Reporting Season Summary: 20 Feb 2014
About the author:
- Author name:
- By Fiona Buchanan
- Job title:
- Co-Head of Research, Senior Analyst
- Date posted:
- 20 February 2014, 3:39 PM
- Sectors Covered:
- Property, AREITS
Leighton Holdings (LEI)
1H14 Result
NPAT: A$508.7 million; Dividend: 60cps
The result beat expectations.
Morgans comment
Stock will remain strong while headline figures are taken as a fair reflection but we believe the price will weaken strongly when all these details are worked through.
Super Retail Group (SUL)
1H14 Result
NPAT: A$61.6 million; Dividend: 18.5cps
The result was in-line with expectations.
Morgans comment
We expect a positive reaction to this trading update, however the stock may still be in the sin bin for a bit longer yet post the 1H miss. For full comfort from the market, we may need to wait for the May trading update, but we still believe the stock is attractive at current levels.
AMP Limited (AMP)
1H14 Result
NPAT: A$849 million; Dividend: 23cps
The result beat expectations.
Morgans comment
The result upside was driven by a strong performance in AWM, up 16% on the pcp, supported by a 14% increase in FUM due to improving cashflows and positive market movements. Margin decline of 4bps to 121bps is within AMP's guidance expectations. AMP Bank is now also becoming a meaningful contributor, increasing its profit by 34% on the pcp, to A$83m.
Treasury Wine Estates (TWE)
1H14 Result
NPAT: A$25.7 million (underlying); Dividend: 6cps
The result was in-line with expectations.
Morgans comment
Guidance has been retained at A$190 to A$210. New CEO appointed. The interim dividend of 6c is in-line with consensus, but represents a payout ratio of 150% (on underlying earnings), well above the 55% to 70% guidance range. While this dividend is currently supported by the one-off tax benefit, it is clearly unsustainable.
Acrux (ACR)
1H14 Result
NPAT: A$25.4 million; Dividend: 12cps
The result beat expectations.
Morgans comment
Axiron now launched in Australia, Canada and Brazil with EU approval in Germany received and launch expected by end of February. Management expect that another milestone payment will be received in early 2015 as another sales milestone is achieved.
Adelaide Brighton (ABC)
1H14 Result
NPAT: A$151 million; Dividend: 19.5cps
The result beat expectations.
Morgans comment
Strong result and capital management is a positive, but we believe this is largely in the share price and are somewhat cautious about a period of adjustment following the exit of long-standing MD Chellew.
Auckland International Airport (AIA)
1H14 Result
NPAT: A$87 million
The result beat expectations.
Morgans comment
AIA is a solid investment proposition but remains fairly valued at 16x EV/EBITDA vs its historical average 13x.
Breville Group (BRG)
1H14 Result
NPAT: A$31.7 million; Dividend: 14cps
The result beat expectations.
Morgans comment
The outlook commentary suggests no changes to consensus. Company is expecting more of the same and looking for FY14 earnings to approximate FY13.
Decmil Group (DCG)
1H14 Result
NPAT: A$25.7 million; Dividend: 4.5cps
The result beat expectations.
Morgans comment
Today's result highlights the diversification strategy away from mining and WA has helped cushion the group from the downturn in the sector. We continue to back management to further diversify the business away from mining and with plenty of cash on hand, a number of opportunities remain including further BOO in different industries.
Emeco Holdings (EHL)
1H14 Result
NLAT: A$16.3 million (loss)
The result missed expectations.
Morgans comment
Operating result behind expectations however utilisation has ticked up materially and cash flow and debt amortisation are significantly better than expected.
Envestra (ENV)
1H14 Result
NPAT: A$87.1 million; Dividend: 3.2cps
The result was in-line with expectations.
Morgans comment
Given APA's scrip-based takeover, ENV's share price is now intimately linked to APA's share price. Based on our $6.17 target price for APA, the fair value for ENV is $1.18. It may be worth taking some profits in ENV at current prices, if you expect APA's share price to retreat.
Fletcher Building (FBU)
1H14 Result
NPAT: A$154 million; Dividend: 18cps
The result missed expectations.
Morgans comment
Expect the stock may be softer post the result but with no change to our longer term thesis any weakness should be viewed as a buying opportunity. No change to our preference for FBU across our building materials universe. We believe FBU will deliver multiple years of solid earnings growth, driven by the 3C's (cycle, Christchurch and cost-out).
iiNet (IIN)
1H14 Result
NPAT: A$29.1 million; Dividend: 9cps
The result was in-line with expectations.
Morgans comment
This was a good underlying result with the key positive surprise being net subscriber adds of 16k for the half (vs 4k in the pcp/our forecast). We were optimistic that IIN would beat our forecasts but it has exceeded our most optimistic expectations.
Origin Energy (ORG)
1H14 Result
NPAT: A$381 million; Dividend: 25cps
The result was in-line with expectations.
Morgans comment
Behind at the EBITDA level but ahead at the NPAT due to lower than expected net interest costs. We expect the stock is likely to be weaker given miss at the EBITDA line suggesting weaker than expected underlying performance. Energy markets are still being impacted by discounting in previous and current periods.
PanAust (PNA)
1H14 Result
NPAT: A$36.3 million; Dividend: 3cps
The result was in-line with expectations.
Morgans comment
Net operating cashflow of US$171m was ahead of our expectations (US$140m), on lower tax payments and receipts from derivatives. Overall cashflows post capex and financing were in line with our numbers. US$50.1m of impairments relating to exploration and development write-off's were disappointing.
Tatts Group (TTS)
1H14 Result
NPAT: A$122 million; Dividend: 8cps
The result was in-line with expectations.
Morgans comment
Strong start to year with revenue up 7% yoy. Lottery has been strong (due to jackpots) and wagering up 3.3%, driven by good tote win margins but fixed odds margins have seen softening.
More information
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