ASX plunges more than 8 per cent on Thursday following TPG blunder
'The ASX also revealed this morning that it expects the ASIC inquiry is going to cost roughly $25 to 35 million dollars during the new financial year, to pay for things like legal expenses, additional resourcing and the establishment of a secretariat,' Mr Boyd said.
ASX Limited finished down more than 8 per cent on Thursday.
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News.com.au
19 minutes ago
- News.com.au
Criterion: Companies have cash to splash and it's raining down on shareholders
Several big-name companies are tipped to announce share buybacks or special dividends this reporting season Share buybacks improve earnings per share and usually result in long-term share support JB Hi-Fi is tipped to pay a special dividend when it reports on Monday As local profit reporting unfolds in earnest next week, investors can expect a slew of companies to announce share buybacks or special dividends to soak up excess capital. To some investors, returning capital is a sign that management has run out of growth ideas - a strategic capitulation. To most, remitting the spare cash makes better sense than either hoarding it or pursuing a hare-brained acquisition. 'If a company doesn't have attractive investment opportunities and the balance sheet is starting to look lazy, a special dividend can make a lot of sense,' says Lazard Asset Management's Aaron Binsted. 'It also demonstrates that a board takes shareholder funds seriously and the market is more likely to support that company in future endeavours.' Don't stash the cash Share buybacks involve a company buying back its own shares and cancelling them, thus reducing the capital base and improving earnings per share. Boards often deploy buybacks when they think the market undervalues the shares. (Mind you, almost every board thinks that). In February Telstra (ASX:TLS) announced a $750 million buyback which it completed in June. Others including ResMed (ASX:RMD) and Corporate Travel Management (ASX:CTD) have buybacks in place. According to Sandstone Insights, capital returns usually result in share prices being supported well beyond the announcement date. 'There is an enduring impact on outperformance,' says head of investment strategy John Lockton. Buyback 'likely suspects' The owner of Afterpay and the Square terminals, Block, Inc (ASX:XYZ) is surfing the resurgence of buy-now pay later and Square's strong growth in the US. Block has a $4 billion buyback program – extended from $1 billion last year - but yesterday's quarterly disclosure shows the actual purchases have been at a far more languid rate. This also highlights that while a company might have announced a program, it's under no obligation to buy. With tapering capex, logistics house Brambles (ASX:BXB) could extend its recently-completed $600 million buyback. The beneficiary of favourable regulatory capital changes, annuities specialist Challenger (ASX:CGF) could start one. With insurers creaming it in, QBE Insurance (ASX:QBE) is in pole position to undertake its first-ever buyback. Earlier this year Suncorp Group (ASX:SUN) distributed the $4.1 billion proceeds of its banking operation to the Australia and New Zealand Banking Group (ASX:ANZ). There's a chance of a second helping. Special dividend candidates Discretionary retailers are among the most likely companies to declare a special dividend. Binsted notes that Super Retail Group (ASX:SUL) paid a special dividend in the last two financial year results 'and we suspect there may be a possibility for a third'. The company may have its high-profile corporate governance issues, but it has a solid balance sheet with tapering capex requirements. On Monday, JB HiFi (ASX:JBH) should post a bumper result – and perhaps pay a special div as it did last year. Media companies usually sound like they're down to their last dollar. But that's not the case at Nine Entertainment Company (ASX:NEC), which is heaving with $1.4 billion of proceeds from the sale of its Domain stake to Costar. Nine has flagged a shareholder return of 47-49 cents per share, but that accounts for only half the windfall. TPG Telecom (ASX:TPG) similarly is flush with $5.3 billion from the sale of its fixed asset business to Vocus. Pundits suggest TPG will return about half to shareholders. Great (earnings) Expectations In order to sweeten shareholder returns, companies need further earnings in the first place. That's not been the case over the last three years, with profits going backwards, Sandstone's Lockton expects current year earnings expectations to settle at 6%. This will be spurred by the tech sector with forecast 25-30% growth. For the time being at least, the market is willing to overlook the T – tariff – issue. Lockton says even if tariffs are disruptive, "there's a wall of interest rate cuts both in the US and Australia to save the day.' Enjoy the cash splash while it lasts.
The Age
an hour ago
- The Age
AI tells lies, but kindly apologises if found out
Go bold, Albanese Unfortunately for us Labor faithful, Prime Minister Albanese lacks the courage and boldness to lead a government of true reform. He once again ruled out tax reform (″ Albanese Shies Away from Major Tax Reform ″, 8/8). He's the manager doing things right, rather than the leader who chooses to do the right thing. Significant tax reform might put a few noses out of joint, but with a large majority and political momentum now is the time for some boldness. Governments are elected to lead and make life better, but right now this seems as if it is far from the minds of Australian Labor. Albanese might reflect on the courage of the previous Victorian premier, Dan Andrews, as an example of bold political leadership. Like him or not, Andrews was often courageous and doing the right thing defined his leadership. No one can deny the strength of his government which chose many real tangible actions to improve life for Victorians. They were certainly rewarded at the ballot box. Michael Cormick, Carnegie Defence is everything Italy has showed us the way. Everyone in the world can give Donald Trump a ″win″ on increased defence spending and none of that expenditure will be wasted on actual weapons. Yes, a suspension bridge is defence spending! (″ Italy will build bridge to Sicily ″, 8/8). So how does this work for Australia? Simple. All our expenditure on modernising our electrical grid is strategic – we are protecting ourselves against interdiction of fuel imports. All road and rain infrastructure is defence spending – we need to ensure that our forces can quickly and efficiently get to where they need to be. So is health – we need to have a strong fighting force. And of course, all education spending is defence spending. We need fully rounded people in our defence forces. Foreign aid and foreign embassies are defence spending – soft power is the most effective way to maintain peace. In no time, Australia will be spending 10 per cent of GDP on defence. We should then be able to ask Trump for a 1000 per cent decrease in tariffs. Ken Richards, Elwood What fits the crime After reading the article by Jeremy Pudney about the role James Vlassakis played in the Snowtown murders, I was moved with compassion about a young man manipulated by John Bunting and Robert Wagner (″ Why it's right to release the youngest Snowtown killer ″, 8/8). Vlassakis is depicted as a troubled teenager who fell under an evil spell. However, I feel for the victims' families who must live with the trauma of losing a loved one to murder. It is an impossible task to meet the needs of both parties, revenge on one hand and forgiveness on the other. The old adage is that the punishment must fit the crime. Life is short and eleven lives were lost, and Vlassakis has lost 26 years of his life. Yes, some will be outraged, but this decision certainly seeks understanding. Julie Ottobre, Brunswick East Call time on pub test Re Letters 8/8. Please let's drop the 'pub test' as a measure of anything. Only a minority of the population are to be found in a pub and most of them will be slightly to fully inebriated and looking for a rest from the worries of the day. If you enter with clipboard and questions you'll probably learn a lot more about expletives than your chosen topic. No-one actually polls a pub. It's on a par with all the other economic nostrums – plucked out of the air. It's guesswork based on the prejudice of the campaigner. John Laurie, Riddells Creek Thank you, Isabel I felt very sick and collapsed while trying to get off at South Yarra station last Friday. A young nurse on her way to work at Cabrini Hospital came over to ask if I was OK, and called the wonderful paramedics who took my blood pressure and took me to the Alfred Hospital. Its staff were kind and professional, and after about five hours involving constant monitoring of my blood pressure, an ECG and a CT of my head, I was cleared to go home. I tried to contact the nurse who helped me on the train to thank her, but I couldn't as I only knew her first name, Isabel. There is a lot in the press about the inadequacies of our health system, but we should be so proud of our frontline health workers, doctors, nurses and paramedics and so grateful for their care. Catherine Needham, Parkdale AFL comedy channel I'm a bit disappointed at Channel 7's lack of imagination in dumping the broadcast of the upcoming Blues v Bombers game for August 21. It could have billed it as a comedy in the tradition of 1960s British Carry On films, featuring slapstick fumbling, dropped marks, missed goals and kicks and Keystone Cops-like packs chasing the ball. What a missed opportunity. Pier Paolo De Carlo, Ascot Vale Docklands mystery It's still a mystery after years of huge investments and planning that at lunchtime I see an empty Docklands. On the north facing boulevard to the library on a perfect, sunny Friday, restaurants are derelict and not one person is on the moored megayachts. Every time a new iconic tower is completed the street life seems to decline. Is this what was planned, and if not what changes are needed? Robert Irvine, Sunbury AND ANOTHER THING Work from home Our roads are in an abysmal state of disrepair, so it will be interesting when those employed to fix the innumerable pot-holes decide to work from home. Helen Moss, Croydon I look forward to train, tram and taxi drivers, ambulance crews, policemen and garbage collectors all working from home. Les Aisen, Elsternwick The sheer scale and volume of the pushback against Jacinta Allan's stance on protecting the current WFH arrangements clearly demonstrates that such protection is needed. Geoffrey McNaughton, Glen Huntly Furthermore It is beyond appalling that Kathleen Folbigg has been awarded a measly $2 million as compensation for being wrongly convicted of killing her children and imprisoned for two decades. Robyn Westwood, Heidelberg Heights Re ″ Talking parrot brings down gang turns stool pigeon ″ 8/8. At last we know why there's a dearth of orange bellied parrots on the Bellarine. They've joined the police force. Margaret Skeen, Pt Lonsdale Geo-politics Australia appears to have an even-handed approach to the war in Ukraine, providing aid to Ukraine while simultaneously buying Russian oil from India, leaving our feet free to kick the Ukrainian people when they are down. Ken Machin, Grovedale Let's say nyet zero to Aussie cars running on crude oil from Russia. Paul Custance, Highett
Perth Now
3 hours ago
- Perth Now
ASX dips ahead of expected RBA rate cut
A mixed bag has capped the share market's first weekly gain in three weeks, in the midst of reporting season with an expected interest rate cut just days away. The S&P/ASX200 closed Friday with a loss of 24.3 points or 0.28 per cent at 8807.1. Sell offs in financials and healthcare outweighed gains in mining stocks, with six of 11 sectors in negative territory. The All Ordinaries also slipped 0.28 per cent, down 25 points to 9,076.6 while the Small Ords was flat. Daily returns were dominated by earnings results. QBE shares tanked 8.8 per cent (to $21.39) despite the company reporting a 20 per cent jump in half-year profit. Afterpay owner Block rose 9.1 per cent (at $127.09) as second quarter results showed consumers were blowing cobwebs off their wallets. Gains in mining did not offset losses in financials. Gaye Gerard / NewsWire Credit: News Corp Australia Furniture retailer Nick Scali lifted 6.9 per cent (to $20.49) as its Australian and New Zealand orders over the second-half rose 7 per cent. Investors made themselves comfy despite a near 30 per cent slide in profits. 'We're getting better deals … and we are passing that through to the consumer for better prices and that is probably helping us,' chief executive Anthony Scali told investors. 'I think the consumer is a bit more confident.' Other big gainers include finance tech company Iress (up 12.2 per cent at $9.40), Pilbara Minerals (up 9 per cent at $1.93) and AMP (up 7.1 per cent at $1.87). At the other end, GQG Partners was deep in red territory. GQG's share price fell 14.6 per cent (to $1.72), as a funds under management update revealed an exodus. RBA Governor Michele Bullock is expected to announce a rate cut on Tuesday. NewsWire / Nikki Short Credit: News Corp Australia Investors ditched game company Light and Wonder, as the Las Vegas-headquartered firm announced plans to delist from the Nasdaq later this year. Aussie-listed stocks fell 11.2 per cent to $118.75. The RBA is expected to cut the cash rate on Tuesday, and will take heed from London in doing so. The Bank of England cut its main interest rate Thursday by a quarter point to 4 per cent, to spite a lagging economy. In international news, the UK, Switzerland and the US have found themselves in a tussle after a report Donald Trump had imposed tariffs on imports of 1kg gold bars. Independent market analyst Stephen Innes said the US administration was taking a three-pronged approach. 'Weaken Switzerland's refining monopoly. Force London's bullion banks into a defensive posture. Supercharge the fiscal optics by goosing gold's domestic valuation,' he said. 'The optics are unmistakeable. At a time when central banks are hoarding gold to diversify away from dollar risk, Washington is slapping toll booths on the global metal highway. 'Switzerland, the middleman in this high-value supply chain, just became collateral damage.' The news sent gold futures climbing to a record high on Friday, even after a stellar week for the precious metal. The S&P/ASX All Ordinaries Gold benchmark is up 11.5 per cent for the week, including a 2 per cent sweetener on Friday.
