Why the CleanSpace (ASX:CSX) share price is tumbling 8% today

The CleanSpace (ASX: CSX) share price is tumbling 8% lower after the respirator maker announced half-year results this morning.
The post Why the CleanSpace (ASX:CSX) share price is tumbling 8% today appeared first on The Motley Fool Australia. –

piggy bank wearing mask

The Cleanspace Holdings Ltd (ASX: CSX) share price is falling today, as the respirator company gives forewarning to the end of the COVID-19 tailwind.

The company released its half-year results for the period ending 31 December 2020 this morning. At the time of writing, the CleanSpace share price is trading hands at $6.79 a share, down 8.82%.

Results boosted by COVID-19 demand

There are not too many industries that directly benefitted from the situation fostered by COVID-19. However, respirators would certainly be one of them. Given the respiratory nature of the virus, masks and respirators have been used widely to combat the spread. In the healthcare space, it has been essential in abating the risk to frontline workers.

Hence, it comes as no surprise that CleanSpace’s revenue increased by more than fivefold compared to 1H FY20. The top-line result of $39.7 million was comprised of 50% US sales, 17% EMEA sales, and 33% Asia Pacific sales. The healthcare industry really outshone the industrials segment during the half, with 78% of total revenue.

The high proportion of healthcare sales combined with high accessory sales aided in lifting the company’s gross margin to 78%. Consequently, CleanSpace’s net profit after tax nearly doubled to $13.7 million for the half.

Wary of a drop-off

Although the company outlines the possibility of a prolonged way of living with the virus, there is also looming uncertainty. As stated in the CleanSpace presentation, “There are clear signs the pandemic has shifted to a closing phase, and it is expected that 2H will be lower than 1H.”

The company currently has 2 operational manufacturing facilities between St Leonards and Artarmon in New South Wales. Clearspace detailed its intentions to consolidate to one location to capture increased efficiencies as the virus risks taper off.

CleanSpace share price recap

CleanSpace listed on the ASX last year on 22 October. Since then, the share price has been floundering around between $5.60 and $7.50 per share. Despite the tailwind of COVID-19, the CleanSpace share price is down 8.5% since its listing.

The company currently trades on a 41.4 times price-to-earnings (P/E) ratio. This is based on its current market capitalisation of $568 million.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has recommended CleanSpace Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the CleanSpace (ASX:CSX) share price is tumbling 8% today appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!