In this section we look at all the important announcements affecting companies this week.

  • Westpac (WBC) – CEO Brian Hartzer has taken a stab at NAB, who recently announced a massive restructure to slash 4000 jobs and transform its bank into the bank of the future with state of the art tech. Hartzer’s response was that NAB is playing catch up and slashing jobs isn’t the way to make real structural improvements in costs. WBC posted an underwhelming result. FY cash profit was up 3% to $8.062bn under a consensus expectations for $8.162bn. But the result was marred by $118m to compensate customers. The bank may also shot itself in the foot after it decided to go ASIC in court. The Federal Court threw out its claim that it was being unfairly prejudiced on the accusation that it had rigged the bank bill swap rate. NAB and ANZ were a lot smarter, they both landed an out of court deal. What was WBC thinking? It might end up paying a lot more if they lose the trial.
  • James Hardie Industries (JHX) – Is purchasing a fibre gypsum board maker Fermacell GmbH from Xella International for $716.8m. The deal is expected to paid by debt and will be earnings accretive in the 2H.
  • Ardent Leisure (AAD) – CEO Simon Kelly has announced his resignation only 6 months into the role. What makes matters worse is that he hasn’t really given any reason for his departure. After last year’s fatal accident at Dreamworld, earnings at the adventure park have been shaky. The only part of the business that is doing well is the Bowling and Entertainment division.
  • Telstra (TLS) – Has proactively contacted the ACCC and advised them that its speed boost NBN plan was in-fact a lemon. It was misleading and was unable to provide the fast speeds it promised.
  • Westpac (WBC) –
  • Virgin Australia (VAH) – Has issued a trading update which underlined higher earnings and revenue over the next two quarters and privatisation talks given its small free-float. VAH posted an underlying profit of $18m up from last year’s loss. The company expects the underlying performance for the 2Q and 3Q to continue to improve compared to the prior corresponding period.
  • CBA posted a bumper 1Q profit result which was a lot stronger than its peers. Quarterly cash earnings came in at $2.65bn which beat analyst expectations for a $2.55bn profit. The bank also produced a rise in NIM and fall in bad debts.
  • Livehire (LVH) – Morgans has upgraded the stock on the back of the stock’s recent 16% pullback. It has upgraded to Add from Hold and it expects it to continue signing up new customers for Talent Community systems in coming months.
  • Myer (MYR) – Is now engaging with major shareholders as activist investor Solomon Lew releases his team of nominees for the Myer board. They include former Myer Grace Bros chief Terry McCartney, former UBS managing director Tim Antonie and former Federation Centres CEO Stephen Sewell. But inviting Lew’s nominees to the board without a full takeover, is supplying a major competitor with an advantage.
  • BitCar is looking for more than US$20m in a cryptocurrency IPO that will offer shares in exotic cars through a Bitcoin platform. Those that subscribe to BitCar’s ICO could be in the running to win a Lamborghini Huracan. BitCar is looking to attract supercar enthusiasts and young tech investors who have made money from cryptocurrencies.
  • Xero (XRO) – Will join the ASX 200 Index after it delists from the New Zealand Exchange and consolidates on the ASX from January 31 2018. The move has shocked NZ investors and the stock has fallen by 4.3% to NZ$32.60. The company announced positive earnings (EBITDA) for the first time in its history. It posted NZ$5.4m for the six-month period ending on September 30, 2017.
  • AuMake (AU8) – Australia’s only Daigou business rises 25% this week after the company purchases wool manufacturer Jumbuck Australia. The deal comes after it bought Health Essence, a health supplements business. It’s a booming business. The company says it has at least 20 business enquiries every day from businesses / people wanting access to China and Chinese tourists. The demand for Aussie made products in China is high.
  • Flight Centre (FLT) – Share rose after the company delivered an optimistic outlook for FY18 earnings. The company is expecting a solid half that could drive profit up by 15%.
  • Westfield (WFD) – Is up 11% this week on speculation that Brookfield Asset Management may have held talks with GGP to buy the rest of the mall owner it doesn’t already own. Westfield has 33 malls in the US.