Aust shares edge lower on big day for earnings reports

Derek Rose | February 20, 2024

The local share market is slightly lower at midday after a big step forward for a major banking deal and a spate of earning reports, including one from Australia’s biggest company.

At noon AEDT on Tuesday, the benchmark S&P/ASX200 index was down 8.4 points, or 0.11 per cent, to 7,655.7, while the broader All Ordinaries was 6.4 points, or 0.08 per cent, lower at 7,906.9. 

Suncorp was up 5.4 per cent to $15.21 and ANZ was down 3.0 per cent to $27.645 after the Australian Competition Tribunal authorised ANZ’s proposed $4.9 billion acquisition of Suncorp Bank.

“This is a significant milestone and an important step forward in the process, however we still have further conditions to meet,” said ANZ chief executive Shayne Elliot, explaining that the transaction requires action from Queensland Parliament as well as approval from Federal Treasurer Jim Chalmers.

The other big banks were mostly higher, with Westpac up 2.4 per cent and NAB gaining 0.5 per cent while CBA had dipped 0.4 per cent. Also, Bendigo and Adelaide, sometimes mentioned as another possible acquirer of Suncorp Bank, had gained 1.9 per cent to $9.90.

In the materials sector, BHP was down 0.2 per cent to $45.96 after the Big Australian slashed its dividend after its loss-making nickel operations took the shine off its iron ore and copper mining.

RBC Capital Markets analyst Kaan Peker said the first-half earnings report contained no real surprises with most key metrics in line with estimates.

Rio Tinto was down 1.0 per cent and Fortescue had dipped 0.1 per cent ahead of their earnings reports on Wednesday and Thursday.

Elsewhere in the sector, Sims had dropped 8.7 per cent to a three-month low of $13.26 after the metals recycler announced its first-half earnings were down 86 per cent to $13.4 million. 

The Star Entertainment Group had plunged 20.1 per cent to an all-time low of 44.75c after its shares resumed trading following Monday’s announcement that the NSW regulator would hold another inquiry into its suitability to hold a casino licence.

“The Star appreciates the opportunity to demonstrate it has the ability to regain suitability and will continue to do all in its power to work cooperatively with all its regulators,” the company said.

Bravura Solution had soared 28.1 per cent to a 17-month high of $1.23 after the financial services software company announced it had returned to profitability in the first half and was net debt-free as of December 31.

 E&P Financial analyst Olivier Coulon called it a much better operational result than expected that had materially upgraded 2023/24 expectations.

 McMillan Shakespeare was up 14.9 per cent to a six-month high of $20.05 after the novated leasing and salary packaging company announced its first-half earnings were up 42.9 per cent to $86.9 million.

Chief executive Robert De Luca described it as a strong performance that had been supported by the federal government’s fringe benefit tax exemption for electric vehicles. 

Sonic Healthcare was down 7.3 per cent to $29.39 after the global pathology chain reported a 47 per cent drop in net profit, to $202 million. 

“Whilst our headline numbers for the half-year show significantly lower earnings versus the comparative period, this is the result of having 90 per cent less COVID-related revenue in the current period,” chief executive Dr Colin Goldschmidt said. 

Humm Group was down 21.2 per cent to a one-month low of 547.5c after the buy now, pay later company posted a statutory $6 million first-half loss, compared to a $7.5 million profit a year ago.

The Australian dollar was buying 65.31 US cents, from 65.41 US cents at Monday’s ASX close.