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ASX 200 rises, Challenger and James Hardie up on results

The ASX 200 had a positive day as Challenger and James Hardie reported.
The post ASX 200 rises, Challenger and James Hardie up on results appeared first on The Motley Fool Australia. –

The S&P/ASX 200 Index (ASX: XJO) went up by 0.3% to 7,563 points.

Here are some of the highlights from the ASX today:

James Hardie Industries plc (ASX: JHX)

The James Hardie share price went up 3% today after releasing its result for the first quarter of FY22.

In the first three months of the financial year, to 30 June 2021, it saw total net sales increase by 35% to US$843.3 million. Net profit surged 1,191% higher to US$121.4 million. Global adjusted earnings before interest and tax (EBIT) increased 45% to US$180.5 million with the adjusted EBIT margin rising 150 basis points to 21.4%.

The North American and Asia Pacific divisions were what drove the EBIT higher. The North America division saw adjusted EBIT grow 29% to US$169.3 million and Asia Pacific adjusted EBIT rose 50% to A$50.4 million.

James Hardie CEO Dr Jack Truong said:

I am very pleased that this first quarter marked our ninth consecutive quarter of delivering growth above market and strong returns. In our investor day at the end of May, we described our three critical initiatives for FY22 through to FY24: One, market directly to homeowners to accelerate demand creation, two, penetrate and drive profitable growth in existing and new segments and, three, commercialise global innovations by expanding into new categories. Further, we discussed our focus on driving a high value product mix in all three regions.

The company raised its guidance for FY22. It’s now expecting adjusted net income to be between US$550 million to US$590 million, up from the previous guidance of US$520 million to US$570 million. That compares to FY21 adjusted net income of US$458 million.

The James Hardie share price was one of the better performers in the ASX 200.

Challenger Ltd (ASX: CGF)

The Challenger share price went up more than 1% after the annuity business released its FY21 result.

It said that group assets under management (AUM) grew by 29% to $110 billion, with life book growth of 14% and funds management net flows of $16 billion.

The company said that its profit was within its guidance range. Normalised net profit before tax was $396 million, down 22%, reflecting a proactive decision to maintain more defensive portfolio settings during the pandemic.

It generated a statutory net profit after tax of $592 million, which included positive investment gains.

Challenger said that it has a strong capital position, with Challenger Life having $1.6 billion of excess regulatory capital.

The full year dividend was increased by 14% to 20 cents per share.

Challenger managing director and CEO Richard Howes, said:

This year, we have taken decision action to set up the business for future growth – executing our strategy to diversify revenue, repositioning our investment portfolio and strengthening our balance sheet.

Following our decision to reposition the investment portfolio during the early stages of the pandemic, as flagged, we gradually deployed significant cash balances into higher returning assets throughout the year, with the full benefits to be realised next year.

Mr Howes also announced his intention to retire, set for March 2022. 

Megaport Ltd (ASX: MP1)

Megaport was another ASX 200 share to report its result to investors today. The Megaport share price increased by 3%.

It said that annual revenue increased by 35% to $78.28 million, whilst customers went up 24% to 2,285.

Monthly recurring revenue (MRR) for the month of June 2021 was $7.5 million, an increase of 32% year on year.

Megaport said that it generated a profit after direct network costs during the year of $42.1 million, an increase of 43% year on year. It achieved breakeven earnings before interest, tax, depreciation and amortisation (EBITDA) in June 2021.

The Asia Pacific region saw a profit after direct network costs margin of 73%.

However, the bottom line for the year was a net loss of $55 million. It finished with a cash position of $136.3 million.

It’s planning to continue to invest for growth of its market share, invest in its product and service, and invest in its people.

The ASX 200 company also announced the acquisition of InnovoEdge for up to US$15 million, including US$7.5 million of cash. It was described as an AI-powered, multicloud and edge application orchestration company. 

The post ASX 200 rises, Challenger and James Hardie up on results appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended MEGAPORT FPO. The Motley Fool Australia owns shares of and has recommended Challenger Limited. The Motley Fool Australia has recommended MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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