Reporting season 2022: Qantas’ losses deepen, Fintech takes off

Posted: 24 February 2022 10:47 am
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Reporting season is underway with investors gaining a snapshot of how businesses are actually performing.

Another day of reporting season saw the impact of closed borders on the national carrier, how an entertainment giant grew due to lockdowns and how COVID impacted a health supplement company.

Here's what you need to know.

Qantas

Unsurprisingly, a half year result marred by lockdowns and an outbreak of the Omicron strain has put pressure on Qantas' bottom line, with the company reporting an underlying pre-tax loss of $1.3 billion in the 6 months to 31 December. The company points out it has been flying at 18% capacity of pre-COVID levels.

In fact, Qantas' losses are growing down a further 20% from the corresponding period in 2020.

And things are looking like they could get worse with the latest strain predicted to take another $650 million off the company's earnings.

Despite Qantas' CEO Alan Joyce being "frustrated" by the last 6 months, the airline is highlighting a bright future.

The company says it's onto its third stage of the recovery plan which involves being ready to fly when demand returns, as well as continuing to repair the balance sheet.

By June this year it is now expected that 95% of all staff will be returning to work as demand for its services quickly returns.

In a sign of the post-Delta recovery, the Group recorded 3 consecutive months of positive net free cash flow between October and December (excluding the land sale), largely as a result of the recovery in forward bookings.

Qantas Group CEO Alan Joyce told the ASX that with most of the country in lockdown, today's result isn't surprising but it is frustrating.

"Despite all the uncertainty, we finished the first half with net debt back inside our target range and with strong liquidity, meaning we can start to look further ahead at strategic decisions on fleet, network and growth opportunities," he said.

"We're on track to deliver more than $900 million in annualised savings through restructuring by the end of FY22, which is ahead of schedule and means we're able to recover faster and perform better than pre-COVID," he said.

Shares in Qantas fell 1.96% to $5.24.

Nine Entertainment

On the other side of the pandemic is Nine Entertainment which received a major boost following stay at home orders.

The company, which owns channel 9, Fairfax media and Stan, saw strong audience results leading to a record year in total TV advertising.

The company also highlights a 50% plus growth in streams and revenue at 9Now driven by live and better than expected results from Stan.

Overall statutory net profits to the 6 months to 31 December grew 18% to $213.2 million.

Investors where buoyed by today's results with shares up 4.06% to $2.82.

Blackmores

Australian health supplements company Blackmores highlights it has passed key milestones on its investments in targeted growth markets and segments, while focusing on cost management.

The company, which has had mixed fortunes through the pandemic, saw its revenue grow 14.3% to $346 million. Its underlying net profits after tax are also up 9.6% to $20.8 million.

However, most of the growth is an overseas story. In Australia revenue is down 1.2%, while in the lucrative China market revenue grew 8.5%, with the international segment as a whole up 49.8%.

The company said "looking ahead to the second half of FY22, in Australia, we expect the category to continue to recover, albeit slowly, and we will remain focused on executing against key consumption periods, reduce out of stocks, and accelerating our delivery of new product innovation".

Shares in Blackmores are down 1.74% to $91.08.

Raiz

Aussie micro investing app Raiz has seen another strong half-year result with funds under management passing the $1 billion mark.

The company highlights that revenue is up 85% to $8.7 million, while global active customers grew by 73% to 594,992.

However, the company is still loss making with losses after income tax of $2.9 million.

Raiz Invest CEO George Lucas said: "We are very pleased with our sustained strong growth throughout 1H 22 despite the lingering impacts of the COVID-19 pandemic."

"Throughout the first half of this financial year, we have remained focused on boosting our performance across all of our key metrics in Australia, and customer growth in Indonesia and Malaysia. We have achieved record results in the process.

Shares in Raiz rose 7.08% to $1.28 following the announcement.

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