from their all-time highs.

Despite being beaten up and battered, these cannabis shares have managed to find somewhat of a floor in recent months.

While trading sideways for the past 1-2 months, this week has proven to be a small win for these beaten-up stocks.

The Cann Group share price is up 20.5% this week to a 3-month high of 34 cents.

Althea Group Holdings Ltd (ASX: AGH) is up 9.5% to a 2-month high of 29 cents.

Similarly, Ecofibre Ltd (ASX: EOF) is up 4.7% to a 4-month high of 89 cents.

Why ASX cannabis shares are bouncing higher?

ASX cannabis shares are likely taking off after a 7.1% jump in the Global X Cannabis Exchange Traded Fund (ETF) on Tuesday night.

The cannabis ETF invests in companies across the industry, involved in the legal production, growth and distribution of cannabis and industrial hemp.

Canadian and US-listed companies make up more than 90% of its allocation but the ETF does have a small allocation in Creso Pharma Ltd (ASX: CPH).

Last month, the Motley Fool US reported that a panel from the US House of Representatives is preparing for a vote to “federally legalise marijuana” outright.

This move will look to “decriminalise marijuana federally” in the US by removing it from the Controlled Substances Act.

The post Beaten up ASX cannabis shares showing signs of life appeared first on The Motley Fool Australia.

More reading

• Creso Pharma (ASX:CPH) share price struggles despite study update
• Creso Pharma (ASX:CPH) share price jumps on new deal

Motley Fool contributor Kerry Sun 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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The Super Retail Group Ltd (ASX: SUL) share price is rallying higher after the company released a trading update for the first 16 weeks of FY22.

At the time of writing, the Super Retail share price is up 3.34% trading at $13.46.

How did Super Retail fare during this trading period?

COVID-19 lockdowns across key markets of New South Wales, Victoria, ACT and New Zealand have severely impacted trading, more so than the previous corresponding period.

Super Retail reported year to date like-for-like sales declines across the board for the first 16 weeks for FY22, with Supercheap Auto sales sinking 13%, Rebel Sports falling 10%, BCF down 12% and Macpac down 10%.

Overall group sales declined 12%.

The company advised that excluding the major impacted markets of New South Wales and Victoria, group like-for-like sales in the first 16 weeks of FY22 was 6% lower than FY21 and 27% higher than FY20.

Online sales channel performance was encouraging, increasing 96% and representing 30% of overall group sales, year-to-date.

Click and collect sales also grew by 163%, outpacing home delivery and representing 59% of overall online sales.

So far in FY22, the company has maintained gross margin improvements achieved in FY21.

However, the trading update warned that ongoing freight and logistics costs associated with elevated levels of inventory could weigh on future gross margins.

Looking ahead, management said it was confident about the key cyber and Christmas trading period, with a “fortified inventory position across all four of its core brands”.

Management reiterated that the group was undertaking significant investment in its customer loyalty and data and analytics capability. The multi-year program is expected to have an impact on operating expenses in the first half and beyond.

Management commentary

Super Retail Group managing director and CEO Anthony Heraghty commented on the results, saying:

In FY22 year to date, we have maintained steady trading momentum in non-COVID impacted regions and we are confident that we will see a rebound in sales as lockdowns end and stores re-open.

As COVID-19 restrictions ease, we are looking forward to helping our customers celebrate by providing them with all of the products they need to resume travelling, playing sport and enjoying the great outdoors.

The group has a strong inventory position and is well placed to take advantage of the expected uplift in consumer demand in the auto, leisure and outdoor categories over the summer holiday period.

Super Retail share price snapshot

The Super Retail share price has been a solid performer so far in 2021, up 27.8% year-to-date.

Today’s lift puts it within arm’s reach of August all-time highs of $13.73.

The post Super Retail (ASX:SUL) share price climbs 3% on trading update appeared first on The Motley Fool Australia.

More reading

• Is the Super Retail (ASX:SUL) dividend yield really 11%?
• Here are 2 ASX dividend shares analysts rate highly
• Here are the top 10 ASX shares today
• Which ASX 300 shares are the biggest winners and losers on Thursday?
• Why Collins Foods, Pilbara Minerals, Sezzle, & Super Retail are pushing higher

Motley Fool contributor Kerry Sun 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 Super Retail Group Limited. The Motley Fool Australia owns shares of and has recommended Super Retail 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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The Australian Ethical Investment Ltd (ASX: AEF) share price is gaining some serious field position this week, having closed at its record high three consecutive days in a row now.

The Australian fund manager has benefitted immensely from a backdrop of positive retail investing trends and record inflows to its investment vehicles this quarter.

Read on for more details.

Australian Ethical charges higher on record fund inflows

As investing trends continue towards the inclusion of the retail crowd in the foreseeable future, capital continues pouring into Australian equity funds.

In fact, 2021 has been a record year for global equity markets as investors spill their hard-earned capital – or the government monies provided to them in response to COVID-19 lockdowns – into financial markets at a pace never seen before.

For instance, global equity fund inflows for the first half of 2021 were the highest on record. Just shy of $600 billion of investor capital moved into equity market funds around the world.

Australia was no different and the bulk of ASX listed funds and products gained in assets and market capitalisation during September as well.

The culmination of this enormous build-up in assets such as shares and derivatives in 2021 appears to have certainly carried over to Australian Ethical’s books.

It announced in its quarterly update that it had recorded an 8% increase in its funds under management (FUM) to an all-time high of $6.54 billion.

This growth was underscored by $160 million of cash inflows into Australian Ethical’s products. The company partially attributes this to its high net worth clients rolling over their positions. (It’s worth noting here that some investment products, like derivatives contracts, for instance, have expiry dates and need to be reinstated; or different positions require asset managers to adapt depending on market trends.)

With these underlying factors in place, it appears investors have rewarded the company this quarter.

Consequently, the Australian Ethical share price has rallied from $10.65 to $12.51 in the last week of trade after its Q3 fund flows update. At the time of writing, the company’s shares are trading at $12.56, up 0.4% on yesterday’s close.

The trading volume of Australian Ethical’s shares yesterday was also 37% higher than its 4-week average volume, indicating the demand to get a piece of the fund manager.

Australian Ethical share price snapshot

The Australian Ethical share price has climbed 151% this year to date, adding to its 173% in gains over the last 12 months.

Without question, this comes in ahead of the S&P/ASX 200 Index (ASX: XJO)’s return of around 19% in that time.

The post Why has the Australian Ethical (ASX:AEF) share price rallied 17% in a week? appeared first on The Motley Fool Australia.

More reading

• Australian Ethical (ASX:AEF) share price hits new high on record quarterly inflows
• 3 reasons why the Australian Ethical (ASX:AEF) share price could be a standout idea
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• 2 great ASX shares to consider

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Australian Ethical Investment Ltd. The Motley Fool Australia has recommended Australian Ethical Investment Ltd. 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 Kogan.com Ltd (ASX: KGN) share price has been a very strong performer on Wednesday.

In early trade, the ecommerce company’s shares are up 8% to $11.85.

Kogan share price jumps after Q1 update

The catalyst for the rise in the Kogan share price today has been the release of a trading update. Here are a few highlights:

• Gross sales grew 21.1% year on year and 23.2% quarter on quarter to $330.5 million
• Gross profit fell 1.7% year on year but grew 31.6% quarter on quarter to $52.5 million
• Kogan.com Active Customers grew 30.7% year on year and 4.5% quarter on quarter to 3,351,000
• Mighty Ape Active Customers fell 2.1% quarter on quarter to 748,000
• Kogan First members grew 171.1% year on year and 64.4% quarter on quarter to 197,000

What happened during the quarter?

During the quarter, Kogan advised that it focused on further scaling the Kogan Marketplace and Kogan First loyalty program, improving logistics and customer service, and driving synergies through the successful integration of Mighty Ape.

It notes that these initiatives underpinned growth in Kogan.com’s active customer base, cementing its position as one of the largest online shopping communities in Australia.

Kogan also revealed that it resolved previous inventory pressures and closed a number of inefficient overflow warehouses. This reduction in inventory levels led to the company significantly reducing its warehousing costs, delivering an average variable cost saving of $0.8 million per month during the quarter compared to the fourth quarter of FY 2021.

At the end of the period, the company’s inventory had reduced by 14.7% to $194.3 million. This comprises $154.2 million in its warehouse (down 20%) and $40.1 million in transit. Given how inventory concerns have been weighing heavily on the Kogan share price, this news will no doubt be welcomed by the market.

Management commentary

Kogan.com’s Founder & CEO, Ruslan Kogan, was very pleased with the quarter.

He commented: “When it comes to delighting our customers, we set a very high standard for ourselves, and I am proud of the way the Kogan.com team has continued to deliver on our mission of making the most in-demand products and services more affordable and accessible. While overcoming many challenges, the Kogan.com team has continued to deliver strong growth while investing in the future of the business and incubating new ways to deliver more value to our customers over the long term.”

The post Kogan (ASX:KGN) share price surges 8% higher amid strong Q1 sales growth appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• ASX 200 (ASX:XJO) midday update: Aristocrat’s $5bn acquisition, Zip falls on Q1 update
• Credit Suisse says the Kogan (ASX:KGN) share price has major upside
• Analysts name 3 excellent ASX growth shares to buy
• Why is the Kogan (ASX:KGN) share price struggling lately?

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 Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. 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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Income investors are always on the hunt for high-yielding shares. However, high yields don’t necessarily mean high overall returns. For example, sometimes high-dividend stocks can be misleading because of their high yield but depressed share price; this is known as a ‘fallen angel’. Regardless of how you look at them, we have put together a list of the 5 highest-yielding ASX 200 stocks based on dividend yield.

Perhaps to no one’s surprise, iron ore producers feature heavily in the highest yielding stocks in the S&P/ASX 200 Index (ASX: XJO). This is a product of mainly two predominant factors that have played out over the past year. Firstly, the soaring price of the steelmaking commodity in the first half of the year. Secondly — ironically — is the tumbling price of the same commodity since July.

We’ll cover this in more detail shortly, but now, let’s dive into the highest yielding stocks in the ASX 200.

High yielding ASX dividend stocks

Cromwell Property Group (ASX: CMW)

The first cab off the ranks is diversified real estate investor and manager, Cromwell Property Group. Some background on Cromwell — it holds nearly $12 billion in assets under management, with over 2,700 tenant customers. These property assets are spread across 15 countries with the majority of the spaces leased as office spaces.

At the time of writing, Cromwell offers a dividend yield of 8.2% based on the dividend payments made over the last 12 months. The annual dividend per share (DPS) has been declining since 2018, while the dividend yield has stayed between the 6% to 9% range. This is due to the fall in the Cromwell Property share price in recent times, which inflates the dividend yield.

BHP Group Ltd (ASX: BHP)

Next on the list of the highest yielding dividend stocks in the ASX 200 is Australia’s third-largest listed company, BHP.

A booming period for commodities meant the diversified miner experienced a bumper year for profits. In turn, the company unleashed a dividend bonanza on its shareholders. The increase in dividends paid out to shareholders increased ~150% year on year, bringing the dividend yield to 10.5%.

However, it is worth noting that this yielding has increased with the BHP share price collapsing ~30% from its highs on the back of the falling iron ore price.

AGL Energy Limited (ASX: AGL)

Another victim of declining DPS and surging yields is one of Australia’s oldest companies, AGL Energy. It seems the $4 billion electricity and gas provider couldn’t catch a break in the last 12 months as additional costs stacked higher and higher. Provisions for out-of-the-money renewable power-purchasing contracts and restoration of generations sites pulled AGL down to a $2.06 billion loss in FY21.

Despite the catastrophe, the company paid a total of 65 cents per share in dividends over the past year. Based on the current AGL share price, that equates to a dividend yield of 10.6%. Once again, this yield is boosted by the company’s share price tumbling 54.3% during the payment of those dividends.

Rio Tinto Limited (ASX: RIO)

That brings us to the second-highest yielding dividend stock in the ASX 200, Rio Tinto. Once again, following a common thematic of the cash-heavy iron ore producers, Rio Tinto has gone on a dividend splurge over the past 12 months.

With profits ballooning to US$18.8 billion, up from US$7.2 billion in the prior year, the mining giant had plenty of ammo to distribute large payouts to shareholders over the past 12 months. As a result, the company’s DPS for the last year stands at US$9.312. This equates to a dividend yield of 13% based on the current Rio Tinto share price.

Fortescue Metals Group Limited (ASX: FMG)

Finally, the highest yielding dividend stock in the ASX 200 is the fast-growing Aussie iron ore producer, Fortescue Metals.

Benefitting from the soaring iron ore prices in the first half of the year, the company chaired by Andrew ‘Twiggy’ Forrest grew its earnings by more than double the previous year. As a result, the company decided to increase dividends by a similar proportion, rising from US$1.403 to US$3.035 in the space of 12 months.

Unfortunately for shareholders, the Fortescue share price was the hardest hit out of the big iron ore producers, falling by nearly 50% over the last few months. As a result, the company’s dividend yield has been inflated to an astronomical 27.9% — making it easily the highest yielding dividend stock in the ASX 200.

The post These are the 5 highest yielding dividend stocks in the ASX 200 appeared first on The Motley Fool Australia.

More reading

• Own BHP (ASX:BHP) shares? Here’s how Twiggy is heating up competition for battery minerals
• Why the Fortescue (ASX:FMG) share price could be dirt cheap
• BHP (ASX:BHP) share price tumbles on Q1 update
• Why has the AGL (ASX:AGL) share price climbed 14% in a month?
• Why BHP, Propel, Silver Lake, and Tabcorp shares are falling

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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The Whispir Ltd (ASX: WSP) share price is on form on Wednesday morning.

At the time of writing, the cloud communications software company’s shares are up 8% to $2.32.

Why is the Whispir share price jumping?

Investors have been bidding the Whispir share price higher following the release of its first quarter update. Here are a few highlights from the quarter:

• Annualised Recurring Revenue (ARR) increased 31.8% year on year to $56.8 million
• 33 net new customers onboarded taking total customers to 834, up 25.4% year on year
• 12-month customer revenue retention of 117.2%
• Quarterly cash receipts up 55.7% year on year to $16.3 million
• Cash and equivalents balance of $43.9 million

What happened during the quarter?

Whispir had a solid quarter and delivered a 31.8% year on year or 6% quarter on quarter increase in its ARR to $56.8 million.

Management advised that this reflects the global megatrends of digitisation and digital transformation which are supporting increasing demand for communications intelligence.

This led to Whispir onboarding 33 net new customers during the quarter. Management notes that these customers were diverse in both regional and industry attributes and took its total customers to 834. This represents 25.4% growth over the prior corresponding period.

Pleasingly, the company also reported that its customers grow stickier over time, as reflected by its 12-month revenue retention of 117.2%. Management feels this highlights strong levels of product satisfaction and expects it to underpin Whispir’s future revenue.

Operating cash outflows increased by $2.4 million quarter on quarter to $2.9 million. This was broadly in line with the execution of the company’s growth strategy as it scales globally. Despite this increase, Whispir ended the quarter with a strong cash and equivalents balance of $43.9 million.

Whispir’s CEO, Jeromy Wells, commented: “Strategic investments across our product roadmap, sales, marketing and customer service continued during the Quarter as we onboard our new customers across ANZ, Asia and North America, while delivering better value for existing customers on the platform.”

“This is a strong Quarter of growth for Whispir and we’re seeing quality sales momentum across each of our regions. As COVID-related restrictions continue to ease, we’re anticipating a return of demand from customers in suppressed industries including transport and aviation. We are ramping up investment in the capability of our global team – which increased by more than 30 people over the quarter – to widen our competitive moat, improve speed to market, and over time, reduce the cost of customer acquisition,” he added.

What’s next?

Positively, Whispir has reaffirmed its FY 2022 guidance. It continues to expect ARR of $65.4 million to $70 million. This represents year on year growth of 22% to 31%.

Mr Wells concluded: “As our customer growth continues, delivering stronger recurring revenues for Whispir, we’re pleased to reaffirm our outlook for FY22. ANZ continues to deliver impressive results and we’re building momentum in North America and Asia. We anticipate continued growth in our pipeline across all markets where Whispir is well placed to support businesses with their digitisation and digital transformation agendas.”

The post Whispir (ASX:WSP) share price jumps 8% on solid Q1 growth 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 Whispir Ltd. The Motley Fool Australia has recommended Whispir Ltd. 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 Flight Centre Travel Group Ltd (ASX: FLT) share price is falling on Wednesday.

In morning trade, the travel agent giant’s shares are down over 1% to $22.44.

Why is the Flight Centre share price falling?

Investors have been selling down the Flight Centre share price today following the release of a trading update at its annual general meeting.

According to the release, during the month of September, Flight Centre’s sales reached 27% of pre-COVID levels globally.

As per previous updates, the corporate side of the business is improving at a much quicker rate. Its sales were at 41% of pre-COVID levels during the month, with leisure sales tracking at 14% of pre-COVID levels.

However, this wasn’t enough to make the company cash flow positive during the month. Flight Centre needs to achieve 50% and 40%, respectively, to reach breakeven within each of these divisions. In light of this, Flight Centre recorded a net operating cash outflow of $41 million for the period.

Management commented: “Cash outflows impacted by decreased revenue during ANZ lockdowns, seasonality (extended Northern Hemisphere summer holidays), removal of government subsidies & significant investment ramp-up ahead of anticipated surge in demand when borders reopen.”

In respect to quarterly sales, the company generated almost almost $1.6 billion in gross total transaction value (TTV) during the first quarter. This represents an 8% increase on its fourth quarter result, despite the quarter traditionally being a softer trading period.

Current trading

Not even management’s positive commentary on current trading conditions in Australia has been able to stop the Flight Centre share price from falling.

It advised that there are positive early signs in the domestic market, with a surge in enquiries and bookings growth in October.

In addition, the company advised that international leisure bookings have now surpassed domestic bookings in Australia for the first time since the start of the pandemic. They almost tripled between July and September. This is a big positive as its Australian leisure business is very heavily weighted towards international travel. In fact, international travel represented more than 80% of its pre-COVID total transaction value.

Overall, booking numbers this month have already surpassed the September total with more than a third of the month still to come.

But as promising as this is, it hasn’t been enough to keep the Flight Centre share price from falling today.

The post Flight Centre (ASX:FLT) share price falls following Q1 update 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. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel 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/2Z4ogJo