ASX 200 (XJO) falls 0.3%, CBA (ASX:CBA) share price flat

The ASX 200 (ASX: XJO) is currently down around 0.3% as reporting season continues.

NSW continues to see a steady stream of new COVID-19 cases with another two cases from an unidentified source.

CBA (ASX: CBA) FY20 result

The bank said that its FY20 cash net profit after tax (NPAT) was $7.3 billion, down 11.3% on last year. The net profit was supported by strong business performance but impacted by higher loan impairment expenses.

Operating income was up 0.8% to $23.76 billion whilst operating expense rose 0.7% to $10.9 billion – which were partly offset by lower remediation costs.

CBA said that 135,000 home loans, being 8% of its total accounts, were being deferred at 31 July 2020. That figure is down from the peak of 154,000. There were 59,000 business loans that were being deferred at the end of July, being 15% of the total loans, down from 86,000 at the peak.

CBA reported that its statutory profit rose by 12.4% to $9.63 billion. This was due to gains on the sales of its divestments.

CBA announced a final dividend of $0.98 per share, bringing the full year dividend to $2.98 – down 31% on FY19.

The CBA share price is currently flat.

SEEK (ASX: SEK) FY20 report

SEEK said that its financial results have been impacted by weak economic conditions and COVID-19.

Revenue grew 2.6% during the year to $1.58 billion. It was impacted by a weak economy and COVID-19 in the second half of FY20.

Reported EBITDA (click here to learn what EBITDA means) fell by 9% to $414.9 million. Excluding ‘significant items’, reported net profit after tax (NPAT) more than halved to $90.3 million. Including significant items, it reported a net loss of $111.7 million.

In FY20 SEEK recognised an impairment charge of $198 million relating to Brasil Online, OCC Mundial and four non-core minority investments.

SEEK ANZ saw revenue decline by 12% and EBITDA dropped 15%. It remains the market leader with a third of placements and it has around five times more than its nearest competitors. SEEK Asia reported a revenue decline of 14% and EBITDA dropped 26%.

SEEK CEO and Co-Founder Andrew Basset said: “Over the long-term, our strategy and overall revenue opportunity remain intact albeit COVID-19 will likely impact the timeframe to achieve our $5 billion revenue aspirations. We are confident in our strategy and growth prospects…

When labour markets return to more normal conditions, we expect to generate a high ROI given our market leadership and track record of generating strong returns from investing in product, technology and data.”

The SEEK share price is down 9.6%.

Magellan (ASX: MFG) FY20 result

Magellan revealed that its average funds under management (FUM) increased by 26% to $95.5 billion. The size of a fund manager’s FUM is a very important part of generating profit from management fees.

Net profit after tax rose by 5% to $396.2 million. Adjusted net profit after tax rose by 20% to $438.3 million – this measure excludes items like amortisation, unrealised gains/losses on ‘principal investments’ and transaction costs relating to strategic initiatives.

The Magellan board declared a final dividend of $1.22 which was up 10%. Total dividends were up 16% to $2.149 per share.

Magellan is going to launch two new products: the ‘MFG Core Series’ and the ‘Magellan Sustainable Fund’.

The core series is going to be a group of investment strategies, initially being the MFG Core International Fund, the MFG Core ESG Fund and the MFG Core Infrastructure Fund.

They will be actively constructed diversified portfolios but come at a management fee cost of 0.5% per year, which is much cheaper than Magellan’s other products.

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At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.

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