AWB

AWB

Tue, 24/06/2008 - 05:58

Stock Code

AWB

Stock Exchange

Australian Securities Exchange

AWB Limited (AWB) is an Australia-based company engaged in providing insurance, commodity risk and finance management services in the regional and rural areas of Australia. It is one of the top 100 publicly listed companies in Australia. AWB was listed on the Australian Stock Exchange on the 22nd of August 2001. Its average annual revenue reaches approximately AUD$502 million. Its headquarters is located in Melbourne, Australia and to date; around 2,200 people are employed in the company.

AWB Forecasts Loss for the Year


The Australia based agribusiness group AWB today announced that the company is expecting to post a loss for the year and willing to raise as much as $459 million at a huge discount in order to refinance a debt facility. According to AWB authority, the fund will be raised through fresh shares for $1 per share, which is offering a 31 percent discount to Tuesday’s closing price ($1.45).

AWB Announces Strong Half Yearly Results


AWB posted strong half- yearly results yesterday. It remains solid for two years despite facing consecutive drought years. The net profit after tax for the half year was $48.7 million which showed 96 percent increase from the corresponding year. EBITDA for past six months was up 53 percent to $110.7 million. The bottom line had provision of $26.4 million as a probable liability that may arise due to litigation by Standard Chartered Bank to AWB (USA). Standard Chartered has a long due dispute with AWB (USA) over a commercial promissory note. AWB kept its interim dividend of four cents.

Pan Australian Resources (PNA): Winner


Pan Australian Resources (PNA) was the overall best performing stock taking in a 13.09 percent increase. Among the best performing companies for the week 42 of 2007 on the Australian sharemarket were a mixture of energy, metal & mining, drilling services and agribusiness: Paladin Energy (PDN), Newcrest (NCM), Boart Longyear (BLY), Pan Australian Resources (PNA), AWB (AWB), Mt. Gibson Iron (MGX). All the above best performing stocks for week 42 managed more than 5 percent gain by the end of the trading week. The week’s highlight was the majority of metal and mining companies.

Best Performing Stocks Week 42


Among the best performing stocks last week (week 42) on the Australian sharemarket were a mixture of energy and mining companies: Nexus Energy (NXS), Paladin (PDN), Pan Australian Resources (PNA), AWB, Mt Gibson Iron (MGX), Sino Gold (SGX), Roc Oil (ROC) and Flight Centre (FLT). All the above best performing stocks for week 42 stocks managed more than 10 percent gain on the trading week. Nexus Energy was the overall winning stock taking in a 16 percent increase after new company takeover speculation and the recent increase in the oil price.

Losers of the Week for ASX100 and ASX200


On the ASX100 index, Allco Finance (AFG) was the worst performing stock meanwhile on the ASX200 index, AWB (AWB) was the worst performing company listed. Allco Finance and AWB are the losers of the week for week 36 of 2007. Allco Finance lost 6.243 percent (-$0.55, closing $8.26) and AWB lost 12.458 percent (-$0.37, closing $2.60) after after admitting the drought will cause a big drop in this year's wheat harvest. AFG was previously a loser and a winner. AWB has also previously been a loser and a winner. The AUD/USD pair closed the week at 82.67 cents, gold at $700, the All Ordinaries at 6296.5 and the ASX200 index on 6278.

AWB Update


AWB shares have had a volatile week, plummeting 11% in the first two days, and then clawing back 2% yesterday. Weighing on the sentiment was the company’s first half net profit numbers and the decision to strip the company of control of the single desk wheat export after next crop. AWB will clearly remain a volatile stock until the final industry structure is realised. As expected, the result was impacted by drought conditions and the small FY07 crop. NPAT was $11.8m, adjusted $24.9m and interim dividend of 4cps. Underlying profit of $24.9m was down 59% on pcp of $60.3m. An underlying tax rate of 19% was lower than MRE’s 25% expectation. Total overheads across the group were reduced by $25.9m (230 FTEs), ahead of stockmarket analyst, Macquarie Research Equities expectations. The new dividend reflects both the drought and the future of wheat marketing arrangements. The analysts have lowered their annual dividend forecasts to 8cps. Guidance previously given at the AGM for FY07 of an underlying profit of $67m was not updated. Achievement of this forecast will require further follow up rains from recent seasonal break. New wheat marketing arrangements: The Prime Minister has announced that a new grower owned wheat marketer (most likely a de-merged AWBI) will be formed by March 2008 and that the current wheat marketing system will remain in place for the December 2007 crop. If the new entity is not finalised by March 2008, the industry will be deregulated further. The impact of this on AWB depends on whether the AWBI demerger includes the pool management division. If it doesn't, our price target is $3.33 and if it does, our price target falls to $2.58. If the demerger misses the March 2008 deadline, deregulation becomes a possibility. This would reduce the analysts' price target to $1.85 per share. There is still significant uncertainty as to the eventual outcome. Earnings revision FY07 EPS up 7.3% to 15.5cps, mainly due to lower tax rate assumptions. FY08 EPS up 1.1% to 30.5cps. The analysts' long term valuation based on a normal season is $3.33 and assumes AWBI separation only. If the pool management division is separated from AWB as well our price target falls to $2.58. AWB will clearly remain a volatile stock until the final industry structure is realised.

AWB: Winner


AWB (AWB) is the winner of the week (the best performing company on the Australian sharemarket ASX200 index) for week 1 of 2007. The Australian Wheat Board company closed the week 27 cents higher or 8.85 percent, closing at a final price of $3.32. The ASX All Ordinaries closed lower by 1.7 percent from 5644.3 to 5544.8.

AWB: Best Performing Company of the Week


AWB was the best performing company this week on the Australian Stock Exchange (ASX) (Winner of the Week for week 51 of 2006). The company closed higher by 22 percent closing the week at $3.08.

AWB: Worst Performing Company


AWB was the worst performing company listed in the Australian Stock Exchange (ASX) this week (Loser of the week for week 49 of 2006). The AWB share price closed 8 percent lower this week after the Australian Federal government removed its wheat export monopoly. AWB has been in the news lately largely due to the scandal related to the kickbacks and the oil for food program. The changes to legislation are contained in the Wheat Marketing Amendment Bill 2006.

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