Investment Research Updates

Company Updates: HLS, ASX, PME, ORG, DOW, TAH, CNI, AGL, GOZ

06/06/2022

Healius Limited (HLS) provided a trading update on Friday that revealed trading conditions had been challenging in the second half of FY22. HLS is expecting YTD ending May 2022 underlying EBIT of $473 million. While this is a 100% increase on the pcp, this means that HLS earned approximately $100 million of EBIT over the past five months, compared to $376 million in the first half of FY22. HLS’s pathology and imaging businesses tracked slightly ahead of Medicare data in Q3, however staff on sick leave and surgery cancellations have remained headwinds. HLS’s shares finished 8.65% lower at $3.80.

03/06/2022

ASX Ltd (ASX) revealed yesterday it had appointed Helen Lofthouse as the company’s Managing Director and CEO. Lofthouse was appointed internally after a four-month search and will commence on 1 August. Outgoing CEO Dominic Stevens announced his retirement in February and will hold the position until 31 July. Lofthouse has been serving as the Group Executive, Markets since July and has been with ASX since 2015. ASX’s shares finished the day 0.96% lower at $80.65.

Pro Medicus Limited (PME) announced yesterday it had signed a 7-year, $28 million contract with Allina Health. Under the contract, PME’s Visage imaging platform will replace the legacy system used throughout the Allina Health network. Planning to integrate the platform will commence immediately, with the go-live date targeted towards the second half of this year. PME’s shares finished the day 0.36% lower at $41.14.

02/06/2022

Origin Energy Limited (ORG) revealed yesterday it had reduced its FY22 EBITDA guidance for its Energy division by 26%, while withdrawing group guidance for FY23 completely. The downgrade comes largely as a result of its Eraring Power Station being unable to source sufficient coal from its suppliers, resulting in lower output from the plant. ORG noted this has been an ongoing problem over the past 12 months but is expected to continue into the first half of FY23. ORG’s LNG business has stood to benefit from rising commodity prices, but not enough offset the underperforming Energy division. ORG’s shares finished the day 13.72% lower at $5.91.

Downer EDI Limited (DOW) announced yesterday it had been awarded a $100 million contract to deliver transmission services to New Zealand’s electricity grid. The contract will involve DOW being responsible for grid maintenance, station operating services and other services across the North Island. The contract is set to begin in August 2022 for an initial five-year term, with the possibility to extend an additional five years. DOW’s shares finished the day 0.35% higher at $5.75 per share.

01/06/2022

Tabcorp Holdings Limited (TAH) confirmed leadership changes on the back of the demerger that spun off the lotteries and Keno business into The Lottery Corporation (TLC). TAH Chairman and Non-Executive Director Steven Gregg will retire from today (Wednesday) and will assume the same positions within the newly demerged TLC business. David Attenborough will retire as TAH’s Managing Director and Chief Executive Officer and will be replaced by Adam Rytenskild. TAH’s shares finished Tuesday 2.38% lower at $0.94, while TLC’s shares finished 0.42% higher at $4.80.

Centuria Capital Group (CNI) revealed on Tuesday that it had secured two additional assets totaling $223 million. $163 million will be allocated towards a private hospital development in Alexandria NSW, with 43% of the development pre-leased on a 15-year term. This deal will increase Centuria’s CCP joint venture to four assets and is expected to be worth $372 million on completion. CNI also secured a 7,037sqm neighborhood shopping centre in Cameron Park NSW for $60.25 million. CNI’s shares finished the day 1.34% lower at $2.21.

31/05/2022

AGL Energy Limited (AGL) revealed on Monday it had withdrawn the proposal to separate the business into two separate companies. The company advised that it would likely have insufficient shareholder support to approve the transaction. Subsequently, AGL will commence another strategic review of operations as an alternative to the demerger. Yesterday’s announcement also revealed that AGL’s chief executive Graeme Hunt and chairman Peter Botten will both be leaving the company. AGL’s shares finished Monday 1.35% lower at $8.72.

Growthpoint Properties Australia Ltd (GOZ) announced yesterday it had expanded its office portfolio by purchasing an A-grade office complex in Dandenong for $165 million. 96.8% of the complex is leased to the Victorian State Government, with the remainder leased to eight ground floor retail businesses. The weighted average lease expiry (WALE) is 9.5 years. The transaction will be funded through debt and is expected to be accretive to FY23 funds from operations (FFO). Shares finished the day 1.8% higher at $3.93.

 

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