ASX News LIVE | ASX to Rise; Seven Group Makes Bid for Boral; Cochlear and A2 Milk Report

The ASX 200 closed flat +0.09% at 7,665.1 after a subdued day in which the interest-sensitive Real Estate (-2.63%) sector largely dragged down the market.

Heavy losses from Lendlease Group were to blame as the group fell nearly -15% after its latest earnings showed that tough times are ahead amid a -$136 million loss.

To investors ‘ disappointment, the company also cut its outlook and posted an interim dividend of just under 6.5 cents.

The rest of the real estate sector fell with them, with all of the top 10 market cap companies falling today.

On the other end of the market, Telecoms were up by +0.75%, followed by Financials, gaining 0.73%.

In stand-out individual performances, APM Human Services jumped nearly 50% after news broke of a planned takeover bid.

Meanwhile, mining-tech company Imdex also saw strong gains of 17.45% after a solid half of earnings in which it upgraded forecasts.

Sayona Mining also had a stellar day, gaining 16.36% after it appears more short-seller positions were squeezed out with the market lift.

Star Entertainment Group [ASX:SGR] shares are once again halted today as the company faces a second major inquiry into its Sydney casino operations after the NSW casino regulators said they were not satisfied the company had made sufficient changes to have its licence restored.

SGR shares are down nearly 60% in the past 12 months as the company struggles to regain momentum after continuous setbacks to its Sydney casino operations.

The prior inquiry outlined what it called ‘cultural failings‘ at the company, which were described as a culture that ‘condoned unethical conduct, prioritised business goals over compliance objectives, courted risk and discouraged bad news‘.

The company also has civil cases from the financial crimes watchdog ASIC against former executives and directors, which are expected to be heard next year.

ASX 200 is up by +0.23% to 7,675.5 on a fairly subdued day as markets remain cautious during earnings season.

Six of the sectors are up today, while five remain in the red, with the best performers in the mining sector, with Materials up +1.01%, while Real Estate is down -2.28%.

Big falls in Lendlease Group (-15.5%) plus drops in all of the top 10 real estate companies have weighed on markets at midday as interest rate concerns loom.

Meanwhile, major miners saw some relief, with BHP up +1.6%, Fortescue up 1.59%, and Rio gaining 1.86% as iron ore futures climbed 1.3% and the government supports the struggling nickel sector.

In other news, APM Human Services has jumped nearly 50% after news came out CVC Capital Partners was in talks to acquire the struggling employment services company.

Cochlear [ASX:COH], the global market leader in hearing implants, celebrated a successful first half with strong sales and profits.

They announced a 29% increase in their interim dividend to $2 per share, rewarding investors with a healthy 68% payout of underlying net profit and its highest dividend in around a decade.

Key highlights:

• Sales revenue: +25% to $1.11 billion
• Net profit: +35% to $191 million
• Dividend boost: +29% to $2 per share

This strong performance was driven by robust growth in both hearing implant sales and sound processor upgrades. With a solid balance sheet and strong cash flow, Cochlear feels confident in sharing its success with shareholders through this increased dividend.

Shares fell by -2.65 % in trading this morning despite an upgrade of its FY24 outlook to a Net profit of $385-400 million, a 26-31% increase on FY23.

Investors may be concerned about rising costs as operating costs rose in line with a 23% jump to $810 million. Operating expenses are now 41% of sales revenue.

A2 Milk Company [ASX:A2M] shares are up over 15% in trading this morning as the company releases 1H24 results.

After a tough few halves for the milk company, it has managed to inch up its revenue and profits in the first half of FY24 thanks to growth in its Chinese products.

Revenue is up by 3.7% to $812.1 million, while EBITDA is up 5% to $113.2 million with a margin of 13.9% (up 0.2pts)

Earnings per share gained 18.6% to 11.8 cents while net cash was up $34.9 million to total $792.1 million for the half.

A2 said the Chinese market was still ‘challenging‘ but had shown ‘early signs of stabilisation‘.

Infant formula sales were up 1.5% in total, but Chinese labels saw sales up 10.4%, while English label sales fell 6.9% over the half.

The company updated its guidance, saying that FY24 revenue growth had improved from the prior outlook to ‘low-to-mid single digit percent growth‘ expected.

Mining tech company Imdex [ASX:IMD] has seen its shares jump by over 20% in trading this morning as the company reported strong earnings.

The company reported revenue of $235 million for the half, up 18% from 1H23’s $198.8 million.

EBITDA normalised was also up 13% to $71 million, while earnings margins were at 30%, up from 28.1% in the PCP.

Net profits after tax finished at $32.8 million, up from $30.5 million in the PCP.

Dividing its revenues by region, it was clear that its major earning growth was seen in the Americas, up 31%. The same couldn’t be said for its Asia-Pacific segments which fell -1% over the half.

The tech support company says supply gaps across commodity markets will drive medium to long-term growth for the company as future resources will be deeper and in more complex geologies.

Seven Group, controlled by billionaire Kerry Stokes, is making a play for the remaining shares of building materials giant Boral [ASX:BLD]. The company already owns over 70% of Boral’s stock, but now wants to acquire the rest.

Under the proposed deal, Seven Group would offer 0.1116 of its own shares plus $1.50 in cash for each outstanding Boral share. This values each Boral share at $6.05.

The offer comes with sweeteners:

• +10c per Boral share if Seven Group reaches 80% ownership: This additional incentive encourages remaining shareholders to sell.
• +10c per Boral share if Seven Group triggers compulsory acquisition at 90.6%: This ensures all remaining shareholders are bought out at a premium.

This move comes after Boral reported a strong financial performance, with a 36% profit increase and 9% revenue growth in the last six months.

Seven Group believes acquiring the remaining Boral shares will boost Boral’s performance and long-term growth. Integrating Boral aligns with their strategy, increasing their flexibility and access to cash flow.

Borals shares are up by +3.20% in trading this morning.

Good morning. Charlie here

The ASX 200 opened up +0.11% to 7,666.4 this morning, creeping near a record high despite taking a weak lead from Wall Street.

US markets will be closed on Monday for Presidents Day, so we look to the wider markets for direction tomorrow.

Slightly higher than expected CPI data in the US was enough to push down US markets, while the UK’s FTSE 100 and Japanese Nikkei 225 are both near record highs despite both countries hitting technical recession at the end of last week.

Meanwhile, Bitcoin passed the US$52k mark at overnight. Bitcoin has passed the US$1 trillion market cap level for the first time in two years.

Wall Street: Dow -0.37%%, Nasdaq -0.82%, S&P 500 -0.48%.

Overseas: FTSE +1.50%, STOXX +0.47%, Nikkei +0.86%, SSE closed

The Aussie dollar fell -0.06% to US 65.28 cents.

US 10-year bond yields rose +5bps to 4.28%.

Australian 10-year bond yields rose +7bps to 4.20%.

Gold is flat at US$2,013.15, while Silver is flat at US$23.42.

Bitcoin rose +1.15% to US$52,281, while Ethereum rose 3.35% to US$2,882.

Oil Brent rose +0.13% to US$83.58, while WTI Crude rose +1.73% to US$79.38.

Iron ore rose +1.3% to US$131.10 a tonne.