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Coca-Cola Amatil Ltd (ASX: CCL) shares are on the rise this morning following an update from the soft drink giant. At the time of writing, the Coca-Cola share price has jumped 1.98% to $13.39.

What’s driving the Coca-Cola Amatil share price?

The Coca-Cola share price is on the move this morning after the company announced Coca-Cola European Partners PLC (NYSE: CCEP) has increased its offer price to independent shareholders to acquire all Coca-Cola Amatil independent shares.

In an announcement released this morning, it was reported that CCEP has revised the original offer made in its scheme implementation deed on 4 November, upping the cash per Amatil share from $12.75 to $13.50.

CCEP has stated that this 5.9% increase to its original total cash consideration will be its best and final offer to Coca-Cola Amatil’s independent shareholders. CCEP noted that the new proposal also represents a 35% premium to the undisturbed average broker 12-month price target for Amatil shares.

Amatil’s Related Party Committee (RPC) and Group Managing Director Alison Watkins unanimously recommended that shareholders vote to support the new offer, providing no superior offers emerge and subject to the usual conditions being met.

Commenting on the offer, Coca-Cola Amatil Chair Ilana Atlas said:

The economic outlook for Australia and New Zealand has improved since the announcement of the original CCEP proposal and recent trading validates our strategy and demonstrates our strong recovery. The value of Amatil has increased and we are pleased that CCEP has acknowledged this in increasing its proposed cash consideration to Independent Shareholders.

The RPC and the Group Managing Director unanimously consider that the Revised Scheme, including the revised price, is in the best interests of Independent Shareholders.

Company snapshot

Coca-Cola Amatil is the authorised bottler and distributor of The Coca-Cola Company’s beverages in Australia and five other Asia Pacific regions. The company has a market capitalisation of around $9.5 billion and pays an annualised dividend yield of 2.7%, unfranked.

The Coca-Cola share price moved sharply higher following the original takeover offer from CCEP in October and shares have continued to slowly trend higher since then.  Over the past six months, Coca-Cola Amatil shares are up 51%. That compares to a 13% gain on the S&P/ASX 200 Index (ASX: XJO).

Since this time last year, the Coca-Cola Amatil share price is up 13% compared to a 4% fall on the ASX 200.

More reading

• Why the Coca-Cola Amatil (ASX:CCL) share price is pushing higher
• These blue chip ASX shares just hit multi-year highs
• Why the Coca-Cola Amatil (ASX: CCL) share price is in focus today

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 Creso Pharma Ltd (ASX: CPH) share price has been a strong performer on Monday morning.

At one stage today, the cannabis company’s shares were up as much as 11% to 25 cents.

The Creso Pharma share price has since pulled back a touch but remains 4.5% higher at 23.5 cents.

Why is the Creso Pharma share price racing higher?

Investors have been buying Creso Pharma shares after it announced its expansion into the Pakistan market.

According to the release, the company has signed a comprehensive distribution agreement with leading nutritional supplements company, Route2 Pharm.

The agreement will see Route2 Pharm import, market, distribute, and sell the company’s hemp derived therapeutic products exclusively into Pakistan and The Philippines. Route2 Pharm will also have non-exclusive rights to other potential target markets including Cambodia, Afghanistan, Azerbaijan, Bangladesh, Georgia, the Maldives, Myanmar, Tajikistan, Turkmenistan, Uzbekistan, and Vietnam.

The release explains that Route2 Pharma is a subsidiary of Route2Health. It has over thirty years of pharmaceutical sciences experience and produces and distributes world-class herbal remedies and dietary supplements. Route2Health is based in Pakistan and has United States Pharmacopeia (USP) GMP compliant manufacturing facilities and global partnerships.

As part of the agreement, to retain its exclusivity rights in Pakistan and The Philippines, Route2 Pharm must make minimum order quantities worth approximately $2.5 million a year.

Creso Pharma’s Non-Executive Chairman, Adam Blumenthal, commented: “This Agreement has the potential to take Creso into markets with a combined population of over 750 million people. Our mission is to deliver access to affordable, high quality, broad spectrum, GMP products for the betterment of people’s lives everywhere. We’re delighted to conclude this important partnership, through which we hope to provide the opportunity for millions of people to have access to our innovative products.”

This latest gain means the Creso Pharma share price is now up 31% since the start of the year.

More reading

• Why the Creso Pharma (ASX:CPH) share price is tumbling 5% lower
• Why Cann, Creso, LiveTiles, & New Corp shares are tumbling lower today
• What’s happening with the Creso Pharma (ASX:CPH) share price today?
• Why Blackmores, Creso Pharma, Pilbara Minerals, & Zip shares are pushing higher
• Here’s why the Creso Pharma (ASX:CPH) share price is rocketing 18% higher

Motley Fool contributor James Mickleboro 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 Altium Limited (ASX: ALU) share price is inching lower today after the release of its half-year results for 2021.

At the time of writing, shares in the electronic design software company are down 0.18% to $30.60.

How did Altium perform in H1 FY21?

The Altium share price is losing ground this morning after announcing losses across its key metrics.

In today’s release, Altium delivered a subdued performance for the first half of FY21 as COVID-19 heavily affected trading conditions.

For the period ending 31 December, the company reported group revenue of US$80 million (not including its divested Tasking business). This reflected a fall of 4% when compared to the prior corresponding period (pcp).

Altium revealed that after 8 consecutive years of double-digit growth, its United States and European operations were impacted by COVID-19. In addition, the global economic slowdown has caused a challenging environment for licence compliance activities, as witnessed post-COVID in China.

Earnings before interest, tax, depreciation and amortisation (EBITDA) sank to US$27 million, a decline of 15% over the H1 FY20 period. The company advised that a drop in revenue coupled with continued investment in its cloud business led its EBITDA to retreat.

Net profit after tax (NPAT) also plummeted to US$16.6 million, slipping 12% from the prior comparable period.

Group operating cash flow reduced to US$18.7 million, shedding 10% as a result of an increase in corporate tax payments of US$6.2 million.

Altium stated it had a healthy balance of US$88.3 million in cash, up 9% on the pcp. The company also noted that it continues to remain debt-free.

The board declared an unfranked interim dividend of 19 cents per share to be paid to shareholders on 23 March. This is a 5% decrease on H1 FY20 interim dividend, which was 20 cents per share.

Management commentary

Commenting on the company’s H1 FY21 performance, Altium CEO Aram Mirkazemi said:

Altium experienced a challenging first-half with extreme COVID conditions in the US and Europe and our pivot to the cloud involving a number of significant organisational changes that we have referred to as our Netflix Moment.

These changes included the separation of our CAD software from our Cloud business and the bifurcation of our sales into high volume (digital sales channel) and high touch (professional sales channel). We also opportunistically divested our TASKING business to concentrate our focus on accelerating the adoption of our cloud platform Altium 365 for dominance and industry transformation.

Altium 365 is key to our future success through indirect monetisation from our CAD software tools and, in time, direct monetisation from the broader ecosystem. I am most heartened by the strong adoption of Altium 365 and, with our Netflix organisational changes behind us, I am confident of a much stronger second half. Early signs are positive for this.

Outlook

Looking ahead, Altium believes that fiscal 2021 will be viewed as a pre-vaccine year. It said that while the macro environment remains challenging, a second more robust half result is expected.

The company reaffirmed its long-standing target to reach US$500 million in revenue and 100,000 subscribers by 2025. At the end of 2020, its subscriber base stood at 52,157, a 12% lift over the first-half=FY20.

Furthermore, Altium reinforced its updated guidance range for the full-year of US$190 million to US$195 million in revenue.

Altium share price snapshot

Over the last 12 months, the company’s shares are down more than 30%, reflecting weak investor sentiment. Its shares hit a multi-year low of $23.11 in March before gradually moving higher. 

Based on the current Altium share price, the company commands a market capitalisation of just over $4 billion.

More reading

• 5 things to watch on the ASX 200 on Monday
• Here’s why the Altium (ASX:ALU) share price could be a buy
• 2 of the best ASX growth shares to buy now
• 5 fantastic ASX shares to buy right now
• 2 outstanding ASX tech shares to buy and hold until 2030

Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Altium. The Motley Fool Australia owns shares of Altium. 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 Incitec Pivot Ltd (ASX: IPL) share price is sliding lower in early trade following the company’s release of a business and performance update.

Why is the Incitec share price on the slide?

The Incitec share price is heading lower today despite the company advising it expects to deliver cost savings of at least $30 million in FY2021 as previously announced. The manufacturer is also reportedly anticipating higher earnings in FY2021.

In its Fertilisers Asia Pacific segment, Incitec expects favourable weather conditions and firming fertiliser prices.

A combination of those two things looks set to provide a welcome earnings boost. Higher expected pricing also looks set to accentuate Incitec’s usual second-half earnings skew.

However, it wasn’t all good news for the company, which likely explains the Incitec share price’s lacklustre performance this morning. In the Dyno Nobel Americas Explosives segment, Incitec reported unplanned downtime due to equipment failure.

The total earnings impact of the outages is expected to be US$11 million to be included in the first-half results. Excluding these impacts, Incitec is forecasting segment earnings in line with guidance.

In its Dyno Nobel Asia Pacific Explosives segment, performance is tracking as expected. Incitec reported lower metallurgical coal exports have not materially impacted earnings to date.

More about Incitec Pivot

Incitec is a leading Australian manufacturer of fertiliser, explosives chemicals and mining services. Based on the current Incitec share price, the company has a market capitalisation of around $5.1 billion with a 1.8% dividend yield.

In this morning’s updates, Incitec advised it has now completed its Waggaman plant turnaround discovery phase. The company noted an incremental US$15 million earnings impact from the turnaround extension and plant outage, making a total US$40 million impact.

Planning and preparation for a major turnaround of its Moranbah plant in May 2021 remain on track. Incitec reported successful completion of a 6-week turnaround in November 2020 at its St Helens plant.

Incitec also completed planned maintenance at its Mt Isa/Phosphate Hill plant in October 2020.

Foolish takeaway

The Incitec share price is heading lower this morning after dual updates from the Aussie manufacturer. Incitec is set to report its interim results on Monday 17 May 2021.

More reading

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Motley Fool contributor Ken Hall 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 2020 market crash caused a wide range of shares to experience major price declines. For example, the S&P 500 Index (INDEXSP: .INX) declined by a third in a matter of weeks as investors began to price in a weaker economic outlook.

Even though there has been a stock market rally since then, the crash acts as a reminder that the stock market can be hugely unpredictable and very volatile.

Therefore, buying financially-sound businesses and diversifying in 2021 could be a sound move that lowers risks during what remains a very uncertain economic situation.

The ongoing potential for a market crash

Even though the 2020 market crash occurred in a shorter amount of time than previous bear markets, it was not an unprecedented event in terms of share prices falling heavily in a matter of weeks. For example, there have been previous rapid declines in the stock market, notably in the dot com bubble and the global financial crisis.

Predicting such events is almost impossible. Therefore, they could occur at any time without any prior warning. With the economic outlook being very uncertain at the present time, there may even be a higher chance of a market decline in the coming months. While this may or may not take place, being ready for it at all times could be a means of reducing risk and capitalising on a possible recovery in its wake.

Buying financially-sound businesses

Even though most shares fell heavily in the 2020 market crash, buying financially-sound businesses could be a shrewd move. The stock market declined partly because of a weaker economic outlook caused by coronavirus. As such, it could have a larger negative impact on companies with weak balance sheets that contain large amounts of debt. They may be less able to service their debt should sales fall than a company that has lower leverage.

Of course, buying even the most financially-stable business will not make any investor immune from a stock market fall. However, it can mean their holdings have a higher chance of still being in existence to benefit from a potential market recovery as the economic outlook improves and investor sentiment strengthens.

Building a portfolio for 2021

The 2020 market crash also showed that some sectors can be worse affected than others by a downturn. For example, at the present time industries such as financial services and resources are underperforming many of their index peers due to relatively weak operating conditions.

As such, owning a variety of companies that operate in a broad range of industries could be a shrewd move. This strategy will not eliminate risk entirely. However, it could reduce overall risks during the course of 2021 and in the coming years, with the economic and stock market outlook continuing to be very unpredictable because of the ongoing pandemic.

More reading

• Why the Altium (ASX:ALU) share price is inching lower
• Incitec (ASX:IPL) share price falls on performance update
• Why ASX travel shares were smashed on Friday
• Why the Cann (ASX:CAN) share price is pushing higher
• Why the Bendigo and Adelaide Bank (ASX:BEN) share price is storming 8% higher today

Motley Fool contributor Peter Stephens 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.

The post Why I won’t forget the 2020 market crash when buying stocks in 2021 appeared first on The Motley Fool Australia.

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It was a tough end to the week for ASX travel shares as coronavirus restrictions reappeared in Victoria.

Why are ASX travel shares under pressure?

While the S&P/ASX 200 Index (ASX: XJO) fell 0.6% on Friday to close at 6,806.70 points, many of the biggest travel shares saw large losses.

The Webjet Limited (ASX: WEB) share price fell 3.9% lower on Friday and 9.6% for the week. It was a similar story for other ASX travel shares including Corporate Travel Management Ltd (ASX: CTD) and Flight Centre Travel Group Ltd (ASX: FLT) down 7.2% and 5.9%, respectively.

Even Qantas Airways Ltd (ASX: QAN) shares slumped 4.8% on Friday. Deteriorating conditions and the reintroduction of Victorian lockdown restrictions made investors nervous to close the week.

The large share price losses came as Victoria introduced a snap 5-day lockdown. The state has made the call to try and get COVID-19 cases under control. Victorians have re-entered stage 4 lockdown until 11.59pm on Wednesday as fears of the UK strain of the coronavirus grow.

Tightening border restrictions and increasing uncertainty saw investors sell down on Friday. The stop-start nature of border re-openings has made it difficult for businesses of all sizes to plan. That uncertainty has caused angst amongst key members of the business community.

The Victorian business community called for greater continuity amid fears businesses will take a significant hit from the latest lockdown.

Spectators will be unable to attend the Australian Open as planned for the next 5 days due to tightening restrictions. That means fewer tourists than had originally been hoped for one of Melbourne’s showcase events.

That saw ASX travel shares get hit hard on Friday as the benchmark ASX 200 Index slid lower to close the week on a weaker note.

Foolish takeaway

ASX travel shares were smashed on Friday to continue a downward trend throughout the week.

With a 5-day snap lockdown announced for Victoria, all eyes will be on Daniel Andrews and the Victorian Government for case numbers throughout the next week.

More reading

• ASX 200 Weekly Wrap: ASX cools on earnings reality check
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 next week
• Is the Webjet (ASX:WEB) share price a buy right now?
• These were the best performing ASX 200 shares last week

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Webjet Ltd. 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.

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The Cann Group Ltd (ASX: CAN) share price is pushing higher today following the release of a couple of announcements.

At the time of writing, the cannabis company’s shares are up 2.5% to 79 cents.

Why is the Cann share price pushing higher?

Investors have been buying Cann shares today after it announced a new acquisition.

According to the release, the company has agreed to acquire the Satipharm business from Harvest One Cannabis in an all-scrip deal. The two parties have agreed a total maximum consideration of C$4 million worth of Cann shares, including conditional deferred consideration of up to C$1.5 million.

Satipharm is a Europe-based business exclusively licensed to develop and market the proprietary Gelpell delivery system for cannabinoids.

Gelpell capsules are manufactured by Swiss-based GMP manufacturer Gelpell AG which, with Satipharm, jointly owns the patented delivery technology. The release explains that Satipharm has generated data in support of its claims that this patented delivery technology exhibits improved stability and bioavailability of cannabinoids compared to other formulations.

It currently has existing distribution agreements in place in the UK, Ireland, and Eastern Europe.

Cann’s CEO, Peter Crock, commented: “The technology will allow us to develop more targeted and effective dosage forms of both low dose CBD and differentiated THC prescription formulations of medicinal cannabis. We believe the Satipharm product offers superior efficacy, delivery and stability qualities compared to other products and we expect these unique features, coupled with its presentation in a more familiar capsule form expected of pharmaceuticals, to generate greater confidence from prescribing doctors.”

“The Satipharm acquisition provides an opportunity to accelerate both short-term and longer-term revenues. Over time, we believe we can expand the number of markets into which these products are sold and expand the range of formulations to be targeted at both the OTC and prescription segments,” said Mr Crock.

Speaking of revenues, Cann also provided a revenue update this morning.

How is Cann performing?

Unfortunately, this announcement wasn’t as positive as the acquisition announcement. It turns out that Cann isn’t performing as well as it was expecting.

According to the release, due to COVID-19 related regulatory delays, management has downgraded its revenue guidance materially.

Cann is now forecasting revenues of between $8 million and $10 million in FY 2021. This is down 33% to 46.5% from its previous guidance of $15 million. It also remains subject to relevant regulatory clearances being secured.

Management notes that substantial delays have been incurred in relation to obtaining required regulatory approvals both in Australia and in Germany.

But judging by the Cann share price performance today, the acquisition news appears to have been enough to offset its revenue guidance downgrade.

More reading

• Why Cann, Creso, LiveTiles, & New Corp shares are tumbling lower today
• Why the Cann (ASX:CAN) share price is crashing 10% lower today
• Why the Cann (ASX:CAN) share price is sinking lower today
• Up in smoke! Why ASX cannabis shares are having a bleary day

Motley Fool contributor James Mickleboro 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 Bendigo and Adelaide Bank Ltd (ASX: BEN) share price is on the move on Monday morning.

At the time of writing, the regional bank’s shares are up a sizeable 8% to $10.25.

Why is the Bendigo and Adelaide Bank share price storming higher?

Investors have been buying Bendigo and Adelaide Bank shares this morning following the release of its half year results.

According to the release, for the six months ended 31 December, the bank reported total income growth of 3.3% to $849 million and statutory net profit growth of 67.3% to $243.9 million. The latter was predominantly attributable to software impairments and software accelerated amortisation adjustments recorded in December 2019 and not repeated in the current period.

The bank’s cash earnings after tax increased 1.9% over the prior corresponding period to $219.7 million. This was driven by growth in its lending portfolios and an increase in hedging revenue, which offset a 7 basis points decline in its net interest margin to 2.30%.

The Bendigo and Adelaide Bank board declared a fully franked dividend of 28 cents per share. This comprises 4.5 cents per share relating to the deferred FY 2020 final dividend and 23.5 cents per share relating to the FY 2021 interim dividend.

At the end of the period, the company’s CET 1 ratio had improved 36 basis points to 9.36%.

What about bad debts?

Possibly supporting the Bendigo and Adelaide Bank share price today was news that its bad and doubtful debts fell 15.9% to $19.5 million.

The bank’s Managing Director and CEO, Marnie Baker, commented: “Our bad and doubtful debts of $19.5 million, comprised six basis points of gross loans. We reviewed our COVID-19 collective provision overlay at 31 December 2020, resulting in a modest reduction to manage ongoing uncertainty around the future impact of the pandemic. The increase in specific provisions primarily relates to existing impaired loans and reflects limited recovery action and asset sales due to COVID-19.”

Outlook

Also supporting the Bendigo and Adelaide Bank share price today will have been comments regarding the future.

Marnie Baker said: “With business confidence and consumer sentiment up, an ongoing low-rate environment, a growing housing market, an improving jobs market, continued growth in regional Australia, and our customers showing remarkable resilience and adaptability, we are buoyed by the outlook.”

Though, Baker remains cautious, advising that the bank always takes “a long-term view, and we remain mindful of the global and local impacts of the pandemic, international trade sentiment, decisions on government support measures and the ongoing reality of natural disasters and climate change.”

Nevertheless, the CEO is aiming to win market share from rivals.

“Looking ahead, supported by our growth and transformation strategy, we continue to target above system residential lending and further growth in small business and agribusiness sectors, whilst reducing our cost base, and maintaining a strong and resilient balance sheet,” she added.

“Our advantages and market opportunities lie in the strength of our purpose, values, strategy, and customer commitment – which remains central to who we are – as we continue our journey to be Australia’s bank of choice,” concluded Ms Baker.

More reading

• Leading brokers name 3 ASX shares to sell today
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor James Mickleboro 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 Nearmap Ltd (ASX: NEA) share price has returned from its trading halt and is surging higher this morning. This follows the release of its response to a short seller attack and its half year results.

At the time of writing, the aerial imagery technology and location data company’s shares are up 12% to $2.43.

How did Nearmap perform in the first half?

According to the release, contrary to what short sellers were saying, Nearmap revealed that a record performance in North America underpinned strong annual contract value (ACV) during the first half.

At the end of December, Nearmap’s total ACV stood at $112.2 million on a reported basis and $116.7 million on a constant currency basis. This represents a 16.1% and 21% increase, respectively, over the prior corresponding period. However, its reported ACV is up a more modest 5.4% since the end of FY 2020.

Thanks to operating leverage, Nearmap’s margins improved and underpinned strong operating earnings growth. The company reported a 322% increase in earnings before interest, tax, depreciation and amortisation (EBITDA) to $13.5 million.

On the bottom line, the company posted a statutory loss after tax of $9.4 million. This was an improvement from an $18.6 million loss a year earlier.

Despite this loss, Nearmap ended the period with a cash balance of $129.3 million. This was thanks largely to its $72.1 million capital raising in September.

The company’s Chief Financial Officer, Mr Andy Watt, commented: “1H21 has seen a strong performance across many of the metrics we benchmark our business against, reflecting the strength of our underlying business model.”

“Following the decision to raise capital in September, we have maintained a disciplined approach to managing costs within our business and we have continued to drive returns from investments previously made. This leaves Nearmap in a very strong position to selectively deploy capital into key business initiatives and accelerate our growth opportunities, driving increased returns across our ACV portfolio,” he added.

North America segment

The release explains that its North American ACV has grown 21.9% since the end of June to US$35.1 million. This means the segment has delivered more incremental ACV during the half than it did during the entirety of FY 2020.

Management advised that ACV growth from Roofing, Insurance, and Government was up 42% on the prior corresponding period and accompanied by a strong contribution from adjacent verticals.

Another positive was that its retention rate improved to 93.5%. This compares to 79.4% a year earlier following unforeseen churn events.

At the end of the period, the company had subscriptions of 2,029 in North America, up 24% from the same period last year. Its average revenue per subscription (ARPS) increased 13% to US$17,313.

ANZ segment

Nearmap’s ANZ ACV reached $66.6 million at the end of December. This was up 4.9% since the end of June and 9% on the prior corresponding period.

Management advised that it achieved strong ACV growth in its SME portfolio, which was partially offset by lower Enterprise sales. It notes that the overall opportunity continues to grow and a refined go-to-market strategy will be deployed to drive renewed growth.

Nearmap’s ANZ segment recorded a retention rate of 94% and had 8,756 subscriptions at the end of the half. The latter was up 4% since this time last year. Finally, its ARPS grew 5% to $7,604.

Outlook

The company’s CEO, Dr Rob Newman, appears positive on the future.

He said “Nearmap is well positioned to continue its strong growth in our core markets and progress further in developing the next generation of the world’s leading aerial camera system – HyperCamera3. Our focus for the remainder of FY21 and moving into FY22 will continue to be providing best-in-class service to our customers, through successful execution of our go-to-market strategy and continuing to develop our superior technology.”

“As we continue to innovate, we will roll-out tailored industry vertical solutions, to ensure we remain a trusted and increasingly valuable partner to our customers. I am confident in the outlook for our business and we remain focussed on becoming the global leader in subscription-based location intelligence,” he concluded.

Stay tuned for details on the company’s response to the aforementioned short seller attack. Judging by the Nearmap share price, investors appear happy with what management had to say on the matter.

More reading

• 5 things to watch on the ASX 200 on Monday
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• Why brokers rate these 4 ASX shares a buy this month
• ASX 200 down 0.3%: Crown CEO hasn’t resigned, Mirvac update, Nearmap remains halted
• Nearmap (ASX:NEA) share price sinks 7% on scathing short seller attack

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 Nearmap Ltd. The Motley Fool Australia has recommended Nearmap 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 Seven West Media Ltd (ASX: SWM) share price is on watch today after the company’s interim results release.

Why is the Seven West share price on watch?

Shares in the Aussie media group will be on watch after it reported a significant interim earnings increase.

Seven West booked $644.2 million of revenue for the half-year ended 31 December 2020 (1H 2021), down 9.8% from the prior corresponding period (pcp). Net profit after tax of $116.4 million bounced back from last year’s $48.6 million net loss.

Seven West reported underlying group earnings before interest, tax, depreciation and amortisation (EBITDA) up 24.4% to $165.7 million. Group EBIT climbed 29.0% to $152 million, with underlying earnings per share (EPS) of 5.6 cents.

The Seven West share price is one to watch in early trade as investors process the latest earnings result. The media group slashed operating costs by 18% to $480 million, excluding depreciation and amortisation.

The board decided not to pay a dividend as Seven West continues to focus on debt reduction. The group reported total borrowings of $740.6 million with net debt of $328.9 million (excluding lease liabilities). Seven West’s closing net assets stood at -$114.9 million compared to -$122.9 million in December 2019.

Seven West Media Managing Director and CEO James Warburton said the group achieved “several major milestones”.

The company continues to embark on its transformation journey with a pivot towards digital content. Thanks to strong user numbers, seven’s Broadcast Video on Demand (BVOD) revenue jumped 73% year on year.

What lies ahead in FY2021 for Seven West?

The Seven West share price will also be worth watching after today’s outlook and strategic priorities update.

Seven sees television advertising markets as “buoyant” after a solid Q2 FY2021. Early bookings indicate Q3 revenue for its Seven business could be 7% to 10% ahead of Q3 FY2020.

Management is expecting annual operating expenses at the bottom of the $1.03 billion to $1.05 billion analyst range. One-off cost events associated in FY2022 relating to both Olympics are expected to be offset by higher revenue.

Mr Warburton said Seven is well-positioned for the recovery in the advertising market after COVID-19. A reshuffling of content and greater focus on cost control has helped boost the bottom line in 1H FY2021. Seven West is forecasting an incremental $30 million cash saving as it hones in on “onerous” sports contracts.

The Seven West price has surged 30.6% higher in 2021 and reached a new 52-week high of 50 cents during intraday trading on Friday.

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Motley Fool contributor Ken Hall 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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