Tag: Motley Fool

More reading

• Byron Energy (ASX:BYE) rigs evacuated as hurricane Zeta approaches
• $14 trillion investor alliance warns Aussie mining companies
• Here’s how BrainChip (ASX:BRN) performed in the third quarter
• Why the Fluence (ASX:FLC) share price is up 10% today
• The shares to buy for 3 different US election outcomes

Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post BluGlass (ASX:BLG) share price jumps 15% on US Defence contract appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/383BLMf

The Byron Energy Ltd (ASX: BYE) share price plummeted 8.82% to 15.5 cents today before recovering to 16 cents at the time of writing. This came after the company announced that it had evacuated 2 assets in the gulf of Mexico.

What was in the announcement?

Byron Energy said it had evacuated production operators from its assets at South Marsh Island 58 and South Marsh Island 71 due to adverse weather conditions caused by hurricane Zeta. 

At the company’s South Marsh Island 58 asset, tying of the G2 well into production equipment is almost complete. Production from the well can begin after the tie-in is completed, the company said. However, production has been delayed due to hurricane Zeta and is now expected to resume next week after 2 November 2020. Byron has a 100% working interest in the well and an 83.33% revenue interest.

Production from the Byron Energy operated South Marshal Island 71 F platform was shut down on 25 October 2020 due to pipeline shut ins associated with hurricane Zeta. Byron Energy holds a 50% working interest in the platform and 40.625% net revenue interest in the block. Otto Energy Ltd (ASX: OEL) holds a working interest and net revenue interest in the asset equivalent to Byron Energy.

According to the Byron Energy, production at South Marshall Island 58 and South Marshal Island 71 will continue as soon as conditions are safe.

About the Byron Energy share price

Byron Energy is an oil and gas explorer with assets in the gulf of Mexico. The company has been listed on the ASX since 2005.

In the year to 30 June 2020, Byron Energy had revenue from the sale of oil and gas of US$24.37 million, down from US$38.57 million in the year to 30 June 2019. Byron Energy posted a loss of US$70,396 in FY2020, this followed a profit of US$5.74 million in the 2019 financial year.

At 30 June 2020, Byron Energy had proven reserves (1P) of 8.1 million barrels of oil and 58.5 billion cubic feet of gas. The company had proven and probable reserves (2P) of 17.5 million barrels of oil and 105.3 billion cubic feet of gas at 30 June 2020.

The Byron Energy share price is up 60% since its 52-week low of 10 cents, however, it is down 46.67% since the beginning of the year. The Byron Energy share price is down 46.67% since this time last year.

More reading

• $14 trillion investor alliance warns Aussie mining companies
• Here’s how BrainChip (ASX:BRN) performed in the third quarter
• Why the Fluence (ASX:FLC) share price is up 10% today
• The shares to buy for 3 different US election outcomes
• Here’s what this broker thought of the Afterpay (ASX:APT) Q1 update

Motley Fool contributor Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Byron Energy (ASX:BYE) rigs evacuated as hurricane Zeta approaches appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3jEGQg2

A group that manages $14 trillion worth of investments has put Rio Tinto Limited (ASX: RIO) and other mining companies on notice.

In a letter sent on Thursday, the group warned that it required confidence in how the companies liaised with Indigenous land owners to manage risk for its long-term investments.

The correspondence came after Rio Tinto in May blew up Juukan Gorge in Western Australia, which displayed historical and cultural evidence of human habitation going back 46,000 years.

“The recent tragic and irreversible destruction of First Nations sites of cultural and archaeological significance in the Juukan Gorge, in Australia, highlights the consequences for communities, companies and investors when relations with communities are not adequately managed,” the letter reads. 

“This in turn calls into question the social license of a company to operate.”

Who sent the letter?

The investors’ group included international giants like the Church of England Pensions Board, AXA IM and Council of Ethics for the Swedish National Pension Funds. Local signatories included large superannuation funds like HESTA, Australian Super and Cbus.

ASX-listed recipients included Rio Tinto, BHP Group Ltd (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG) and Newcrest Mining Limited (ASX: NCM).

Church of England Pensions Board ethics & engagement director Adam Matthews said each time an adverse event happens, it casts a shadow over the entire industry.

“As with the issue of tailings dam safety a single event has exposed a systemic issue across the mining sector.”

HESTA chief Debby Blakey said the Juukan Gorge tragedy was “a wake-up call” for investors small and large.

“It’s critical companies and investors who are making long-term decisions manage risks associated with indigenous heritage protection appropriately,” she said. 

“Not only so we can mitigate financial risk for our members’ investments, but also so we can ensure there are fair and sustainable outcomes for indigenous communities and companies.”

Failure to protect culturally significant sites is a “material investment risk”, said Australian Council of Superannuation Investors chief Louise Davidson.

“The events of Juukan Gorge have identified a significant failing in the way Rio Tinto managed its relationship with traditional owners,” she said.

“We want to understand how companies across the industry are managing these risks and working to ensure that a disaster like the Juukan Gorge never happens again.”

Rio Tinto initially stripped $7 million of bonuses from 3 executives. But after investor pressure all 3 departed the company, albeit with golden handshakes worth millions of dollars.

More reading

• Newcrest (ASX:NCM) share price tumbles lower following Q1 update
• How did ASX iron ore shares perform in the last quarter?
• Fortescue (ASX:FMG) share price lower despite record Q1 shipments
• 5 things to watch on the ASX 200 on Thursday
• How did ASX gold shares perform in the last quarter? 

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post $14 trillion investor alliance warns Aussie mining companies appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/31T5WS7

The BrainChip Holdings Ltd (ASX: BRN) share price has managed to avoid the selloff and is trading flat at 37 cents in late trade following the release of its third quarter update.

What happened in the third quarter?

During the three months ended 30 September, BrainChip reported cash receipts from customers of just US$10,000. This brings its financial year to date cash receipts to US$22,000.

The company posted a cash outflow from operating activities of US$2.2 million. However, thanks to US$8.45 million from the exercise of options, it ended the period with a cash balance of US$12.2 million.

And as of 26 October, its cash balance had increased to US$20.3 million thanks to proceeds from its put option agreement with LDA Capital, as well as the exercise of employee and investor stock options.

What developments have happened during the quarter?

BrainChip had a busy quarter and entered into several agreements for its Early Access Program (EAP).

This includes with The Ford Motor Company, Valeo, Vorago Technologies, and the National Aeronautics and Space Administration (NASA).

Management notes that the EAP provides engineering samples, evaluation boards, and dedicated support to manufacturers that will evaluate its Akida neuromorphic processor. Fees to participate in the EAP are intended to cover the company’s expenses related to participants individual requirements.

What is the Akida neuromorphic processor?

BrainChip is working on a neuromorphic processor that brings artificial intelligence to the edge.

Management believes its chip is high performance, small, ultra-low power, and enables a wide array of edge capabilities. These include on-chip training, learning and inference.

It explained that the event-based neural network processor is inspired by the spiking nature of the human brain and is implemented in an industry standard digital process.

By mimicking brain processing, BrainChip believes it has pioneered a processing architecture, called Akida, which is both scalable and flexible to address the requirements in edge devices.

Akida has been designed to provide a complete ultra-low power and fast AI Edge Network for vision, audio, olfactory and smart transducer applications. It notes that the reduction in system latency provides faster response and a more power efficient system that it believes can reduce the large carbon footprint of data centres.

More reading

• Douugh and Ioupay were among the most traded shares on the ASX last week
• Brainchip (ASX:BRN) share price jumps on quarterly update
• 3 ASX shares I think could be the next Afterpay (ASX:APT)
• 3 unique ASX shares I’d buy and hold forever
• A2 Milk and Mesoblast were among the most traded shares on the ASX last week

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here’s how BrainChip (ASX:BRN) performed in the third quarter appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2HHj3i7

The Fluence Corporation Ltd (ASX: FLC) share price is up 10% in late afternoon trading. That puts the company in the enviable position of being among the biggest gains posted on the All Ordinaries Index (ASX: XAO) today, with the All Ords down 1.8%.

The share price surge comes following today’s update on the company’s Ivory Coast water treatment project. And it will come as welcome news to shareholders who’ve watched the share price slide for much of the year.

With today’s gains, the Fluence share price is down 50% year-to-date. That compares to a 10% loss for the All Ords.

What does Fluence do?

Fluence is involved in the decentralised water, wastewater and reuse treatment markets. Its smart products solutions include Aspira, NIROBO and SUBRE. The company’s range of services range from early stage evaluation to design and delivery through to ongoing support and optimisation of water related assets. Fluence operates in 70 countries, with established operations in North America, South America, the Middle East, Europe and China. It aims to help businesses and communities make the most of their water resources.

Why did the Fluence share price leap higher?

Fluence announced that the Israel Discount Bank had confirmed the final conditions precedent for the 165 million euro (AU$275 million) Ivory Coast water treatment plant. The Ivory Coast finance facility will now begin funding contractual payments to Fluence for the plant.

Fluence plans to start construction immediately. The surface water treatment plant will be capable of treating 150,000 cubic metres of water daily. It will treat contaminated water from Lagune Aghein, the biggest freshwater reserve in Ivory Coast, helping to supply fresh water to Abidjan, the nation’s most populous city.

Commenting on the news, Fluence CEO Henry Charrabe said:

Despite challenging logistics and COVID-19 related delays, we are very pleased to have been able to meet this key milestone to progress the Ivory Coast Project and to officially commence construction. This is an immensely important project for the people of Ivory Coast, and we look forward to now fully mobilising.

More reading

• Why the CV Check (ASX:CV1) share price is edging lower today
• Why the Champion Iron (ASX:CIA) share price is up 6% today
• Why the Evans Dixon (ASX:ED1) share price is up 7% as the All Ords slides
• Why the Probiotec (ASX:PBP) share price is trading higher
• Why the Danakali (ASX:DNK) share price is down 7% 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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why the Fluence (ASX:FLC) share price is up 10% today appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/383zHDZ

With the United States election just a few days away, equities experts are dusting off their crystal balls to work out how Australian investors might take advantage.

A couple of weeks ago, T. Rowe Price Group Inc (NASDAQ: TROW) Australian equities head, Randal Jenneke, presented 3 potential outcomes — and his thoughts on the best shares to hold for each scenario.

Now Betashares Director, Adam O’Connor, has done a similar exercise, coming up with his own 3 possible scenarios and what Aussie investors might do in each.

Scenario 1: blue wave

This is the outcome the polls are suggesting at the moment — Democrat wins in both the White House and Congress.

This would give the centre-left party a clear mandate to reform.

“It’s expected this would include large-scale fiscal spending – with a major focus on clean energy and infrastructure, health care reform, and the possibility of a return to higher corporate taxes and increased corporate regulation,” said O’Connor.

“Though it has been suggested that, with a focus on stimulating the economy and getting Americans back to work post-COVID, any corporate tax reform could be delayed.”

This naturally would make shares related to the clean energy industry or those that are environmentally focused very attractive.

“Biden’s policy agenda… could also accelerate the structural shift towards sustainability and have flow-on effects for Wall Street, with an increased focus on ESG factors,” O’Connor said.

“There could also be tighter regulation on oil and gas exploration and production, particularly for US shale.”

Conversely, the technology industry could suffer from some headwinds.

“There are well-documented concerns from the Democrats around the monopoly power of the tech giants such as Apple, Facebook, Amazon, and Alphabet,” said O’Connor.

“A Biden administration could potentially subject the large digital platforms to greater regulation and take a harder line on antitrust enforcement.”

Scenario 2: shared power

If Biden takes the presidency and the Republicans hold onto the Senate, the Democrats reform agenda would be severely hampered.

“Any change in climate policy would also likely need to be via regulation rather than legislation, while major healthcare reform and tax changes would be difficult to achieve,” O’Connor said.

“On the other hand, policies with bipartisan support such as infrastructure spending would likely be easily implemented.”

In this case, US healthcare stocks could do well.

“The healthcare sector in the U.S. has been trading close to its largest discount to the broader S&P 500 in nearly 30 years as markets have been pricing in an increasing likelihood of a Democratic sweep,” said O’Connor.

“However, under a divided congress any proposed drug price controls are inevitably going to be more difficult to negotiate and are more likely to remain on hold while the government relies on drug manufacturers for a COVID vaccine.”

According to Betashares, in the past 70 years share markets have averaged better returns when the White House and Congress were held by different parties.

“Overall, a divided congress would lead to less policy uncertainty, and combined with a more stable foreign policy and an easing of trade tensions, would potentially be supportive of broad equity valuations.”

Scenario 3: Trump is re-elected

If the status quo remains and the Republicans hold onto both the White House and the Senate, the tech-led bull market has a chance of continuing.

“Trump has always seen the strength of the stock market as a barometer for the success of his administration,” O’Connor said.

“So he appears unlikely to do much to undermine the strength of America’s dominant technology sector.”

The corporate tax cuts he enacted during this first term would survive and the market will not need to price in any climate change-related reforms.

“More than likely Trump will continue to provide support for America’s energy industry.”

Long-term impacts no matter who wins

O’Connor also noted that there are market forces that will prevail regardless of who wins the White House and the Senate.

Recovery out of the COVID-19 recession is a major factor, as is the arrival of a coronavirus vaccine and Federal Reserve policy shifts.

“Structural trends like digitisation and automation could also continue to dictate market leadership, irrespective of who is in the White House,” he said.

More reading

• Here’s what this broker thought of the Afterpay (ASX:APT) Q1 update
• The Clinuvel (ASX:CUV) share price edges down on Q1 update
• Is inflation back in black? Here’s what it means for ASX shares
• Newcrest (ASX:NCM) share price tumbles lower following Q1 update
• The Metalstech (ASX:MTC) share price is flying today. Here’s why.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Tony Yoo owns shares of Alphabet (A shares) and Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, and Facebook and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, and Facebook. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post The shares to buy for 3 different US election outcomes appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3e3MA1I

The Afterpay Ltd (ASX: APT) share price has been caught up in the market selloff and is tumbling lower today.

In afternoon trade the payments company’s shares are down 3.5% to $99.33.

Is this a buying opportunity?

While I think this pullback could be a buying opportunity when the dust settles on this latest market volatility, one leading broker believes investors should wait for an even better entry point.

According to a note out of Goldman Sachs, this morning the broker held firm with its neutral rating and lifted its price target to $94.40 following its first quarter update.

Goldman was pleased that Afterpay’s operating momentum appears robust. However, it notes that its customer additions in the United States fell short of its expectations. The broker had forecast US customer numbers of 6.7 million, compared to the 6.5 million that it reported.

It commented: “APT operating momentum appears robust although customer additions in the US of 6.5mn were below GSe 6.7mn. We note, however, the December quarter in the US is seasonally a very strong one and customer addition run-rates were indicated to be accelerating into October.”

Two things the broker was particularly pleased with were the growing frequency of use in the ANZ market and its net transaction profit margin. These were both ahead of its expectations.

What else did Goldman Sachs say?

Goldman Sachs expects Afterpay to continue to execute strongly, however it does have concerns over the impact of increasing competition.

The broker commented: “While APT continues to execute strongly and we anticipate it will have a strong December 2020 quarter, at this stage we remain Neutral rated reflecting the fact we expect competition to intensify particularly in the US market.”

Goldman notes that plenty of institutional funds have been flooding into the industry. 

“A number of APT’s US competitors have recently completed equity raisings. Klarna announced a US$650mn equity funding round in September 2020 and Affirm raised US$500mn in September 2020 in a series G funding round ahead of its launch of a fortnightly instalment product with Shopify. We also note that Paypal has launched its ‘pay in 4’ product for the upcoming holiday season,” it explained.

In light of this, the broker will be holding firm with its neutral rating for the time being.

More reading

• Today was mixed for the ASX 200, ending 0.1% higher
• Why Afterpay, Blackmores, Coles, & Super Retail shares are charging higher
• ASX 200 flat: Afterpay impresses, Coles beats expectations, & HUB24 in a trading halt
• Why Resmed, Coles, Afterpay and one other have made early share price gains
• How ASX shares like Afterpay (ASX:APT) push for explosive growth

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here’s what this broker thought of the Afterpay (ASX:APT) Q1 update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/37R3KhO

The Clinuvel Pharmaceuticals Limited (ASX: CUV) share price has edged lower today following the release of its Q1 results.

At the time of writing, shares in the global biopharma are treading lower at 1.9% to $21.44. It’s no surprise that the S&P/ASX 200 Index (ASX: XJO) is also in negative territory today, falling 1.7% to 5,952 points.

The ASX market sell-off comes as Wall Street experienced its worst day in months, extending its losing streak to four consecutive days.

So, despite the current turmoil in world markets, how did Clinuvel perform for the start of the new financial year?

Performance review

For the period ending 30 September, Clinuvel continued to progress the commercial distribution of its flagship drug, Scenesse. Despite the difficult operating environment, the company further pushed into the United States and Europe.

Cash receipts for the September quarter totalled $12 million, an increase of 22.8% on the prior corresponding period (pcp). This was underpinned by a surge in treatment demand that normally occurs over the summer period. AThis is because exposure to visible and ultraviolet light poses a greater risk to patients with erythropoietic protoporphyria (EPP).

After expenditure on operating activities, Clinuvel recorded a net cash flow of $7.8 million, reflecting controlled growth during COVID-19. First receipts from the commercial distribution of Scenesse in the US were received. In addition, European orders were placed and will be paid later in the calendar year. The majority of cash outflows was from the completion Clinuvel’s new Singaporean research, development & innovation centre.

The company closed the quarter with $72.7 million in cash and equivalents, a 9% increase on the prior period.

Commercial operations

During the pandemic, Clinuvel further expanded its commercial operations in the US and Europe. Research and development activities focused on novel treatments for patients with severe genetic, skin and vascular disorders.

As the majority of expert centres in Europe have prescribed Scenesse, a small number of clinics have either deferred or reduced orders. This was attributed to uncertainty in patient demand around the pandemic.

In the US, company planning has jumped ahead of schedule with 26 speciality centres trained to administer Scenesse. This almost completes the original target to have 30 clinics running by July 2021.

Management commentary

Commenting on the results, Clinuvel CFO Darren Keamy said:

The continued demand for Scenesse from EPP patients in Europe and the USA bolstered the group’s cash receipts in the September quarter.

The further rise in our cash reserves after the payment in the quarter of a third annual dividend as the northern hemisphere winter months approach is welcome in the context of the adverse operating environment and the ability it provides to self-finance the growth of commercial operations and the expansion of our research and development activities.

More reading

• Xplore Wealth share price surged to a 2-year high today on M&A fever
• Why market crashes are useful for buying ASX dividend shares
• The Seek Ltd (ASX:SEK) share price under attack by offshore shorter
• ASX 200 down 1.1%: ANZ cash earnings down 42%, SEEK slammed, HUB24 jumps
• 5 things to watch on the ASX 200 on Thursday

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post The Clinuvel (ASX:CUV) share price edges down on Q1 update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/34zgEz4

Inflation is not a problem we hear too much about in 2020 – apart from a lack of it. In fact, most of the discussions surrounding inflation have instead been about deflation, or negative inflation.

Inflation, if you didn’t know, refers to the (usually) gradual loss of purchasing power of a currency over time. It’s the reason your grandparents used to talk about a loaf of bread costing 25 cents, or a brand new car costing $5,000. Most economists accept that a small level of inflation is good for the economy. It encourages people to spend their money sooner rather than later. It also encourages credit (borrowing money) since a loan loses its ‘real’ value over time with inflation.

Inflation used to be an ever-present threat to economic growth that governments and central banks watched like a hawk (and raised interest rates if it got too high). Under conventional economic theory, inflation is usually pushed higher in times of strong economic growth, and falls off the perch in times of sluggish growth or recession. But over the past 10 years or so, economists have stopped talking about inflation and started to talk about the lack of it. This has only been exacerbated as a result of the coronavirus pandemic. Since the pandemic began, the entire world has been plunged into recession. Inflation in Australia actually went negative (i.e. deflation) for the first time since 1998 in 2020.

Inflation is back in black

But according to reporting in the Australian Financial Review (AFR) this week, inflation is back in black and let loose from the noose.

According to the AFR, Australia recorded the biggest quarterly rise in inflation since 2006 in the quarter ending 30 September, increasing 1.6%. That pushes the annual headline inflation rate to 0.7%, up from the -0.3% that was running in the previous quarter.

The fall that inflation took in the quarter ending 30 June was apparently the biggest quarterly fall since the Australian Bureau of Statistics began recording inflation way back in 1948.

What do higher prices mean for ASX shares?

Whilst this news looks good for the economy, there are a couple of caveats to mention. Firstly, as the AFR notes, childcare costs were a significant component of the positive quarterly inflation number at 0.9%. Childcare was temporarily made universally free by the federal government earlier in the year. However, this policy expired on 13 July. Further, the oil price spent the quarter recovering from historic lows (including a short period of negative oil prices). This would have fed into petrol and transportation price rises over the quarter as well.

Even so, all things considered, an inflation rate of 1.6% for the quarter is good news. It indicates that the Australian economy is in recovery mode (even if it is mild at this stage). And that, in turn, is good news for the ASX shares that operate within it.

More reading

• The Clinuvel (ASX:CUV) share price edges down on Q1 update
• Newcrest (ASX:NCM) share price tumbles lower following Q1 update
• The Metalstech (ASX:MTC) share price is flying today. Here’s why.
• 2 ASX 200 shares poised to rocket when the world reopens
• Jumbo (ASX:JIN) share price drops lower following Q1 update

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Is inflation back in black? Here’s what it means for ASX shares appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2TvArsW

The Newcrest Mining Limited (ASX: NCM) share price has taken a tumble on Thursday.

In afternoon trade the gold miner’s shares are down a sizeable 4.5% to $29.21.

Why is the Newcrest share price dropping lower?

The Newcrest share price has come under pressure today following a pullback in the gold price which has offset the release of a first quarter update that was in line with expectations.

For the three months ended 30 September, Newcrest achieved group gold production of 503,089 ounces and copper production of 34,763 tonnes. While this was down notably quarter on quarter because of major planned maintenance, it still puts the company on track to achieve its full year guidance.

This production was achieved with a group all-in sustaining cost (AISC) of US$980 per ounce, up 11.5% from the prior quarter.

Nevertheless, thanks to a similar increase in its average realised gold price to US$1,837 per ounce, the company delivered an AISC margin of 46% or US$847 per ounce.

What were the drivers of this result?

The Cadia operation delivered gold production of 196,504 ounces and copper production of 25,329 tonnes. This was achieved with a record low AISC of just US$113 per ounce.

Management commented: “Cadia’s AISC of $113 per ounce is its lowest on record, primarily driven by a higher realised copper price and timing of sustaining capital expenditure. These benefits were partially offset by lower gold production, an increase in operating costs associated with the planned shutdowns, the impact on operating costs from the strengthening of the Australian dollar against the US dollar and lower copper sales volumes.”

Over at its Lihir operation, Newcrest recorded gold production of 177,337 ounces at an AISC of US$1,283 per ounce. “Gold production of 177koz was 14% lower than the prior period primarily due to lower throughput, grade and recovery,” management explained.

The company’s Telfer operation reported gold production of 86,452 ounces and copper production of 2,384 tonnes. This was achieved with a notably higher AISC of US$1,797 per ounce. Management advised that this was due to the impact of lower gold production, an increase in site operating costs, and foreign exchange headwinds.

The Red Chris operation reported gold production of 12,636 ounces and copper production of 7,050 tonnes with an AISC of US$2,621 per ounce. This sky high AISC was driven by increased sustaining capital expenditure, higher operating costs, foreign exchange headwinds, and lower copper sales volumes.

Finally, the Fruta del Norte operation contributed gold production of 30,160 ounces for the quarter. Newcrest acquired a 32% equity interest in the operation in April.

Outlook.

Newcrest has held firm with its guidance for FY 2021. It continues to expect gold production of 1,950,000 ounces to 2,150,000 ounces. It has also retained its copper guidance of 135,000 to 155,000 tonnes for the year.

Newcrest Managing Director and Chief Executive Officer, Sandeep Biswas, commented “Consistent with prior years we executed a number of planned shutdown events across our operations in the September quarter, which is reflected in our production and All-In Sustaining Cost per ounce.”

“We expect production to be higher in the December quarter and the Company is on track to meet its FY21 production guidance. Our world-class Cadia asset continues to impress, reporting its lowest ever quarterly All-In Sustaining Cost of $113 per ounce, equating to an AISC margin of $1,724 per ounce for the quarter.”

“This showcases the strength of Newcrest’s unique technical capability as one of the few mining companies globally able to do block cave mining, which underpins Cadia’s performance,” he concluded.

More reading

• 5 things to watch on the ASX 200 on Thursday
• How did ASX gold shares perform in the last quarter? 
• ASX 200 Weekly Wrap: ASX snaps winning streak… just
• 5 things to watch on the ASX 200 on Monday
• Why the Iluka (ASX:ILU) share price nearly halved today

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Newcrest (ASX:NCM) share price tumbles lower following Q1 update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3mBytDB