Smart Group (SIQ): This small cap darling delivered a better than expected result for the financial year, reporting an increase of 2% in revenue to $125.8m and a 5% increase in net profit to $40.5m. Whilst not high level growth numbers on their own, the fact that they came during an incredibly difficult period for new car sales was seen as a substantial positive by the market. Smart Group is a salary packaging and vehicle leasing specialist, dealing with employees of non-profits and public hospitals as well as many for-profits that offer leases on business vehicles. There was substantial concern that the weakening economy and slowing property market would hit the company much harder. The company continues to benefit from recent acquisitions in a fragmented industry and is boosting margins through cross selling of their various packaging products. The company rallied strongly after the result and is one the core holdings in both the Pengana Emerging Companies and Lennox Australian Smaller Companies Fund.

A2 Milk Ltd (A2M): This high growth company hit a speed bump during the month, falling from a high of $17 to $13.5 at the time of writing. The company announced a strong profit result, increasing 47% to $287m on the back of 41% growth in revenue to $1.3bn; yet with success comes greater expectations. The market was disappointed by the result as management highlighted tighter margins due to an increase in marketing and advertising spend. The group also faces a double hit in their all-important Chinese market with several announcements that the Chinese plan to take control of their own milk powder sector and the move away from daigou shoppers to a more consistent business model. The company now trades on a multiple of 35 times earnings and a market cap of $10bn with little more than an excellent brand to support this.

Alumina Ltd (AWC): Another lesson in why it’s important not to follow the crowd when it comes to the most popular investment ideas is Alumina. The mining and aluminium smelting company had been touted by many of the most popular investment newsletters as a great dividend payer and must have stock. After being the highest dividend payer in 2018 yield hungry investors flocked to the commodity stock under the pretension it’s dividend was secure. Yet their FY19 results made for difficutl reading, with revenue down 12% and profit down 26% as aluminium prices continued to slump which resulted in a 49% cut in the interim dividend. The stock is now trading at close to three year lows.

Speedcast International (SDA): After ending the financial year at around $3.50 SDA has hit all-time lows of just $0.76 cents. The company, is a leading satellite communications service business, offering connections to remote areas and maritime vessels had been lumped in with the Australian technology sector and benefitted via a substantially higher valuation. The company has seen a double hit after warning of a substantial writedown of recent acquisitions in July and then delivering a 33% drop in net profit for the financial year. The roll up and consolidation strategy does not appear to be working to the disappointment of key shareholders Australian Super, UBS, Lazard and Norges Bank.