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Reporting season 2022: NAB grows, AMP shows greenshoots

Posted: 10 February 2022 10:47 am
News
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Reporting season is underway with investors gaining a snapshot to how businesses are actually performing.

After a handful of bigger names, reporting season is turning up a notch, as the banks continue to face margin pressures, while an Australian institution begins a rebranding.

Here is what you need to know about the market today:

National Australia Bank

Another day, another bank pointing to increasing competition and lowering net interest margins.

Following announcements over the last week from both Westpac and Commonwealth Bank, it comes as little surprise to investors that NAB is also seeing its margins reduce.

While the 5 basis points is a concern longer term, the bank overall shows strong growth in a post COVID-19 lockdown era.

But, in positive news NAB's CEO Ross McEwan reveals a strong lift in growth.

NAB posted a 12% lift for the December quarter to $1.8 billion.

The strong numbers come off the back of a 2.6% expansion in mortgage portfolios and a 3.4% increase in business loans.

While highlighting the challenges of Omicron, the CEO goes on to discuss how the bank has remained displacing in executing its strategy.

"These results reflect an ongoing focus on executing our strategy, making the bank simpler for customers and colleagues. This is evident in our improving customer net promoter scores in consumer and business over 1Q22, which are pleasingly no longer negative. There is more work to do but we are moving in the right direction," the CEO said.

NAB is up 3.5 per cent to $29.38 on the opening bell.

AMP

Wealth giant AMP has had a tough reporting season, informing investors that the company lost $252 million in FY2021, while revenue slid 3%.

However, AMP's net profits are on the rise, increasing by 38% to $153 million off the back of assets under management growing to $134 billion.

"We have set a clear strategy to drive two simpler and more efficient businesses, well placed to compete, grow and deliver value in a highly dynamic market," chief executive Alexis George said.

"We've achieved a solid underlying profit result, which shows the strength of our Bank, growth of the North platform with increased inflows from external financial advisers, and the significant cost savings achieved from across the business, in line with our targets.

AMP was trading 4 per cent higher at $1.05.

AGL

Retail electricity and gas provider AGL saw steady increases during its reporting.

The company highlights revenues are up 5.5% over the half year to $5.713 billion, while underlying earnings per share fell 42.4%.

Investors in the company will now receive a 16 cent interim dividend which is down from the prior one which was 41 cents.

CEO Graeme Hunt notes lower earnings were primarily attributable to the non-recurrence of 105 million dollars of insurance proceeds received in the first half of last year, relating to the 2019 Loy Yang outage. They were also impacted by progressive roll-off of hedge positions and expiring legacy gas supply contracts.

"Looking forward, AGL is well placed to benefit from the improvement in wholesale electricity prices we've seen over the last six months. And we expect this, together with any sustained improvement to wholesale pricing, to be reflected in future earnings beyond FY22, as hedge positions roll off," the CEO said.

AGL was up 1.86% to $7.67 following its results.

Mirvac

Australian property group Mirvac also informed the market of its financials today.

It' their own words the company announced 'solid results' with statutory profits up 44% to $565m and operating profits up 9% to $297m.

This gives the company an operating earnings before interest and tax of $391 million, up 8% on this time last year.

Mirvac's CEO & managing director, Susan Lloyd-Hurwitz, said, today's results reflect careful navigation through a global pandemic.

"As we expected, the extended lockdowns in the first half of the financial year impacted the performance of our Integrated Investment Portfolio, concentrated in Retail. However, this was offset by a strong performance in our development businesses," she said.

The CEO also points to a stronger future from both a business and environmental standpoint.

"We also made significant strides in our commitment to having a positive impact on the planet during the reporting period, becoming the first Australian property group to be net positive carbon for our scope 1 and 2 emissions, nine years ahead of our 2030 target, Lloyd-Hurwitz continues.

Shares were slightly down at $2.60 following the update.

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