ASX 200 (XJO) down 1%, Altium (ALU) rises

The ASX 200 (ASX: XJO) is down around 0.9% as reporting season continues.

Altium Limited (ASX: ALU)

Altium revealed that FY20 revenue rose by 10% to US$189.1 million and reported expenses only increased by 8% to US$113.5 million.

Its subscription base rose by 17% to 51,006 subscribers. Altium Designer seats sold rose by 15% to 9,251. The release of Altium 365 – its cloud offering – helped growth this year.

The revenue growth led to EBITDA (click here to learn what EBITDA means) rising by 13% to US$75.6 million. The reported EBITDA margin improved by 1.1% (110 basis points) to 40%. However, the underlying EBITDA margin fell by 0.8% (80 basis points) to 35.8%.

Profit before income tax increased by 12% to US$64.6 million. Profit after tax fell 42% to US$30.9 million and reported profit/earnings per share (EPS) also dropped 42% to 23.6 cents.

However, the normalised EPS rose by 5% to 42.45 cents. Altium explained that FY20 included a one-time accounting charge of US$16.4 million for the deferred tax asset revaluation based on US tax optimisation which will decrease the effective tax rate in FY21 to between 22% to 25% (down from the previously stated 27% to 29%).

Altium’s board decided to declare a final dividend of AU19 cents per share, up 6% compared to last year. That brought the full year dividend to AU39 cents, up 15%.

Management also said that its US$500 million revenue goal may take an extra six to 12 months to achieve. However, Altium management said the company is on track to achieve its goal of 100,000 subscribers by 2025.

The Altium share price is up 3.5%.

JB Hi-Fi Limited (ASX: JBH)

JB Hi-Fi revealed that in FY20 its total sales increased by 11.6% to $7.9 billion.

JB Hi-Fi Australia sales grew by 12.5% to $5.32 billion. Communications, computers, visual, audio and small appliances were the categories that saw elevated growth. Online sales increased by 56.6% to $404 million. Its profit margins improved during the period.

JB Hi-Fi New Zealand sales fell 5.7% to NZ$222.8 million due to store closures because of COVID-19 restrictions. The Good Guys sales grew by 11.2% to $2.39 billion.

‘Underlying’ EBIT (click here to learn what EBIT means) increased by 30.5% to $486.5 million and underlying net profit after tax (NPAT) rose by 33.2% to $332.7 million. Statutory/reported NPAT increased by 21% to $302.3 million.

You may be wondering what the difference between underlying and reported earnings is. The statutory figure includes the new AASB 16 Leases accounting standard and also includes a $24 million write-off of certain JB Hi-Fi New Zealand assets.

JB Hi-Fi’s Board decided to declare a final dividend of 90 cents per share, up 76.5%. That brought the final dividend to $1.89, up 33.1%.

The JB Hi-Fi share price is up 3.3%.

Bendigo and Adelaide Bank Ltd (ASX: BEN)

Bendigo Bank announced that its cash earnings after tax was down 27.4% to $301.7 million and its statutory profit after tax was down 48.8% to $192.8 million.

Part of the profit decline was down to a reduction of its net interest margin (NIM) down 3 basis points to 2.33%. The NIM is important because it shows what profit (in percentage terms) it makes from the money it lends out compared to the cost of those funds (eg deposits).

A big reason for the profit decline was COVID-19 provisions. Bendigo Bank reported bad and doubtful debts of $168.5 million with a COVID-19 collective provision of $127.7 million.

However, Bendigo Bank remains in a strong financial position with a CET1 capital ratio of 9.25%, up 0.33% (33 basis points).

The Bendigo Bank share price is down 6.2%.

Kogan.com Ltd (ASX: KGN)

The company announced that its FY20 gross sales increased by 39.3% to $768.9 million with revenue growth of 13.5% to $497.9 million. This helped gross profit grow by 39.6% to $126.5 million. The gross margin increased by 4.7% (470 basis points) to 25.4% showing the increasing profitability of the online business.

Its active customer base grew by 35.7% to 2,183,000 people as customers looked to buy goods online during this difficult COVID-19 year.

Adjusted EBITDA (click here to learn what EBITDA means) increased by 57.6% to $49.7 million and net profit after tax (NPAT) rose by 55.9% to $26.8 million.

It was the COVID-19-affected second half that delivered accelerated growth. FY20 second half gross sales rose 62.5%, gross profit went up 68.3% and adjusted EBITDA rose by 74.1%.

At 30 June 2020 the company had cash of $146.7 million with an undrawn bank facility of $30 million. This doesn’t include the $20 million share purchase plan which was completed in July 2020.

The financial strength allowed Kogan.com’s board to implement a large final dividend. Kogan.com’s dividend was increased by 64.6% to 13.5 cents.

As the company has already announced, in July 2020 gross sales were up more than 110%, gross profit was up over 160% and adjusted EBITDA was more than $10 million.

The Kogan.com share price is down 4%.

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At the time of publishing, Jaz owns shares of Altium.

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