The ASX 200 is up 103 points in mid morning trade, despite negative o/n leads. Gold the highlight, Materials and IT OK, while TLS ex-drags and banks ↓. MQG capital raising, MTS AGM and update and results mostly well behaved. VAH & BAL worst. CAJ, APT, BGA ok. #ausbiz


  • Earnings – Bellamy’s (BAL), Afterpay Touch (APT), OZ Minerals (OZL), Cash Converters (CCV), Virgin Australia (VAH),
  • Ex-dividend – Alumina (AWC) 6.5c, Bingo Industries (BIN) 2.0c, Contact Energy (CEN) 20.8c, Coles Group (COL) 35.5c, Fletcher Building (FBU) 12.1c, FSA Group (FSA) 3.0c, HiTech Group Australia (HIT) 4.0c, Kina Securities (KSL) 3.4c, Mainstream Group Holdings (MAI) 0.5c, McMillan Shakespeare (MMS) 40.0c, QV Equities (QVE) 2.2c, Telstra (TLS) 8.0c
  • Economic data – Construction Work Done


  • Macquarie Bank (MQG) – Capital Raising $1bn insto and SPP.  Follows recent net capital investment across most regions, primarily by Macquarie Capital in the renewables, technology and infrastructure sectors and an anticipated increase in capital deployment by Macquarie Asset Management and Macquarie Capital. 1H20 guidance: currently expects the 1H20 result +10% on the 1H19 result but down on a strong 2H19, which benefited from increased contributions from the markets-facing businesses; Maintains full-year outlook: While the impact of future market conditions makes forecasting difficult, we continue to expect the Group’s result for FY20 to be slightly down on FY19.
  • Metcash (MTS) – AGM and Trading Update


  • Afterpay Touch (APT) – FY19 global underlying sales +140% to $5.2bn Run-rate in excess of $7.2bn. Active customers +130% to 4.6m at end FY19 and in excess of 5.2 million currently. Currently on-boarding over 12,500 new customers per day. Active merchants of 32,300 at end of FY19, up 101%, and 35,300 currently; US and UK growth exceeding expectations – major new merchant brands continue to on-board; US underlying sales of nearly $1 billion in FY19. Run-rate in excess of $1.7 billion. Pro forma EBITDA (excluding significant items) stable at $35.5m.
  • National Storage REIT (NSR) – A-IFRS profit after tax of $144.8m; FY19 underlying earnings +21% to $62.4m; FY19 underlying EPS of 9.6 cps in line with guidance; Total Return for FY19 of 15.0%; Final distribution of 5.1, total FY19 distribution to 9.6c; Total AUM +36% to $1.95bn; NTA +8% to $1.63; $403 million in acquisitions settled in FY19, up 160%; FY20 guidance – underlying EPS growth of greater than 4%
  • Bega Cheese (BGA) – NPAT -59% to $11.8m on revenue +13%.
  • Oz Minerals (OZL) – NPAT -67% to $44m reflects shipment timing and increased growth investment; Revenue -21% to $Market dynamics favouring strong Q3 shipping schedule; all 2019 production tonnes committed; Carrapateena on schedule for first concentrate production in November with over 100kt of development ore stockpiled; expansion studies progressing; West Musgrave project evaluating multiple potential value-add opportunities; PFS completion and maiden Ore Reserve expected early 2020; Low risk, modest capital hub strategy developed for Carajás and Gurupi provinces; Exploration growth pipeline expands with new earn-in agreements in the Carrapateena province and Sweden and a new joint venture created for the Jericho project in Queensland
  • Bellamy’s (BAL) – Transformational rebrand is set to return the business to growth and is gaining momentum since March launch; Strong Q4 sales result following a deeper level of trade destocking in Q3 than first anticipated; Leading consumer indicators are positive, including an uptick in e-commerce sales, brand interest, Step 1 and Step 2 recruitment in China, consumer pricing and trade economics; FY19 was a challenging period; impacted by regulation, a lower birth rate and increased competition for Chinese demand; FY19 net revenue of $266m and normalised EBITDA was $47m (17.6%); Continued gross margin expansion to 43.5% in FY19 (39.2% FY18) beyond functional product upgrades including the addition of DHA and GOS across formula range; Increased investment in marketing, China capability and a breakthrough new product pipeline; Strong balance sheet and cash conversion that supports Bellamy’s growth agenda with $112.4m in net cash. Outlook for FY20 is: 10-15% group net revenue growth at an EBITDA margin consistent with last year, with revenue growth anticipated to accelerate in 2H20 with new product launches; continued strong gross margin and investment in marketing and China capability. Bellamy’s remains confident in its growth strategy and medium-term target of $500m revenue but has deferred this target beyond FY21 given the ongoing SAMR registration process





US EQUITIES – S&P500 -9 (-0.32%), Dow Jones -121 (-0.47%), NASDAQ -27 (-0.34%)

Main themes

  • Initial gains lost
  • Yield curve inversion worsened
  • Risk aversion theme

EUROPEAN MARKETS – Mostly higher. STOXX600 +0.63%, UK FTSE -0.08% the exception, German DAX +0.62%, French CAC +0.67%.


  • The USD is weaker at 97.98.
  • The Aussie is also lower at US67.58.

BONDS – 2-yr: -2 bps to 1.53%, 3-yr: -4 bps to 1.44%, 5-yr: -4 bps to 1.39%, 10-yr: -6 bps to 1.49%, 30-yr: -7 bps to 1.97%


  • Oil – WTI futures were up US73c to US$54.37.
  • Iron Ore – CommSec has iron ore down 2.9% to US$83.10 a tonne.
  • LME metals – Mostly lower. Cu -0.45%, Ni -0.25, Al -0.54%


  • US economic data – August CB Consumer Confidence Index 135.1 (consensus 129.6, prior 135.8 revised from 135.7), third highest reading since October 2000. Reflects a pretty solid state of consumer confidence.
  • Chinese stimulus – considering relaxing and removing restrictions on auto purchases as part of a broad move to boost consumption
  • Italian politics – The ruling Five Star Movement (M5S) and opposition Democratic Party (PD) struggling to form a new coalition. M5S suspended negotiations until PD committed to return outgoing Prime Minister Giuseppe Conte.

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