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The Althea Group Holdings Ltd (ASX: AGH) share price is surging higher today following the release of its first-half results. During late morning trade, the cannabis company’s shares are up 8.4% to an intraday high of 57.5 cents.

At the time of writing, the Althea share price has retreated slightly and is sitting at 56 cents.

Let’s take a closer look and see Althea managed during the first-half of the 2021 financial year.

How did Althea perform in the first-half?

The Althea share price is on the move after investors appear to be pleased with the company’s latest result.

According to its release, Althea delivered a robust performance underpinned by business growth across Europe and North America.

For the six months ending 31 December 2020, Althea reported total revenue of $5,098,000. This represented an increase of 175.3% on the prior corresponding period (pcp). The strong sales came from the company’s growing market share of the Australia and United Kingdom medicinal cannabis sector.

Althea revealed a loss from ordinary activities after providing income tax of $8,274,000. This reflected a fall of 0.9% over the comparable period. While the bulk of the expenses was attributed to employee costs ($5,250,000), the company also made a foreign exchange loss of $1,529,000.

At the end of the calendar year, Althea had a cash balance of $8,644,000. A significant drop from the $22,361,000 recorded in the prior year.

Althea segment overview

Australia

Althea stated that in its biggest market, it is continuing to see sales growth of its medicinal cannabis products. This is due to the company developing the Healthcare Professional (HCP) prescribing community through its infield sales team and Althea Concierge platform.

As a result of the strategy, HCP and patient numbers soared in the first half. Althea recorded 12,273 patients at the end of 2020, tripling the figure from the year before. In addition, 834 HCP prescribed the company’s products to patients, doubling the amount achieved in the prior corresponding period (pcp).

United Kingdom

Identified as an emerging market, Althea revealed that sales jumped to $209,706, a 90% jump from November to December 2020. The positive momentum was driven by the company’s infield sales team efforts to educate and onboard additional prescribing specialists.

Canada

Across the Atlantic, Althea’s wholly-owned subsidiary, Peak Processing Solutions has been making tailwinds within the Canadian market. Following the Standard Processing Licence received in September 2020, the company signed contracts worth CAD$4.65 million to supply cannabis products. Executed in November last year, the deals will run for a period of 12 months.

A further agreement was also entered in December with The Tinley Beverage Company for manufacturing and distributing three cannabis-infused beverages. This will be targeted toward the adult-use cannabis market in Canada.

Germany

Althea has commenced operations following the approval of the necessary sale and distribution licences from Germany’s health regulator (BfArM). So far, the company has shipped an initial order of 2,000 units valued at around $1 million to a local partner, Nimbus Health GmbH.

Althea will adopt the same strategy used in other markets, incorporating its infield sales team with Althea Concierge. The final stages of planning is currently underway.

Words from the Althea CEO

Althea CEO Joshua Fegan touched on the company’s first-half result, saying:

I am very proud of our Australian and UK teams for producing record revenue in the second half of 2020. Generating market leading sales at the same time as scaling the business for growth throughout Europe and North America, requires a solid team of qualified and dedicated people. The Company has recruited well across all strategic business units and remains on track to deliver on its corporate objectives.

The Althea share price has accelerated to more than 80% over the last 12 months.

More reading

• Here’s why the Althea (ASX:AGH) share price is racing 8% higher today
• What will Elite Cannabinoids mean for ASX cannabis shares?
• How did ASX cannabis shares perform in 1H FY21?
• Here’s why the Althea (ASX:AGH) share price is jumping 7% today
• Why the Althea (ASX:AGH) share price has zoomed up 9% today

Motley Fool contributor Aaron Teboneras 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 share price of Atlas Arteria Group (ASX: ALX) is being driven lower after the toll road business announced its FY20 result.

Atlas Arteria is a global owner, operator and developer of toll roads. It has operations in France, the US and Germany.

FY20 result

The toll road business reported that its underlying net profit after tax fell by 61% to $69.6 million. However, the statutory net loss after tax declined 468% to $55.8 million due to a number of notable items.

Those items included a $143.9 million impairment of the Dulles Greenway, a $13.8 million non-cash foreign exchange gain and a final management fee of $2.1 million paid to Macquarie Group Ltd (ASX: MQG).

The France APRR toll road group total traffic (in vehicle kilometres travelled terms) saw a decline of 21% to 19,413 million during the year. APRR toll revenue fell 17.1% to €2.1 billion, earnings before interest, tax, depreciation and amortisation (EBITDA) fell 20.2% to €1.55 billion and net profit declined 28.2% to €628.3 million.

The Warnow Tunnel saw a 7.7% drop in total traffic to 4.56 million. Toll revenue fell 6.5% to €12.7 million and EBITDA dropped 11.6% to €9.1 million.

In the US, the Dulles Greenway saw a 42.7% drop in total traffic to 10.2 million. Toll revenue declined 42.3% to US$51.6 million and EBITDA sank 47.9% to US$38.4 million.

Atlas Arteria said that traffic in all jurisdictions was impacted by COVID-19 movement restrictions but recovered strongly in Europe as restrictions eased, while traffic at Dulles Greenway remained subdued.

Distribution

After paying a $0.11 per security distribution for the first half of FY20, it has given guidance of $0.13 per security for the second half of FY20.

Strategic objectives

The business said that it successfully increased its ownership interest in APRR from 25% to just over 31%, increasing the share of profits and enhancing the governance rights.

Atlas Arteria also said that it has reached contractual close for a new capital structure at the Warnow Tunnel in February 2021, which diversifies the sources of cashflow. Management said that the new arrangements are more capable of supporting the ongoing success of the business and allow for an optimised cash management strategy, resulting in the company having the ability to distribute free cash to Atlas Arteria, rather than being “swept” to lenders.

It also opened up the US market as a future source of institutional capital through a buyback of US retail securityholders.

Atlas Arteria share price movements

Atlas Arteria shares have been sliding in recent times. After almost reaching $7 in November 2020, the Atlas Arteria share price has dropped 20% since then.

Commentary from the CEO

Atlas Arteria CEO Graeme Bevans spoke of the business’ financial position for whatever comes next:

Although we are still in uncertain times, Atlas Arteria’s balance sheet is very well positioned. Our corporate costs will be higher in 2021 with increases in insurance costs a particular driver and some investment in capability to unlock value from our existing businesses. We currently have no corporate debt, ample liquidity, strong cash flows from APRR and Warnow Tunnel and are well placed to face the uncertainties of 2021 and pursue growth opportunities as they arise.

More reading

• Why the a2 Milk (ASX:A2M) share price is crashing 20% to a multi-year low
• Up 230%! What’s going on with the Peppermint Innovation (ASX:PIL) share price?
• The Regis Resources (ASX:RRL) share price is dropping 6%. Here’s why
• The Bravura (ASX:BVS) share price is rocketing after its latest results
• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie 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 worst performer on the S&P/ASX 200 Index (ASX: XJO) on Thursday has been the A2 Milk Company Ltd (ASX: A2M) share price.

In morning trade the fresh milk and infant formula company’s shares dropped as much as 20% to a multi-year low of $8.33.

When its shares hit that level, it meant they were down a very disappointing 45% over the last 12 months.

Why is the A2 Milk share price sinking?

Investors have been heading to the exits in their droves on Thursday after a2 Milk released its half year results.

For the six months ended 31 December, the company posted a 16% decline in revenue to NZ$677.4 million and a 32.2% decline in earnings before interest, tax, depreciation and amortisation (EBITDA) to NZ$178.5 million.

This was driven by weakness in the daigou and cross-border e-commerce (CBEC) channels. These channels have been significantly impacted due to disruption resulting primarily from COVID-19.

However, as poor as this might look on paper, it was actually in line with its downgraded guidance. Management was aiming for first half revenue of ~NZ$670 million and an EBITDA margin of ~27%. Excluding the impact of its acquisition of Mataura Valley Milk, a2 Milk’s EBITDA margin would have been in line at 27%.

In light of this, investors may be wondering why the a2 Milk share price is being hammered today. The reason for this is the company’s outlook.

Outlook

Despite only downgrading its FY 2021 guidance on 18 December, management has been forced to do it again today.

This has been driven by the company once again failing to correctly estimate the pace of recovery in the daigou and CBEC channels.

Management is now forecasting FY 2021 revenue of ~NZ$1.4 billion with an EBITDA margin of 24% to 26% (excluding acquisition costs).

This compares to its December guidance range of NZ$1.4 billion to NZ$1.55 billion with an EBITDA margin of 26% to 29%.

Though, it has warned that this guidance assumes that actions it is taking to reactivate the daigou channel deliver a significant improvement in quarter-on-quarter growth in the fourth quarter.

Judging by the a2 Milk share price performance today, it seems as though some investors are concerned that this guidance may also be downgraded in the future.

More reading

• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn
• a2 Milk (ASX:A2M) share price on watch after downgrading guidance again
• 5 things to watch on the ASX 200 on Thursday
• What does Citi think about ASX reporting season so far? 
• 6 high profile ASX 200 shares reporting results this week 

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended A2 Milk. 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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Peppermint Innovation Ltd (ASX: PIL) shares are up an eye-catching 227% today. The Peppermint share price opened at 3.3 cents this morning and is currently trading at 3.6 cents. Earlier in the day, Peppermint shares were as high as 4.3 cents, which represented a 291% gain.

Now although this looks like a stunningly good move today that you might think has made several millionaires, the story is a little more nuanced than it first appears. Firstly, it’s important to note that today is the first day in quite a while that this company’s shares have been actually available for trading. The stock has been in a hiatus for a long time, around 1½ years to be precise.

Peppermint shares were last traded on the ASX back in October 2019. Since then, they have been in the deep freeze. Prior to its trading halt, the company had a rather painful history. The Peppermint share price had its zenith way back in October 2009 when it reached a high of 37 cents, but has been in a downward spiral ever since.

In fact, between October 2009 and October 2019, Peppermint shares lost 97.3% of their value. Even after today’s moves, that loss is still sitting at around 90%.

The company’s shares closed at 1.1 cents a share back in 2019 and are now at 3.6 cents after the resumption of trading. That’s why we are seeing this seemingly-massive jump today. 

What is Peppermint Innovation?

Peppermint Innovation operates a mobile banking platform that facilitates payments and remittance. It can be used by other clients to offer services in this ilk. Currently, apps that run through Peppermint’s platform include Bizmoto, UCBP and Bank of Mataki. These apps are mostly based in the Philippines.

According to the company, Peppermint was suspended from the ASX in 2019 “due to a disclaimer of opinion in Peppermint’s annual financial report for the financial year ended 30 June 2019”. However, in a letter to the ASX seeking reinstatement, Peppermint’s chair Anthony Kain claimed that “Peppermint has continued to build its platform and business” regardless.

The company has since performed a capital raise of $2 million and delivered a quarterly update for the quarter ending 31 December 2020. In that update, Peppermint reported cash receipts of $540,000 for the quarter and $2.9 million for the 2020 calendar year. That was up from $1.65 million for 2019.

In the same update, Peppermint’s CEO Chris Kain stated the following:

I am very excited for what the next 12 months holds for Peppermint Innovation… We saw our business expand significantly, achieving a 76% increase in overall cash receipts in CY ’20 on CY ’19… The next 12 months will be extremely exciting for Peppermint as we continue to evolve the bizmoto platform and seek further opportunities for our established and proven mobile banking platform.

Judging by the rather successful Peppermint share price performance today, it seems investors agree.

More reading

• The Regis Resources (ASX:RRL) share price is dropping 6%. Here’s why
• The Bravura (ASX:BVS) share price is rocketing after its latest results
• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn
• Temple & Webster (ASX:TPW) share price sinks 8% despite 550% profit increase
• The Life360 (ASX: 360) share price rips 18% higher on strong results

Motley Fool contributor Sebastian Bowen 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 Regis Resources Ltd (ASX: RRL) share price is falling today, down 6% in late morning trade. At the time of writing, the share price has recovered slightly, trading at $3.14, down 5.14%.

We take a look at the ASX miner’s financial results for the half-year ending 31 December (H1 FY21).

What results did Regis Resources report for H1 FY21?

The Regis Resources share price is dropping after the company reported a net profit after tax (NPAT) of $84.8 million. Down 9.2% from the $93.4 NPAT reported in H1 FY20.

The company sold 72,990 ounces of gold at an average price of $2,317 per ounce, reporting revenue for the half-year of $401.0 million. That’s up 8% from the $371.4 million of revenue in the previous corresponding period (pcp).

Earnings before interest, taxes, depreciation and amortisation (EBITDA) came in at $198.6 million, up 7% year-on-year.

Regis reported a strong balance sheet with $147.8 million in cash flows from its operating activities. Additionally, it reported cash and bullion of $220.0 million as at 31 December (and using that date for the gold price).

The company produced 172,977 ounces of gold during the half-year at an all-in sustaining cost (AISC) of $1,356 per ounce.

Management Commentary

Commenting on the results, Regis managing director, Jim Beyer, said:

Regis has again delivered another solid profit result with a half-year profit after tax of approximately $84.8 million and operating cash flows of $147.8 million. A net profit margin of 21% and robust operating cash flows for the half-year continue to point to the strength of the Duketon operations.

During the half-year, the board approved the development of the Garden Well underground mine. This will become the second underground mine at the Duketon operations. Indeed, it will be a welcome addition to Regis’ production profile once developed.

Regis will pay an interim dividend of 4 cents per share (cps), fully franked, with an ex-dividend date of 10 March and payable on 25 March.

Regis Resources share price snapshot

The Regis share price has struggled to hold onto the strong gains it posted following the broader ASX recovered from last year’s COVID-fuelled market selloff. Over the past 12 months, Regis shares are down 30%, compared to a 0.5% loss on the S&P/ASX 200 Index (ASX: XJO).

Year-to-date the Regis share price is down 18%.

More reading

• The Bravura (ASX:BVS) share price is rocketing after its latest results
• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn
• Temple & Webster (ASX:TPW) share price sinks 8% despite 550% profit increase
• The Life360 (ASX: 360) share price rips 18% higher on strong results
• Southern Cross Media (ASX:SXL) share price falters despite increased profits

Motley Fool contributor Bernd Struben 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 Bravura Solutions Ltd (ASX: BVS) share price is climbing strongly this morning after the company announced its half-year report. Shares in the financial services provider are rising to a price of $2.89, increasing by 7.04%.

The release comes as the Bravura share price has fallen sharply in recent times, down 17% this year.

What Happened?

This morning the Bravura share price is rocketing higher as the company announced its 1H21 results. Shareholders have been bidding up the wealth managements share price as the company hit guidance.

Despite the impacts of the ongoing pandemic, Bravura posted a net profit after tax (NPAT) of $9 million. This came as group revenue fell 14%, to $115.7m. Moreover, earnings before interest, tax, depreciation and amortisation also fell sharply. Falling by 38% to $15.8 million.

However, despite the sharp decline in key metrics above Bravura retained a strong financial position with $56.4 million in cash.

Management Comments

Commenting on the group performance, Mr. Klim, chief executive officer, said:

Bravura’s 1H21 results are broadly in line with guidance and reflect the unprecedented impact of COVID-19, particularly on UK project work and the sales pipeline. Despite the impact, we have responded to changing market conditions and evolved Bravura’s strategy to stay well ahead of client needs. This will lead to greater flexibility for clients in the speed of their implementation and will help them smooth their IT spend. In doing so, Bravura also expands its total addressable market and moves towards a higher proportion of contracted recurring revenue.

Outlook for Bravura

Looking forward, Bravura outlined some key drivers for the business moving forwards. Importantly, the company claims it is starting to see increased market confidence as a result of vaccine rollouts in the UK. With the rollout, it anticipates a resumption in UK and South Africa demand in FY22 from projects postponed due to COVID-19. 

Regarding the company’s guidance, the pandemic is expected to continue to affect the business in 2H21. However, the sales pipeline is strong. Accordingly, Bravura anticipates delivering revenue growth in excess of 10%. While achieving FY21 NPAT of A$32m to A$35m.

More reading

• ASX 200 Weekly Wrap: ASX cools on earnings reality check
• These were the worst performing ASX 200 shares last week
• 3 stellar ASX growth shares to buy today
• Goldman Sachs names 2 growing ASX dividend shares to buy
• Two of the best ASX dividend shares to buy in February

Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Bravura Solutions Ltd. The Motley Fool Australia has recommended Bravura Solutions 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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At lunch on Thursday the S&P/ASX 200 Index (ASX: XJO) is back on form and charging higher. The benchmark index is currently up 0.85% to 6,836.4 points.

Here’s what is happening on the market today:

A2 Milk share price sinks

The A2 Milk Company Ltd (ASX: A2M) share price is sinking heavily today following the release of its half year results. Although the infant formula and fresh milk company delivered a first half result in line with expectations, it doesn’t expect its second half performance to be strong enough to achieve its full year guidance. As a result, it has downgraded its already downgraded full year guidance. It now expects revenue of ~NZ$1.4 billion and an EBITDA margin of 24% to 26%. Its previously downgraded guidance was for revenue of NZ$1.4 billion to NZ$1.55 billion with an EBITDA margin of 26% to 29%.

Afterpay half year results

The Afterpay Ltd (ASX: APT) share price isn’t going anywhere today after requesting a trading halt. This is so the payments company can undertake a $1.25 billion notes offering to fund the buyback of equity in its Afterpay US business. In respect to its results, Afterpay reported a 106% increase in underlying sales to $9.8 billion and a 108% jump in total income to $374.2 million. However, the company didn’t post a maiden profit as some had expected. Instead, it reported a loss after tax of $79.2 million.

Zip share price hammered

The Zip Co Ltd (ASX: Z1P) share price has been hammered on Thursday following the release of its half year results. For the six months ended 31 December, Zip reported a 141% increase in total transaction volume (TTV) to $2.32 billion. This underpinned a 130% jump in half year revenue to $160 million. Investors appear to have been expecting a stronger result.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday has been the Nanosonics Ltd (ASX: NAN) share price with an 8% gain. This morning analysts at Morgans upgraded its shares to an add rating with a $6.69 price target. The worst performer has been the a2 Milk share price with a 14% decline following its half year update.

More reading

• Sandfire (ASX:SFR) share price hits year high on profit result and supercycle hopes
• Zip (ASX:Z1P) share price on watch with 130% revenue growth in HY21
• Afterpay (ASX:APT) delivers more explosive growth and launches $1.25bn notes offering
• a2 Milk (ASX:A2M) share price on watch after downgrading guidance again
• 5 things to watch on the ASX 200 on Thursday

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 Nanosonics Limited and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Nanosonics 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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Temple & Webster Group Ltd (ASX: TPW) shares are plunging this morning, despite the company reporting massive growth in its FY21 first-half results. At the time of writing, the Temple & Webster share price is sinking 8.07% to $9.45.

Let’s take a look at what the online furniture and homewares retailer reported.

Temple & Webster share price fails to respond

The Temple & Webster share price is languishing today despite the company delivering huge growth across key metrics. Judging by the online retailer’s results, it seems many people were busy upgrading their home furnishings during the pandemic. With more people working from home, many were keen to refresh the environment in which they were spending most of their time.

Add to this the increasing shift away from bricks and mortar retailers to online shopping, and Temple & Webster has had all the ingredients for a booming half. The company’s results reflect just that, with top-line revenue growth of 118% to $161.6 million. All categories, geographies, channels, and demographics experienced strong growth during the period.

Hold onto your seats for this one. Earnings before interest, tax, depreciation, and amortisation (EBITDA) grew an astounding 556% to $14.8 million. Consequently, the additional cash generation has flowed into the company piggy bank, with cash increasing from $38.1 million at the end of June, to $85.7 million by the end of December.

If you’ve seen a Temple & Webster ad on TV recently, that was all part of a $20.7 million effort to increase brand awareness. With a 102% increase in active customers year over year to 678,000, it appears to have paid off.

The company’s efforts were rewarded on the bottom line as well. Net profit after tax increased from $2.9 million to $12.2 million, giving the business a 7.5% profit margin.

What’s next?

According to Temple & Webster, its future looks bright. The company noted that millennials are beginning to enter its core demographic age range. Additionally, many shoppers have formed new online habits as a result of lockdowns.

Temple & Webster highlighted the second half is off to a great start. Revenue growth was reported to be 118% year over year to 23 February.

Impressively, the Temple & Webster share price has returned more than 170% to shareholders over the last 12 months. 

Based on the current Temple & Webster share price, the company has a market capitalisation of around $1.24 billion.

More reading

• These ASX retail shares are smashing sales expectations
• 3 reasons why the Temple & Webster share price could be a buy
• ASX retail shares show strong signs of resurgence 
• Here’s a bargain ASX share in a sea of expensive stocks
• 3 great ASX tech shares to buy

Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Temple & Webster Group Ltd. The Motley Fool Australia has recommended Temple & Webster Group 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 Life360 Inc (ASX: 360) share price has ripped 18.48% higher into near-record territory following a well-rounded CY20 performance. 

At the time of writing, the Life360 share price is trading at $4.68 cents.

Strong growth pushing the Life360 share price higher 

Life360 operates a simple to use app developed for families with features that range from communications to driving safety and location sharing. 

In the calendar year, the app made more than 2 million help alerts, covered 52 billion miles of driving with its Life360 crash detection, dispatched more than 14,000 ambulances and made 11 billion safe arrival notifications. 

CY20 proved to be a resilient period in the face of COVID-19. The company continued to focus on building and monetising its user base, with a 39% year-on-year increase in normalised revenue to US$81.6 million, at the upper end of its guidance of US$79-82 million.

The company saw a solid reduction in its underlying earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $16 million, down 44% on the pcp. 

The app recorded 26.5 million monthly active users, near pre-COVID levels of 27.2 million in 2H19. 

Life360 and Google collaboration 

Life360 has rolled out a new feature in Australia, the United States and the United Kingdom, allowing families to get an easy update on their members’ whereabouts by creating a free Life360 account.

This brings together Life360’s leading family coordination services to Google Assistant-enabled devices, including Nest smart speakers, smart displays, Android and iOS phones. 

Randi Zuckerberg appointment

On 20 January 2021, the Life360 share price surged 12% on the announcement that Randi Zuckerberg was appointed as an independent non-executive director. 

She has created award-winning content and experiences that educate families and bring to light issues around digital literacy and safety.

Ms Zuckerberg said:

Similar to what we saw in the early days of Facebook, there’s a strong need for people to connect with a more intimate group – and Life360 offers that intimacy for families and so much more.

It’s exciting to see its success in the family safety space, and I can’t wait to use my experience as a product marketer, content creator and a mother to help the company reach its full potential.

Growth strategy moving forward 

Life360 will focus on three core pillars: building its user base, growing paid membership and expanding reach. 

To build its user base, the company has invested heavily in the free user experience to attract users and stay ahead of the competition. The company has also focused on evolving its brand image from a tracking app or ‘where are you’ to a concept of ‘independence’ and “how are you”. 

The platform’s membership offering is still in its early days. Its new initiatives will aim to improve awareness, conversion and retention of membership offering. 

Finally, the company intends to launch new verticals to expand its reach and revenue potential. This includes options such as hardware devices, elder care and family financial services in the future.  

FY21 outlook 

While there are continuing risks to the company’s revenue streams, it continues to experience organic growth in core subscription revenue. Life360 anticipates that by December 2021, the company will be delivering an annualised monthly revenue in the range of US$110-120 million, a 23% to 34% year-on-year growth rate. 

The company also noted that given current valuations in the US for high growth technology companies, it had received inbound interest that could result in an accelerated listing/dual listing on a US exchange, the acquisition of a strategically important business and/or a merger with a larger entity. 

More reading

• 2 exciting ASX tech shares to buy today

Motley Fool contributor Kerry Sun 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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Southern Cross Media Group Ltd (ASX: SXL) shares have fluctuated in morning trade on the back of the group’s half-year results, which include an astonishing 59.3% rise in net profit.

After opening the day up by more than 2%, the Southern Cross share price is now down 2.47% to $2.37 as investors digest the group’s latest numbers.

What did Southern Cross Media report?

The media group declared a net profit after tax (NPAT) of $32.5 million, almost 60% higher than the $20.4 million profit declared for the prior corresponding period (pcp). The company attributed this growth to a leaner operating model and historically low debt levels.

While revenues were down 15.9% on the pcp, this was offset by a 23.6% expense reduction.

Earnings before interest, tax, depreciation and amortisation (EBITDA) was up 11.5% on the pcp – to $75.3 million.

The group also advised that, subject to no adverse changes in advertising markets, it intends to pay a final dividend for the 2021 financial year. The decision on final dividend will be announced when Southern Cross reports its full-year results in August.

Who is Southern Cross Media?

Southern Cross Media broadcasts programmed content on free-to-air commercial radio, television, and online media platforms across Australia.

The company has 100 radio stations and 105 TV signals in both regional and metropolitan markets. It generates about 70% of its advertising revenue from radio and 30% from television.

Words from the CEO

Southern Cross CEO Grant Blackley gave the following comments on the announcement:

Advertising markets are continuing to improve towards pre-COVID levels as the economy recovers and government restrictions stabilise and ease. Our Q3 revenue is forecast to be between 6% and 8% below the pcp while costs for the full year will reflect the benefits of work done over the past few years to restructure our business.

Blackley added:

We have revitalised our key Breakfast radio shows, led by The Morning Crew with Hughesy, Ed, and Erin on 2DAY FM in Sydney, The Marty Sheargold Show on Triple M Melbourne, and Basil, Xav, and Jenna on our new Triple M station in Perth. This investment is critical to unlocking higher audiences, revenues and earnings.

The poisoned chalice of Sydney breakfast radio

When ratings super magnets Kyle and Jackie O left 2Day FM in 2013 for new venture KIIS 1065, 2Day FM plummeted from the top of the Sydney ratings to near the very bottom. At one point the station reached a low of 2.8% audience share for the time slot.

A cavalcade of hosts over the years came and went as Southern Cross searched for that winning formula again. At first the station went to well-known names Jules Lund, Mel B, and Merrick Watts – before later replacing Mel B with Sophie Monk.

The ill-fated Dan and Maz show later replaced them, only to be themselves succeeded in 2015 by Rove McManus and Sam Frost.

In 2017 Southern Cross Media replaced Rove and Sam with comedians Harley Breen and Em Rusciano. The media company abandoned breakfast programming altogether in favour of music-focused programming in 2019.

The group will no doubt be hoping the new formula of Dave Hughes, Ed Kavalee, and Erin Molan can find success in the fiercely competitive and valuable Sydney breakfast radio market.

Southern Cross share price snapshot

After reaching a low of 11 cents per share in April 2020 – at the height of COVID-19 pandemic – Southern Cross Media shares rocketed in November 2020 from 16 cents to a high of $2.65 by the end of the month. That’s an eye-watering 1,656% increase!

The Southern Cross share price opened today at $2.43 and has since dropped to $2.37 at the time of writing.

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The post Southern Cross Media (ASX:SXL) share price falters despite increased profits appeared first on The Motley Fool Australia.

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