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The Sandfire Resources Ltd (ASX: SFR) share price is drifting in the red during morning trading, currently changing hands at $5.40.

Sandfire shares are on the move this morning after the company announced a key divestment of its holding in Adriatic Metals PLC (ASX: ADT).

Here’s what we know.

What was announced?

Sandfire advised it had appointed an investment banking syndicate to sell its stake in Adriatic Metals. The syndicate comprises Canaccord Genuity Group Inc, RBC Europe Ltd, and Stifel Nicolaus Europe Limited.

Specifically, it has appointed the bookrunners to arrange a secondary placement of “up to 34,600,780 CHESS depositary interests representing ordinary shares” in Adriatic.

This represents Sandfire’s entire holding in the company and signifies around 16% of Adriatic’s existing float.

The secondary placement offer will be at a price of $2.80 per share. This represents an approximate 16% discount on the company’s closing price on Tuesday.

Proceeds from the divestment will gross Sandfire a hefty sum of around $97 million. It will sell the shares to institutional investors on the investment banking syndicate’s pitchbook.

Regarding the particulars of what sellers may or may not do in the situation, Sandfire said:

In the event that the Seller determines to sell less than all of its shares in the Secondary Placing, the Seller has agreed that it will not, for a period of 90 days following the completion of the Secondary Placing, offer, sell or otherwise transfer any shares from their remaining shareholdings in the Company without the consent of Canaccord, RBC and Stifel.

Sandfire expects the bookbuild to close no later than 2pm (AEST) on 13 October, unless otherwise stipulated.

What does this mean for Sandfire’s share price?

The divestment follows an announcement 2 weeks ago from Sandfire. Then it announced it intended to raise around $322 million from an underwritten retail entitlement offer.

That offer was conducted at $5.40 per share. This was part of a $1.25 billion round that the company intended to help finance the purchase of the Minas De Aguas Teñidas (MATSA). The MATSA mining complex is located in Spain.

Sandfire purchased a US$1.86 billion stake. It financed the deal with a combination of equity capital, its own cash, and an existing debt facility of $897 million.

Sandfire’s divestment away from Adriatic will fortify the company’s balance sheet. The cash injection will equate to just under $100 million.

With this in mind, the net effect the sale will have directly on Sandfire Resources’ share price is not yet clear.

For reference, Adriatic Metals finished yesterday 4% higher at $3.33, and is up 43% this year to date.

Sandfire Resources share price snapshot

The Sandfire Resources share price has struggled this year to date, posting a return of 8% since 1 January. However, it has climbed 32.5% in the past 12 months, and rallied 4% this past week.

This comes in ahead of the S&P/ASX 200 Index‘s (ASX: XJO) return of about 20% in that time.

The post Sandfire Resources (ASX:SFR) share price fizzles after sale of Adriatic Metals stake appeared first on The Motley Fool Australia.

More reading

• Why has the Adriatic Metals (ASX:ADT) share price leapt 11% in a month?
• 2 ASX shares set to double in the next year
• Which shares are set to finish the week as the top movers on the ASX 300?
• Why Saxo Market’s Q4 outlook bodes well for ASX copper shares
• Why the Sandfire (ASX:SFR) share price is lifting 5% today

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 Pact Group Holdings Ltd (ASX: PGH) share price is plummeting on Wednesday morning. This comes after the packaging company provided an update on the sale of its contract manufacturing businesses.

At the time of writing, Pact Group shares are down a sizeable 15.7% to $2.90.

What did Pact Group update the ASX with?

Investors are heading for the hills, sending the Pact Group share price to an 8-month low following the company’s latest release.

In today’s statement, Pact Group advised it has ceased the sale process of its contract manufacturing businesses. The terminated deal was perceived to be unfavourable on the company’s terms.

Pact Group CEO and managing director Sanjay Dayal commented:

I have consistently advised shareholders we would sell the business if the sale process met our value hurdle. Continued market uncertainty and supply chain disruption arising from COVID-19 has created challenges in realising our expectation. At this time, we believe retaining the business delivers greatest value for our shareholders.

How has Pact Group performed in Q1 FY22?

While it has been a challenging year for the company, demand for most of its businesses has remained resilient. In particular, the Packaging & Sustainability and Materials Handling and Pooling segments have stayed afloat.

Pact Group noted that it has managed higher raw material and international freight costs.

However, the same cannot be said for its contract manufacturing segment, with demand weaker than expected. This is a result of continued COVID-19 lockdowns as well as lower margins due to rising input costs.

The company stated a further trading update will be delivered at its Annual General Meeting (AGM). The event has been rescheduled to take place between 17 November and 29 November 2021.

About the Pact Group share price

Over the past 12 months, Pact Group shares had accelerated almost 50% although today’s plunge pulls that figure back to 26%. Year-to-date, performance is up around 11%.

Pact Group commands a market capitalisation of roughly $1.03 billion and has approximately 344 million shares outstanding.

The post Why the Pact Group (ASX:PGH) share price is sinking 15% today appeared first on The Motley Fool Australia.

More reading

• Bank of Queensland (ASX:BOQ) share price tumbles 4% on FY 2021 results
• Bubs (ASX:BUB) share price rockets 17% on revenue growth
• Lovisa (ASX:LOV) share price falls on surprise CEO exit
• Why the Paladin Energy (ASX:PDN) share price is up 8% today
• Why the Transurban (ASX: TCL) share price is sliding on Wednesday

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

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The Bank of Queensland Limited (ASX: BOQ) share price is tumbling lower on Wednesday.

At the time of writing, the regional bank’s shares are down over 4% to $9.29.

Why is the Bank of Queensland share price falling?

Investors have been selling down the Bank of Queensland share price this morning following the release of its full year results.

For the 12 months ended 31 August, the regional bank reported an 83% increase in cash net profit after tax to $412 million. This was driven by a 13% increase in total income to $1.26 billion and its improving net interest margin (NIM).

The bank’s strong profit growth allowed the board to declare a fully franked final dividend of 22 cents per share, which brought its full year dividend to 39 cents per share. This is up more than 200% from FY 2020’s 12 cents per share dividend.

How does this compare to expectations?

Despite what the Bank of Queensland share price performance may indicate, this result was in line with expectations.

According to a note out of Goldman Sachs, its analysts were expecting cash earnings growth of 80% to $406 million, cash earnings per share of 66 cents, a NIM of 1.92%, and a final dividend of 22 cents per share.

This compares to the bank’s actual result of cash earnings of $412 million, cash earnings per share of 74.7 cents, a NIM of 1.95%, and a final dividend of 22 cents per share.

So why are its shares falling?

The weakness in the Bank of Queensland share price appears to have been driven by its outlook and particularly comments relating to its NIM.

Management advised that it expects its “NIM to decline by c.5-7bps in FY22, as competition continues and the low interest rate environment remains.”

However, it is worth noting that Goldman was forecasting such a decline. So, this could prove to be an overreaction by the market.

Goldman has a buy rating and $10.09 price target on the Bank of Queensland share price at present. Though, it has yet to respond to this results release and could amend its recommendation once it has run the rule over it.

The post Bank of Queensland (ASX:BOQ) share price tumbles 4% on FY 2021 results appeared first on The Motley Fool Australia.

More reading

• Bank of Queensland (ASX:BOQ) share price on watch after 83% cash profit jump
• 5 things to watch on the ASX 200 on Wednesday
• Here’s what happened to the Bank of Queensland share price in the FY22 first quarter
• Own Bank of Queensland (ASX:BOQ) shares? Here’s what to expect from its FY21 results
• Bank of Queensland (ASX:BOQ) share price hits 52-week high on Friday

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 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 Bubs Australia Ltd (ASX: BUB) share price is rocketing, up 17% in early trade to 42 cents per share.

This as the All Ordinaries Index (ASX: XAO) is down 0.2%.

Below we take a look at the company’s quarterly report for the first quarter of the 2022 financial year (Q1 FY22), which looks to be driving ASX investor interest.

Bubs share price surges on quarterly revenue leap

The Bubs share price is charging higher after the company reported a 96% year-on-year leap in gross revenue of $18.5 million for the quarter. Revenue was also up 45% from the previous quarter.

Breaking the revenue down, Bubs Infant Formula gross revenue was up 124% over Q1 FY21 and up 64% over the prior quarter. Revenue from its Adult Goat Milk Powder was up 100% year-on-year and up 61% quarter-on-quarter.

Bubs also reported a resurgence in its Chinse business, with a 156% year-on-year increase in revenue.

Overall international revenue was up 489% from Q1 FY21.

The company ended the quarter with a strong balance sheet, holding $28.3 million in cash as at 30 September.

What management said

Commenting on the results Bubs CEO Kristy Carr said:

Bubs has largely put the disruption and challenges of COVID-19 behind us, delivering a turnaround to high growth during the quarter as we revamped our business strategy in response to the rapidly changing market dynamics.

Importantly, there continues to be strong consumer demand for Bubs’ quality nutritional products in all key markets with solid performance across our core business segments…

Our global expansion strategy continues to advance with business entities and representation now established in New Zealand, China and North America… The first shipment of Aussie Bubs’ products arrived in the USA during the quarter and Bubs is now an official Walmart vendor, with the first online sales expected to be realised in October 2021.

Bubs share price could also be getting a boost from the fairly positive outlook the company provided.

Looking ahead, Bubs executive chair Dennis Lin added:

We are investing in our manufacturing capabilities at our facility in Victoria and have extended the Bubs family to have local representation in New Zealand, China and North America, as we continue to diversify our business model.

Having recovered the ground lost due to COVID-19 disruption, we expect to be able to sustain continued growth momentum, to the extent our go forward approach does not depend on a material improvement in the pandemic setting.

Bubs share price snapshot

The Bubs share price has struggled this year, down 30% in 2021. That compares to a gain of 9% posted by the All Ords.

Over the past month Bubs shares are up 8%.

The post Bubs (ASX:BUB) share price rockets 17% on revenue growth appeared first on The Motley Fool Australia.

More reading

• Why is the Bubs (ASX:BUB) share price leaping 7% on Tuesday?
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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 BUBS AUST FPO. 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 Lovisa Holdings Ltd (ASX: LOV) share price is under pressure on Wednesday morning.

At the time of writing, the fast fashion jewellery retailer’s shares are down 2% to $17.95.

Why is the Lovisa share price tumbling?

Investors have been selling down the Lovisa share price today after it announced the exit of its long serving Managing Director and Chief Executive Officer.

According to the release, Shane Fallscheer intends to step down from the role after 12 years leading the company.

The good news is that Lovisa has already secured a replacement. It has announced the appointment of Victor Herrero as its new Global Chief Executive Officer.

Mr Herrero is a highly experienced retail executive. For example, he previously spent 13 years at the Inditex Group. This is the retail giant behind popular brands including Zara, Pull & Bear, and Massimo Dutti.

During his time at Inditex, Herrero held numerous roles including Head of Asia Pacific and Managing Director Greater China and led the company’s expansion through the Asia region. This includes rolling out 800 stores across multiple countries including China and India.

In addition, Mr Herrero was the CEO of global retail brand Guess for four years until 2019 and most recently the Chairman and CEO of international shoe manufacturer and retailer Clarks.

Management commentary

Mr Herrero appears up for the challenge of running Lovisa.

He commented: “This is an amazing time to be joining the Lovisa business, and I look forward to continuing to drive it forward with the same passion and momentum that has gotten the business to where it is today. I would like to thank Shane for agreeing to help ensure a smooth transition and for his exceptional efforts to lead the company to its current strong position, and I look forward to the great opportunity we now have to further drive the company’s strategic goals.”

Lovisa’s Chair, Brett Blundy, was pleased with the appointment.

He said: “Shane’s decision has provided us with the opportunity to appoint an exceptional global retailer and we are excited to announce the appointment of Victor Herrero as Global CEO. Victor has an exceptional track record of driving global expansion and leading complex global retail businesses and will help us to move to the next stage of the global growth strategy of the Lovisa business.”

“Shane hands over the business in a very strong position and the Board is excited by the opportunity to continue the global expansion under Victor’s leadership, backed by his extensive global retail experience. Victor will commence in the role of Global Chief Executive Officer as soon as practical subject to current COVID restrictions, and we are pleased Shane and Victor are committed to ensuring a smooth transition,” Blundy added.

The post Lovisa (ASX:LOV) share price falls on surprise CEO exit appeared first on The Motley Fool Australia.

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• 2 compelling ASX shares that could be buys in October 2021

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 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 Paladin Energy Ltd (ASX: PDN) share price is booming on Wednesday, up 8.8% to 80 cents.

What’s driving the Paladin Energy share price?

Uranium ETFs boom overnight

The Global X Uranium Exchange Traded Fund (ETF) surged 11.65% to US$26.92, just 6% away from its mid-September all-time highs of $28.72.

This move comes off the back of its highest volume day in history, with over 6.1 million shares traded.

The uranium ETF is comprised of companies involved in uranium mining and the production of nuclear components, including those used for extraction, refining and exploration.

The ETF holds positions in ASX-listed uranium players including Paladin Energy and a handful of explorers including Bannerman Energy Ltd (ASX: BMN) and Boss Energy Ltd (ASX: BOE).

Tailwinds for uranium demand

According to Bloomberg, uranium “may extend this year’s uptrend as worsening power shortages bolster its allure as a potential alternative to fossil fuels”.

Uranium prices have cooled off to around US$40/lb after surging to a 9-year high of ~US$50/lb on 17 September.

Similarly, the Paladin Energy share price boomed from the mid-40 cent range in mid-August to a 9-year high of $1.12 on 16 September.

Bloomberg said that “more uranium producers and developers are seeking to build inventories and reactors with Bloomberg New Energy Finance (NEF) forecasting Asia will take the lead”.

“Inflows into uranium exchange-traded funds remain elevated and Asian miners look primed to benefit,” it added.

Hedge funds join the party

The Australian Financial Review (AFR) also reported that funds such as Ben Melkman’s New York-based Light Sky Macro, Anchorage Capital and Tribeca Investment Partners are bullish on the outlook for the energy metal.

How has the Paladin Energy share price performed?

The Paladin Energy share price is up 237% year-to-date thanks to the resurgence of uranium spot prices.

Its shares have pulled back sharply from mid-September highs of $1.12 but managed to consolidate around the low 70 cent range.

The post Why the Paladin Energy (ASX:PDN) share price is up 8% today appeared first on The Motley Fool Australia.

More reading

• Why ASX uranium shares are bouncing back on Friday
• Which ASX 300 shares are on the move for the start of the week?
• Which ASX shares are set to finish the week as the top movers on the ASX 300?
• How did ASX uranium shares perform in September?
• Why the Paladin Energy (ASX:PDN) share price is down 10% today

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 Transurban Group (ASX: TCL) share price is falling this morning following news the company has completed the final stage of its $3.97 billion entitlement offer.

The resulting funds will go towards the purchase of the remaining 49% of Sydney’s WestConnex. Transurban already has a 50% hold in the road network.

Transurban is part of a consortium – named Sydney Transport Partners (STP) – that’s buying the stake in the major road infrastructure from the NSW Government. The acquisition will cost the consortium $11.1 billion.

At the time of writing, the Transurban share price is $13.45, 0.81% lower than its previous close.

Let’s take a closer look at Transurban’s latest equity raise and its bolstered stake in WestConnex.

Transurban share price slips on finished capital raise

The Transurban share price is sliding lower this morning after the company announced it has completed its $3.97 billion entitlement offer.

The now-completed offer finished alongside its retail bookbuild, part of a retail entitlement offer that raised around $1.07 billion.

The company previously completed a $2.9 billion institutional entitlement offer.  

Under the retail entitlement offer, eligible shareholders could get their hands on Transurban shares for $13 apiece. Shareholders were able to purchase 1 new Transurban share for every 9 shares they owned as of 23 September.

The retail bookbuild saw around 28.6 million new Transurban shares sold for $13.30 each. The extra 30 cents will go to retail shareholders who didn’t act on the pro-rata offer or who were ineligible.

Transurban is also raising $250 million through selling shares for $13.07 apiece to AustralianSuper, a fellow member of the STP Consortium.

That brings the total amount raised by Transurban to $4.22 billion, as Transurban announced on 20 September. The Transurban share price was frozen as the company prepared to announce the capital raise. It fell 0.4% when trading resumed.

WestConnex will be a roughly 70-kilometre network connecting Sydney’s west with the city’s CBD, airport, and Port Botany. The network has more than 40 years of concession life left in it.

Transurban expects its increased stake in WestConnex will see it receive more than $600 million of potential capital releases until financial year 2025.

The post Why the Transurban (ASX: TCL) share price is sliding on Wednesday 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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The Challenger Ltd (ASX: CGF) share price is on the move on Wednesday morning.

At the time of writing, the annuities company’s shares are edging 0.5% higher to $6.37.

Why is the Challenger share price rising?

Investors have been bidding the Challenger share price higher today following the release of its first quarter update.

According to the release, Challenger’s Life sales were up 32% to $2.1 billion during the first quarter.

Challenger’s Managing Director and Chief Executive Officer, Richard Howes, advised that this was driven by its diversification strategy. He commented: “Strong quarterly sales growth highlights the success of our diversification strategy and reflects our focus on building relationships with institutional clients.”

This ultimately led to the Life business reporting net flows of $594 million, which underpinned book growth of 3.4% for the quarter.

Challenger’s annuity sales of $1.2 billion were stable and included strong growth in domestic annuity sales, which increased 17% or $143 million to $986 million.

Pleasingly, Mr Howes appears optimistic that this solid form can continue thanks to new product launches.

“Continuing to innovate has been a priority and we recently launched our new market-linked annuity for customers who seek the benefits of lifetime income, while maintaining exposure to investment markets. Benefiting from rigorous market testing, this option will form an attractive complement to our existing lifetime annuity offering,” he added.

Funds under management continue to grow

Also potentially giving the Challenger share price a boost was news that its funds under management (FUM) have continued to grow.

Management notes that Challenger’s Funds Management business is one of the fastest growing asset managers in Australia. The business delivered a strong performance for the quarter, with FUM increasing to $108.4 billion This was a $2.6 billion or 2% increase for the quarter.

This FUM growth reflects net inflows of $1.4 billion for the quarter, a $1.7 billion contribution from investment markets, and net distributions of $0.5 billion.

Bank acquisition

The company has now completed its acquisition of digital bank MyLifeMyFinance.

Management sees the acquisition as a key pillar of Challenger’s growth strategy. It believes it is now well positioned to increase the role it plays in improving retirement outcomes, extending its customer reach, and further diversifying its product offering to accelerate medium-term growth.

Outlook

In FY 2022, Challenger continues to expect to achieve strong profit growth.

It has reaffirmed its FY 2022 normalised net profit before tax guidance of between $430 million and $480 million. The mid-point of $455 million represents 15% growth on FY 2021.

The post Challenger (ASX:CGF) share price pushes higher on Q1 update appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday

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 Challenger 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 gap between the Zip Co Ltd (ASX:Z1P) share price and Afterpay Ltd (ASX: APT) share price could be set to widen.

This is because Citigroup downgraded Zip to “neutral” from “buy” as it cut its customer growth forecast.

The news is likely to weigh on the Zip share price, which is already lagging its bigger rival Afterpay.

Zip share price in the shadow of Afterpay

While the prospects of rising global interest rates have cast a cloud over the fast-growing sector, the Afterpay share price is still up by around 24% over the past year. In contrast, the Zip share price has slumped 14% in the red over the period.

Higher interest rates lower the valuation of ASX shares, particularly those trading at a big premium to the S&P/ASX 200 Index (Index:^AXJO).

That issue aside, Zip will find it harder to come out of the shadow cast by Afterpay after Citi’s recommendation cut.

Lower new customer growth

Citi analysed various Buy-Now Pay-Later (BNPL) players’ websites and mobile apps across key markets. The findings aren’t so good for Zip even though Citi expects increasing app usage to drive strong transaction volume growth in the US for the company.

“Zip’s app downloads were down for the sixth consecutive month in September,” said the broker.

“We have lowered US customer growth assumptions and forecast 4.957 million customers in the US in 1Q21, which assumes customer net adds of 520k in 1Q22e.”

This equates to a drop in customer net adds of 14% when compared to 4QFY21 when Zip recorded a figure of 608,000.

Other drags on the Zip share price

But this isn’t the only reason why Citi downgraded the Zip share price. It also increased its operating expenses forecasts for the company. This is to reflect increasing promotional activity, such as cashbacks, and geographical expansion.

Then there is the risk of a capital raise to the Zip share price. This should come as less of a surprise given the acquisitive fervour shown by management.

“With $462 million of cash available as of Jun’21, Z1P has ample balance sheet capacity to funds its growth, including the recent US$50 million investment in Indian BNPL operator ZestMoney,” added Citi.

“However, we do see potential need for an equity raise, especially if Z1P accelerates its international expansion strategy.”

The broker’s 12-month price target on the Zip share price drops to $7.40 from $7.95 a share.

The post Zip (ASX:Z1P) share price on watch after broker downgrade appeared first on The Motley Fool Australia.

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Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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 Propel Funeral Partners Ltd (ASX: PFP) share price could be a mover on Wednesday. This morning the company released its trading performance for the first quarter of FY22.

Propel Funeral Partners share price on watch as acquisitions kick in

Propel Funeral Partners announced that its performance for the 3 months ended 30 September was materially above the prior corresponding period (pcp). The strong performance demonstrates its resilience despite COVID-19 impacts.

Revenue increased 13% against Q1 FY20, underpinned by a record number of funerals in the quarter.

Total funeral volume growth was 10% above the pcp, including comparable funeral volume growth of 5%.

While the company couldn’t provide exact financial figures, it noted that average revenue per funeral remained resilient and in line with the pcp.

This is despite the impacts of extended lockdowns and strict funeral attendee limits across New South Wales, Victoria, and New Zealand during the quarter.

Propel achieved an operating earnings before interest, taxes, depreciation, and amortisation (EBITDA) of ~28%.

By comparison, its FY21 full-year results delivered operating EBITDA margins of 30.1%.

The Propel Funeral Partners share price has performed strongly this year following a steady stream of M&A.

Today’s quarterly performance includes contributions from its 3 acquisitions completed during Q2 FY21. It also includes a 2-week contribution from its recently announced acquisition of State of Grace Funerals.

Management commentary

Propel managing director Albin Kurti said:

Propel’s diversified network of funeral and related social infrastructure assets across Australia and in New Zealand has continued to deliver considerable financial resilience in the first quarter of FY22, despite COVID-19 impacts, and I thank our staff for their dedication to providing essential funeral and related services to local communities.

Hopefully extended lock downs, strict funeral attendee limits and travel restrictions will soon be behind us, enabling bereaved client families to grieve in a manner that they ordinarily would, surrounded by family and friends.

Propel Funerals Partners share price snapshot

The Propel Funeral Partners share has performed strongly in 2021, up 50% year to date, closing at $4.28 on Tuesday.

The post Propel Funeral (ASX:PFP) share price on watch after first quarter update appeared first on The Motley Fool Australia.

More reading

• Propel Funeral Partners (ASX:PFP) share price lifts 5% on acquisition news

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 recommended Propel Funeral Partners 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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