Record dividends and stellar earnings from some of Australia’s largest companies were welcomed warmly by investors and analysts alike this week. However, the spectre of COVID-19 still looms large over the ASX. Here’s what you need to know about week two of February earnings.
Miners deliver record payouts, plus some drama
BHP – NPAT: $US3.9 billion, Dividend: $US1.01 per share
Rio Tinto – Underlying profit: $US12.4 billion, Dividend: $US5.57 per share
Fortescue Metals Group – NPAT: $US4.08 billion ($5.2 billion), Dividend: $1.47 per share
The nation’s miners delivered a dividend windfall for investors this week, with both BHP and Rio announcing record payouts off the back of surging iron ore prices. Rio Tinto’s new boss Jakob Stausholm expressed hope the miner could restore trust after last year’s disastrous destruction of Aboriginal rock shelters, while BHP boss Mike Henry was confident on future commodity demands as COVID-19 vaccines roll out.
Fortescue Metals also paid out a record half-year dividend, though the company also delivered shock news of cost blowouts at its Iron Bridge project in WA.
NPAT: $US1.8 billion ($2.3 billion)
Dividend: $US1.04 per share
The blood plasma giant delivered blockbuster revenue and profit numbers, buoyed by an exceptional result from its vaccine business Seqirus. However, chief executive Paul Perreault was cautious about the outlook, warning that collection of plasma from donors in the US remains depressed due to the pandemic and that the business is managing inventory carefully to avoid future supply shortages.
“There is still a lot of fear in the US, with COVID still going quite rapidly around here. There are certainly times where people don’t want to be waiting too long [to enter donor centres],” he said.
NPAT: $1.4 billion
Dividend: 88c per share
Surging sales at Bunnings and Kmart have helped boost Wesfarmers throughout COVID-19 lockdowns, but chief executive Rob Scott warned that Australia’s management of the pandemic is causing difficulties for the business community and called for a national framework for hotel quarantine and more consistent decisions around snap COVID-19 lockdowns.
“There will always be a need [for lockdowns] in some circumstances, but an inconsistency in approach and snap decisions can result in enormous personal and business hardship,” he said.
NPAT: $560 million
Dividend: 33c per share
Wesfarmers’ supermarket spinoff Coles reported strong growth in the six months to December 31 though there are fears its coronavirus-driven sales boom may be coming to an end, with sales for the first three months of the new year growing just 3.3 per cent. Chief executive Steven Cain said the supermarket giant might delay or rethink new store openings in the coming months.
Treasury Wine Estates
NPAT: $120.9 million
Dividend: 15c per share
Treasury pleased investors by confirming that it was ditching plans to demerge its Penfolds brand and would instead look to sell off US brands. The wine maker is also looking to split its operations into three internal divisions as it contends with the anti-dumping tariffs imposed by the Chinese government. Chief executive Tim Ford said the company was not “walking away” from China, but was focused on building other markets outside of it.
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Source: Thanks smh.com