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As you may have already noticed, August means corporate reporting season.
It’s a twice-a-year insight into how your share investments are really performing, as opposed to the daily noise of what their price is doing.
So that’s why you’re seeing a lot of discussion about company profits this month.
For the last few weeks companies have been updating the market (via statements to the ASX) with their latest half-year or full-year financial results.
The chief executives and senior leadership team of these companies also deliver presentations to investors, because they are the ones who buy shares in the companies listed on Australia’s stock exchange.
So, when it’s profit-reporting season, the news is focussed on letting investors know how their investments are tracking.
But there’s often some large numbers involved, many of which are pretty confusing. That’s why my colleague Michael Janda helpfully broke down what it all means in this piece here.
Shares in Woodside Energy have increased 3.6% this morning after the company released its half year results.
The country’s largest independent energy firm posted a 14% drop in its underlying net profit after tax to $1.63 billion for the six months ended June 30.
It attributed the decline to lower realised oil prices amid weak demand signals from top importer China.
Woodside Energy chief executive Meg O’Neill said the results demonstrate how the business continues to deliver strong dividends to shareholders.
“We continue to deliver on our strategy to thrive through the energy transition while maintaining our disciplined capital management,” she said.
“…Above all, we are committed to continually improving safety and have focused on strengthening our safety culture, simplifying our processes and improving our systems.”
The directors have determined a fully franked interim dividend of 69 US cents per share.
There have been a flurry of results out this morning, including Mexican food chain Guzman Y Gomez.
GYG reported a pro forma net profit after tax of $5.7 million for the year ended June 30, compared with $3.0 million a year earlier.
GYG founder and co-chief executive Steven Marks said the results for the year demonstrated “solid guest demand for clean, fresh food delivered at high speed”.
He also cited “strong operation execution”.
“GYG delivered network sales growth of 26% for the year, ahead of prospectus forecasts,” he said.
“This result was underpinned by strong comparable sales growth and the continued delivery of restaurant network expansion across Australia.”
With annual inflation up 4% or so, is Coles going backward with only a 2.1% profit increase?
– David
Companies make choices that are reflected in their profits.
Do they invest in expensive tech? Do they expand into an expensive but potentially profitable sector? Do they try and improve the yield out of a particular division?
Journalists and analysts will be digging through Coles (and tomorrow, Woolworths) profits to try and find answers.
But there’s one thing we know already.
After the firestorm of last year’s profit result – which led to Parliamentary inquiries and scrutiny – the mega-grocers wouldn’t be going out of their way to maximise profit and then crow about it to the investment community.
The flagship ASX 200 index has opened flat, as tipped by the futures index.
In the opening minutes it is +0.2% higher, up 13-points to 8,097-points.
Investors are chowing down on corporate earnings and there’s new inflation data due tomorrow which will help set the tone of the central bank’s stance on the direction of interest rates.
The benchmark rose 0.8% on Monday.
For the visual thinkers out there, here’s what that looks like.
Coles has highlighted a few key figures in its 2024 performance:
Supermarket sales revenue of $39 billion increased by 6.2% on the prior year, including sales numbers in the fourth quarter
The grocer said sales growth was driven by its seasonal value campaigns and the successful execution of trade events for Christmas, Easter and Mother’s Day.
It also credited strong growth in eCommerce and improvements in availability.
The slight growth came despite cost of living pressures faced by consumers.
Coles said that inflation, excluding tobacco and fresh items, was 1.1%. It found grocery inflation had also moderated.
The Coles board has declared a fully franked dividend of 32 cents per share.
In case you’ve been ignoring the news for a while, serious allegations of criminality and coercion have been exposed by the media about dominant construction union the CFMEU.
Legislation to place the union in administration – have outsiders take over – has flown through federal parliament.
But the members of that union, and others sympathetic to both it and the imposition on people’s right to collectively organise, are rallying today in major capital cities.
Rallies are set for Sydney, Melbourne, Brisbane, Adelaide, Perth, and Cairns.
If you need a quick explainer, there’s a great one here.
In the past two years, inflation has rocketed the price of essentials, creating a cost-of-living crisis.
Mortgages have soared since May 2022 when the Reserve Bank started hiking interest rates to fight inflation, and rents rose rapidly off the back of that (as well as demand/supply issues and broader factors like people wanting more space after the COVID pandemic).
War in Ukraine and conflict in the Middle East have jacked the price of fuel (now coming down) which flows into other essentials like fertiliser, all of which impacts non-discretionary items like food.
Basically, housing, fuel and food – all essentials – have gone up massively, and quickly, as incomes have largely stagnated.
What does this have to do with Coles?
With its profit result out today – and giant grocer Woolworths out tomorrow – its results will be scoured for profit-taking at the expense of customers.
Even at a glance, the many technical ways you can slice and dice profit (EBITDA, underlying, NPAT, reported) give politicians and commentators ample ability to get stuck in.
We’ll bring you more as we chew through it, but when Woolworths reveals its numbers tomorrow, you’ll likely see the temperature turn up again.
Coles Group has reported a 2.1% increase in its statutory net profit after tax to $1.1 billion for the 2024 financial year.
There was a rise in sales revenue from its continuing operation of 7.6% overall.
The country’s second-largest grocer says the result was bolstered by strong growth in its supermarket sales volumes, and improved inventory management that effectively mitigated theft-induced stock losses.
Coles Group chief executive Leah Weckert acknowledged the results came as families were grappling with cost of living pressures.
“The financial pressures on households and families have been front of mind for us this year and we have endeavoured to deliver value across our supermarket, liquor and online offerings to help customers balance the household budget,” she said.
“At the same time, we have worked hard to deliver improvements in availability and quality, made significant inroads in addressing loss, accelerated our digital offering, continued to maintain a strong focus on costs and complete the construction of our second ADC and both our CFCs.”
BHP Group reported a +2% rise in its annual underlying profit, as growth at its iron ore and copper businesses helped offset weaker coal prices.
The world’s largest listed miner’s fiscal 2024 profit was underpinned by a record iron ore output for a second straight year and resilient average realised prices for the steel-making commodity.
Underlying attributable profit for the year ended June 30 came in at US$13.66 billion, beating a Visible Alpha consensus of $13.26 billion and ahead of the $13.4 billion profit a year ago.
BHP declared a dividend of $0.74 per share, below the prior year’s $0.80 apiece.
(Reuters)
The statements are chunking through the systems as we get information to you.
Holders of a share in Coles Group will get a dividend of 32-cents.
We’ll bring you the full accounts as soon as they are up.
Mega-miner BHP results are out:
More to come.
Coles has close to a third of the Australian supermarket-market, with tentacles into other fields like liquor, online delivery and services like insurance.
Its results come out shortly (Woolworths is tomorrow) and we’ll be here to take it apart for you.
After last year’s profit inflation, will we see a repeat?
ASX 200: +0.05% to 8,041 points (live values below)
Australian dollar: Flat at 67.70 US cents
S&P 500: -0.3% to 5,616 points
Nasdaq: -0.9% to 17,725 points
FTSE 100: +0.5% to 8,327 points
EuroStoxx 50: -0.3% to 4,396 points
Spot gold: +0.3% to $US2,516/ounce
Brent crude: +2.6% to $US81.19/barrel
Iron ore: +3% to $US98.05/tonne
Bitcoin: -0.5% to $US63,143
Prices current around 07:45am AEDT.
Live updates on the major ASX indices:
We’re more than halfway through corporate reporting season but this week is one of the busiest in the calendar.
Today, we’re expecting results from BHP, Woodside and Coles so stay tuned as we bring those to you.
This isn’t a complete list, but a quick snapshot of what else to expect in the coming days:
Tuesday: BHP, Woodside, Worley, Cooper Energy, Coles, Nanosonics, Johns Lyng, Integral Diagnostics, Siteminder, Lovisa
Wednesday: Flight Centre, Tabcorp, Woolworths, Fortescue, APA, Platinum Asset Management, Nine Entertainment, Karoon, Lynas Rare Earths
Thursday: Perpetual, Qantas, Wesfarmers, Sandfire Resources, IGO, Mineral Resources, Steadfast, Cromwell Property, South 32, IDP Education. Waypoint REIT
Friday: Downer EDI, Ramsay Healthcare, TPG, Dicketer Data, Star Entertainment
Hello there, Daniel Ziffer from the ABC business unit with you to start off our blog.
Grocer Coles reveals its profit result this morning. Last year’s figures prompted scrutiny about whether the supermarket sector was profiteering from high inflation and contributing to the cost-of-living crisis.
Overnight, Wall Street gave mixed signals to our market.
The key Dow Jones index of mega-companies closed +0.2% higher to 41,240-points, the broader S&P 500 index was -0.3% lower to 5,616-points and the tech-heavy Nasdaq is – at the time of writing, down almost a percentage point, -0.9% to 17,725-points.
Stay tuned, lots to get to.
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