The ASX 200 (ASX: XJO) is up 0.3% after Treasurer Josh Frydenberg revealed the economic picture of Australia’s budget.
The federal budget in 2020 ended with a deficit of around $86 billion. The FY21 deficit is expected to be over $184 billion. The unemployment rate is expected to go above 9% by December 2020.
Net debt was $488 billion at the end of June, it’s expected to grow $677 billion. Equivalent to 36% of GDP.
However, some of the assumptions include a (slow) return of international visitors early next year and no further restrictions or outbreaks.
Coca Cola Amatil (ASX: CCL) shares rise 5%
Coca Cola Amatil said that it has experienced an improvement in trading conditions in its major markets in June after an easing of COVID-19 restrictions.
Trading volumes were down 9% in the month of June 2020 compared to June 2019. The June 2020 quarter showed a volume decline of 23% compared to the June 2019 quarter.
The volume performance varied across different countries. In New Zealand, June 2020 volumes were up 4%. Australian volumes were down 3%. Indonesian volumes were down 23% in June 2020, though this is still better than May and April.
Coca Cola Amatil’s profit margins, particularly in Australia, due to changing consumer preferences. The grocery channel is a lower margin channel compared to on-the-go.
After reviewing its balance sheet items and COVID-19 impacts, Coca Cola Amatil said it expects to recognise an impairment charge of between $160 million to $190 million. This mostly relates to the Indonesian business.
Dicker Data (ASX: DDR) share price up 7%
Dicker Data said that in its HY20, total revenue (from ordinary activities) rose 18.1% to just over $1 billion. Recurring software revenue grew 53.1% to $225 million for the FY20 half year.
Net profit before tax went up 30.4% to $42 million and net profit after tax grew 23.5% to $29.4 million.
The company said due to recent surge in remote work, Dicker Data has seen a surge in demand for remote and virtual working solutions for both hardware and software. Management said this showed IT’s essential role in enabling business continuity.
New vendors added during FY19 and FY20 accounted for incremental revenue of $28.3 million in HY20. Existing vendors (added in FY18 and prior) grew revenue by 15.1% as existing vendor relationships were leveraged to gain access to new product lines or increased market share.