ASX 200 rose 56 points to 6834 as a rally in US markets helped buyers find their courage. Positive results and outlook statements also helped. The Dow futures rose points. The Big Bank Basket rose to $159.98. MQG slipped slightly down 1.1%. Insurers better as bond yields continue to push higher. Healthcare was mixed but CSL finally found some friends up 0.8%. Big Miners improved led by BHP up 3.2% and FMG up 3.1%. Gold miners down with NCM off 2.4% and NST falling 3.9%. In tech stocks, APT is currently suspended as it raised $1,5bn to buy part of the US business and a sell down by its founders. WTC fell 7.0% on broker comments following numbers yesterday and XRO rose 2.9%. The All–Tech Index rose 0.38% but given APT is a huge part of it, it could do anything tomorrow. KGN down 1.9% ahead of results tomorrow. In corporate news and there was plenty, QAN rose 1.8%, first-half loss coming in better than anticipated. No dividend. A2M down 16.2% as it downgrades guidance. NXT up 2.1%, upgrades FY21 revenue guidance. FLT rose 8.9% after an optimistic outlook statement helped, SSM crashed 21.4% on its results yesterday after hours. Didn’t help sentiment.  and Z1P also in the sellers’ spotlight after some lacklustre numbers prompted some profit taking, falling 7.7%. BVS +8.1% pulled out of its death spiral after results and some media comments of potential PE moves. JBH down 3.8%, trading ex-dividend. WPL up 2.7% despite trading ex-dividend. On the economic front, total new capital expenditure rose by 3.0% in the December quarter ahead of estimates of a 0.2% fall. In 10-year bond yields another big rally up to 1.72%. AUD 79.72c. Asian markets better with Japan up 1.5% and China up 1.4% with HK bouncing back by 2.1%

Today’s Highlights

• ASX 200 up 56 to 6834.
• High 6857 Low 6792.
• Big Bank Basket rallies to $159.98
• All Tech Index up 0.38%. APT suspended.
• Dow Futures up 108.
• Gold dips to AUD$2256 as dollar rises.
• 10-year yield booming to 1.72%
• AUD rises to 79.72c
• Bitcoin rebounds to US$50293.
• Asian markets better with Japan up 1.5% and China up 1.4% with HK bouncing back by 2.1%.

STOCKS

• SSM -21.41% results hit.
• A2M -16.17% sours on Daigou issues.
• Z1P -7.67% good start bad finish.
• TPW -6.61% best is behind it.
• WTC -6.90% broker downgrades.
• 360 +18.99% good results.
• VUL +10.69% bargain hunting.
• NAN +9.53% broker comments more optimistic.
• BVS +8.15% results and M&A potential.
• ZNO -7.59% disappointing reaction to numbers.
• MYD -7.73% follows TPW down.
• TGF +7.25% good day following presentation.
• RLE +26.51% Introducing Pure Hydrogen. Merger to be completed March 9th.
• TPG -3.42% broker downgrades.
• Speculative Stock of the Day: Peppermint Investment (PIL) +190.91% reinstatement to quotation after 16 months in the wilderness. Huge volume.
• Biggest Winners: 360, PLL, SFR, VUL, NAN, CUV, FLT, BVS and NUF..
• Biggest Losers: SSM, A2M, CSX, IFM, RRL, Z1P, WTC, RMS and TPW..

TODAY

• Macquarie Telecom Group (MAQ) –1.01% First-half profit $7m vs consensus $6.1m. Revenue $143.6m vs consensus $141.7m. EBITDA $36.4m vs guidance $36-37m. FY21 EBITDA is expected to be ~$72-75m. Total Capex is expected to be between $57-66m, excluding IC3.
• Catapult Group International (CAT) +1.47% First-half profit -US$4.5m vs consensus -US$3.7m. Revenue US$33.3m vs year-ago. US$34.7mCash and cash equivalents US$24.6M as at 31-Dec-20. Outlook: Expects to record a significant shift towards subscription revenue, away from capital revenue, in its Performance & Health solution from 1-Jan-21 onwards as a consequence of enhancements made to the associated technology platform and the customer terms and conditions. Catapult is reviewing its portfolio of global brands (including ~US$4m of acquired brands) and may consider rationalizing.
• Service Stream (SSM) –21.41% First-half adjusted profit $20.1m vs consensus $21.5m. Revenue $409.9m vs consensus $428.7m. EBITDA $40.2m vs consensus $42.0m. Interim distribution 2.5c, fully franked. Outlook: Expects the second-half result to be approximately in-line with the first-half.
• NextDC (NXT) +2.06% First-half statutory profit -$17.5m vs year-ago -$4.9m.Revenue $124.5m vs consensus $117.7m. Data centre services revenue $121.6m year-ago $95.4m. Underlying EBITDA $65.7m vs consensus $58.4m. Upgraded FY21 guidance: Data centre services revenue $246-251m vs prior $242-250m. Underlying EBITDA $130-133m vs prior $125-130m. CAPEX $380-400m (unchanged). CEO commentary: “Second half sales in FY21 have already exceeded our expectations and we expect further strong demand for our premium data centre services into FY22”.
• Qube Holdings (QUB) +1.62% reaches agreement on sale of Moorebank property assets to LOGOS for $1.65bn. Transaction: Qube has entered into a non-binding commercial term sheet to sell 100% of its interest in the warehousing and property components of the MLP project to LOGOS. Finalised binding transaction documents expected to be entered into during H2 FY21. Transaction subject to conditions including FIRB and MIC approvals. Intention is to establish a new governance structure between MIC, LOGOS and Qube.
• Flight Centre Travel Group (FLT) +8.87% H1 underlying Profit before tax -$247m vs year-ago $103m. Reports H1: Revenue $160m vs year-ago $1.55bn. Group total transaction value $1.53bn vs year-ago $12.40bn. FY21 outlook: Lack of clarity means it is impossible to provide FY21 guidance.Stable cost base – fixed costs now tracking below $70m per month – but ongoing uncertainty around exact revenue recovery timeframe given changing domestic & international border policies. Expecting domestic travel recovery in near-term as soon as border policies stabilise – permanent reopenings bringing an end to uncertainty. Possible resumption of low risk international travel during CY21 2H (FY22 1H) – paving way for return to profitability. Market consolidation expected – M&A, business closures – as support winds down before governments allow travel to resume.
• Regis Resources (RRL) -7.85% H1 Net Profit after tax $84.8m vs consensus $104.8m. Reports H1: Revenue $401m vs consensus $400.9m. EBITDA $198.6m vs consensus $186.0m. Fully franked interim dividend 4cps, fully franked. FY21 Guidance: Gold Production 355-380Koz. C1 Cash Costs including royalties $1,030 – 1,090/oz. All in Sustaining Cost $1,230 – 1,300 per ounce.
• Iluka Resources (ILU)+2.03% Full-year underlying profit $151.2m vs consensus $176.6m. Revenue $947m vs consensus $995.4m. Underlying EBITDA $423.1m vs year-ago $616m. Dividend of 2cps, fully franked. FY21 guidance: Zircon 285K tonnes (including around 60K tonnes of zircon in concentrate). Rutile 200K tonnes. Capital expenditure in 2021 is expected to be around $100m.
• Temple & Webster Group (TPW) –6.61% First-half profit $12.2m vs year-ago $2.9m. As per February unaudited figures: Revenue $161.6m vs year-ago $74.1m. Adjusted EBITDA $15.3m vs year-ago $2.7m. Outlook: H2 revenue to date (23-Feb) +118% vs year ago.
• PointsBet Holdings (PBH) +1.80% First-half net income -$71.8m vs consensus -$64.3m. Revenue $75.1m vs year-ago $27.4m and consensus $75.3m. Adjusted EBITDA -$69.0m vs year-ago -$28.4m and consensus -$67.6m.
• Qantas Airways (QAN) +1.80% First-half underlying profit -$1.03bn vs consensus $1.11bn. Revenue $2.33bn vs consensus $1.93bn. Underlying EBIT -$888.0m vs consensus -$983.1m. No interim dividend will be paid. Outlook: On track to deliver $0.6bn in structural cost benefits in FY21, $0.8bn by FY22 and at least $1.0bn in annual cost improvements from FY23 onwards.
• a2 Milk Co. (A2M) -16.17% First-half profit NZ$120.0m vs consensus NZ$135.9m. EBIT NZ$175.3m vs consensus NZ$178m. Revenue NZ$677.4m vs 17-Dec guidance of ~NZ$670m. FY Guidance (Jun 2021): Revenue NZ$1.4bn vs prior guidance NZ$1.40-1.55bn. The pace of recovery in the daigou/reseller channel and in the CBEC channel has been slower than previously anticipated and the company now expects revenue to be at the lower end of the previous guidance range. EBITDA margin of 24-26% (excluding MVM acquisition costs) vs prior guidance 26-29%. Due to lower revenue, higher brand investment, longer daigou/reseller support, movements in foreign currency and adverse channel mix relative to what was anticipated in December. Outlook for FY21 assumes the actions being taken to re-activate the daigou/reseller channel delivers a significant improvement in quarter-on-quarter growth from 3Q21 to 4Q21.
• TPG Telecom (TPG) -3.42% FY pro forma Net Profit after tax (NPAT) $282m vs consensus $268.5m. Reports FY: NPAT $734m. Revenue $4.35bn vs year-ago $3.51bn. EBITDA $1.39bn vs year-ago $1.18bn. On a pro forma basis: Revenue $5.52bn, -6% vs year-ago. EBITDA $1.79bn, -10% vs year-ago. Declared maiden dividend of 7.5 cps. Outlook: Expects total NBN headwinds of approximately $60m and an $11m negative impact from the RBS levy for the year.
• Southern Cross Media Group (SXL) -3.70%H1 Net Profit after tax $32.5 vs year-ago $20.4m. Reports H1: Revenue $259.2m vs consensus $242.7m. EBITDA $75.3m vs consensus $60.0m. Dividends: Subject to there being no material adverse change in advertising markets, SCA intends to recommence dividends by paying a final dividend for FY21. Any decision to pay a final dividend will be announced upon release of the full year results in August 2021.
• Ardent Leisure Group (ALG) +1.59% H1 Net Profit after tax -$83.6m vs year-ago -$25.8m. Reports H1: Revenue $137.6, vs year-ago $247.0m. EBITDA -$19.8m ex-items vs year-ago $19.0m.
• Atlas Arteria (ALX) -3.17% FY Net Profit after tax (NPAT) ex-items $69.6m vs consensus $104.7m. Reports FY: Revenue $106.7m vs consensus $131.7m. Statutory NPAT -$55.8m vs year-ago -$9.8m. Dulles Greenway impairment -$143.9m. Guides final DPS $0.13. YTD traffic update: APRR ~ – 25% vs year-ago. Warnow Tunnel ~ -25% vs year-ago. Dulles Greenway ~ -50%.

• Sandfire Resources (SFR) +11.11% H1 Net Profit after tax (NPAT) $60.8m vs consensus $57.0m. Reports H1: Revenue $355.6m vs consensus $333.6m. Cash flow from operating activities of $137.8m vs year-ago $109.1m. DeGrussa Operations segment EBITDA of $238.0m vs year-ago $182.2m. Group cash at 31-Dec-20 of $335.8m. 8.0cps interim dividend, Fully franked. FY2021 guidance: Positioning for upper end of guidance 67-70kt of contained copper and 36-40koz of contained gold, at C1 $0.85-A$0.90/lb.
• Clean TeQ Holdings (CLQ) -8.20% H1 Net Profit after tax -$10.1m vs year-ago -$10.3m. Reports H1: Revenue $1.6m vs year-ago $0.7m.
• Infomedia (IFM) –10.0% First-half profit $9.3m vs consensus $10.1m. Revenue $47.7m vs consensus $49.3m. EBITDA $22.4m vs consensus $24.3m. Interim dividend 2.15cps, fully franked. Outlook: Anticipate a return to consistent, sustained growth buoyed by recent strategic wins across all regions and remain committed to an aspirational target of doubling revenue to $200m by 2025.
• Growthpoint Properties Australia (GOZ) +2.29% First-half funds from operations (FFO) 12.7c vs year-ago 12.6c. Net property income $117.4m vs year-ago $121.4m. Net tangible assets/share 382c. Distribution 10c vs year-ago 11.8c. FY Guidance (Jun 2021): FFO in the range of 25.2-25.5c. Reaffirms distribution of 20c.
• Bravura Solutions (BVS) +8.15% First-half profit $19.8m vs year-ago $9m and consensus $8.8m. Revenue $135.1m vs consensus $125m. EBITDA $25.5m vs consensus $25.9m. Dividend 2.6c, unfranked. FY Guidance (Jun 2021): Profit of $32-35n. Anticipates revenue growth from 1H21 to 2H21 in excess of 10%.
• Ramsay Health Care (RHC) +7.74% First-half profit attributable to shareholders $226m vs consensus $177.1m. Revenue including government support $6.61bn vs year-ago $6.35bn and consensus $6.25bn. EBIT $583.8m vs consensus $460.5m. Interim dividend 48.5c/share, fully franked. Outlook: 2HFY21 results will be dictated by the shape of the pandemic curve in each region. Costs associated with operating in a COVID environment will continue but are gradually reducing through better management and where there is a lower prevalence of the virus. Surgical backlogs and latent demand for non-surgical services are expected to drive volumes as the public’s comfort with the hospital environment improves.
• Link Administration Holdings (LNK) +2.33% First-half operating profit $65.4m, in line with the preliminary announcement. Revenue $597.0m vs consensus $600.2m, in line with the preliminary announcement. Operating EBITDA $137.5m vs consensus $131.1m. Interim dividend 4.5c/share (60% franked). Outlook: Trading to date is in line with expectations, some headwinds remain in H2, core business continues to perform well. Expects FY21 to be a base, with earnings growth to resume in FY22. Challenging conditions remain in Europe. Global Transformation remains on track to deliver an increased $75m benefit by end of FY22. FY Guidance: Full year dividend expected to be 40-60% of profit. FY 2021 capex expected to be ~4% of revenue.
• Universal Store (UNI) +9.84% First-half underlying EBIT $31.5m vs guidance of $30-31m. Revenue $118m vs year-ago $95.7m. Like for like (LFL) sale growth +26.2%. Underlying profit $21.1m vs year-ago $12.9m. Interim dividend 5c/share, fully franked. Trading update and outlook: Sales for the first seven weeks of 2021 are +23.5% vs the same period last year. Like for like sales growth +28.2%. 2H FY21 will be cycling a period of COVID related store closures from April until mid-May. Has decided to repay the net 1H FY21 JobKeeper benefit received of $3.0m. This will be booked and repaid in 2H FY21. Due to the ongoing uncertainty relating to COVID the company is not providing guidance for FY21 at this time.
• Afterpay (APT) – First half profit -$79.2m vs year-ago -$31.6m. Total income $417.2m vs consensus $412.3m. EBITDA ex-items $47.9m vs consensus $37.1m. Net transaction loss 0.5% vs year-ago 0.5%. Underlying Sales $9.8bn +106%. ANZ Sales $4.8bn +53%. Active Customers 13.1m +80%. Active Merchants 74.7K +73%. To increase ownership of Afterpay US to 93% (from 80%), launches $1.25bn convertible notes offering with an option to upsize by $250m. Expected to be ‘strongly’ accretive.
• Stockland (SGP) –3.09% First-half funds from operations (FFO) 16.2c vs consensus 14c. Revenue $1.25bn vs year-ago $1.24bn. Profit $350m vs consensus $327.1m. Interim distribution 11.3cps. FY Guidance (Jun 2021): FFO 32.5-33.1c. Sees distribution at the lower end of target payout ratio of 75% to 85% of FFO.
• Zip Co. (Z1P) –7.67% First-half profit -$453.8m vs year-ago -$30.3m. Net adjustments relating to the acquisition of QuadPay $306.2m. Adjusted loss before tax $139.8m. Revenue $160.0m vs consensus $159.6m. Loan book (receivables) recorded $1.7bn, +42% vs year ago. Outlook: Has set the foundations to accelerate growth across the globe in FY21. Continues to look for new opportunities and strategic partnerships to expand the company’s footprint.

ECONOMIC NEWS

• Peter Costello of the ironically named ‘Future Fund’ has said that some asset prices are ‘unsustainable’.
• Australian new media laws have been passed.
• Total new capital expenditure rose by 3.0% in the December quarter vs estimates of -0.2%.

Estimates for average weekly ordinary time earnings for full-time adults (seasonally adjusted):

• Increased by 3.2% to $1,711.60 annually to November 2020.
• Males: $1,970.90 (public), and $1,770.30 (private).
• Females: $1,762.00 (public), and $1,475.50 (private).

CV19 NEWS

• Vaccine Tracker: 218m doses in 99 countries.6.14m a day. In US 66.5m doses 1.3m a day.
• Japan said it will begin vaccinating people age 65 and over with the Pfizer/BioNTech shot starting April 12.
• It’s a sneaky thing. A new variant of the virus, containing a mutation that may help it get past the immune system, is spreading in New York. About 4,000 cases of reinfection with Covid-19 have been found in South Africa.
• Czech Republic is preparing to impose a stricter lockdown to prevent the collapse of its medical system as existing measures fail to contain its fast spreading and highly contagious outbreak.

BOND MARKETS

ASIAN NEWS

• The Hong Kong decision to impose a trading tax may show the way forward for others to rebuild budgets. This kind of tax is one favoured by some Democrats in the US.

US AND EUROPEAN HEADLINES

• All eyes on GameStop again tonight as the stock goes wild again.
• UK Chancellor uses US as a example of plans to raise business rates.
• Texas power market crisis now under the microscope and subject of inquiries.
• First 3D printed house in US goes on sale for US$299,000.

And finally….

A teacher asked her students to use the word “beans” in a sentence. “My father grows beans,” said one girl. “My mother cooks beans,” said a boy. A third student spoke up, “We are all human beans.”

A lady comes home from her doctor’s appointment grinning from ear to ear. Her husband asks, “Why are you so happy?” The wife says, “The doctor told me that for a forty-five year old woman, I have the breasts of a eighteen year old.” “Oh yeah?” quipped her husband, “What did he say about your forty-five year old ass?” She said, “Your name never came up in the conversation.”

Please send fresh material…!!!

Clarence

XXX