Inflation Fears are Back

August 24, 2022

Good Morning,

Gaurav Sharma has been expelled from Labour's caucus, Citi warns of 18.8% inflation in the UK, Altium soared after great earnings, Musks subpoenas Jack Dorsey, Ford is cutting jobs, Morrison's secret ministries "fundamentally undermined" responsible government and Manchester United pulled off a shock victory over Liverpool.

Let's jump in.

Before The Bell

Markets

  • The NZ and Australian markets fell in line with global markets due to pesky inflation fears returning. Subpar earnings also hampered the ASX.

  • The NASDAQ had its worst performance since June 28th.

  • Bond yields gained ground whilst gold prices fell to their lowest levels in nearly 4 weeks.

Earnings

  • NZME reported a 37% increase in net profit after tax of $8.5m (NZD) and stated they would recommence a stalled share buyback from today. (NBR)

  • Endeavour Group fell sharply, down 12.3%, due to the reporting of increased costs and flat margins. (AFR)

  • Altium soared up 19.75% after reporting a 57% increase in net profit and increasing its dividend. (AFR)

  • Ansell rose 8.5% because investors believed they could still make solid profits in a more normal environment. This was despite a 36% drop in profit due to a reduction in demand for PPE. (AFR)

  • Summerset reported a record underlying profit of $82.5m (NZD), up 9.2% on the previous first half, as well as the purchase of three new sites. (NBR)

  • There are still lots of earnings to come this week, including Air New Zealand, Coles, David Jones, Ebos, Qantas, Spark, Wesfarmers, and Woolworth.

News Summary

  • Gaurav Sharma has been expelled from the Labour Party caucus (Stuff)

  • Air New Zealand's first plane has arrived back from the desert boneyard (Stuff)

  • Trevor Mallard officially retires as Speaker (Stuff)

  • Scott Morrison's secret ministries "fundamentally undermined" responsible government (AFR)

  • Citi warns of 18.8% UK inflation (AFR)

  • Former judge to review CA ANZ after cheating scandal (AFR)

  • ASIC investigating an ASX listed company of greening washing (AFR)

  • South32 NSW mine may shut 20 years early (AFR)

  • ASIC says crypto and climate regulation is coming (AFR)

  • Elon Musk subpoenas Jack Dorsey ahead of court battle (BBC)

  • Playstation has been sued for £5B in the UK over "rip off" games (BBC)

  • Cineworld confirms it is considering bankruptcy (BBC)

  • VW aims to take stakes in Canadian mines (RT)

  • Malaysian top court upholds guilty verdict against Najib (RT)

  • Chinese airline owner Juneyao group aims to enter EV market (RT)

  • Ford cuts 3,000 jobs as it pivots to EVs (RT)

Deal Flow

Investments/ M&A

  • Vodafone agreed to a $1.8B (USD) deal to sell its Hungarian business to 4iG and state-run Corvinus Zrt. (FT)

  • DIF Capital Partners & Amber Infrastructure are in late-stage talks to buy NSW-based locomotive, and wagon leasing firm Rail First Asset Management for a deal expected to be between 400-500m (AUD) split 50-50. (AFR)

  • Heartland Group (NZX/ASX) is looking to acquire Sydney-based Avenue bank for an expected $55m (NZD). (NBR)

VC and Fundraising

  • Hillfarrance made a $1.5m (NZD) investment in game studio Hashbane Interactive. (NBR)

Equity Raises 

  • 26 Seasons a vertical farmer is seeking $5.5m (NZD) capital raise. (NBR)

  • Heartland Group (NZX/ASX) announced a $200m (NZD) capital raise to pay off debt and fund future growth. (NBR)

  • Heartshare Resources announced a $4m (AUD) raise via a share placement. (AFR)

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