The doom and gloom has lifted for some companies while others are finding that even in a global crisis, there is nowhere to hide.

The doom and gloom has lifted for some companies while others are finding that even in a global crisis, there is nowhere to hide.

Airports and travel agencies are also doing it very tough in the locked down society, warning the outlook for the remainder of the year is bleak as state governments insist on keeping borders shut, forcing people to delay their holiday plans and flight bookings even further than previously thought necessary.
Sydney Airport took a $51.8 million loss for the first half and announced it would raise $2 billion of equity via a renounceable rights issue so existing shareholders are compensated if they don’t participate to make sure it has enough cash to stay open.
The airport’s investors will not receive any dividends at all in 2020 due to most flights remaining grounded and chief executive Geoff Culbert urged governments not to wait for a virus vaccine before allowing people to travel again.
Sydney Airport’s domestic passenger numbers down 88 per cent in July compared with a year earlier have subsequently slumped 95 per cent in August.
COVID-19 lockdowns haven’t stopped Premier Investments, which owns Just Jeans, from generating record profits  Edwina Pickles
Flight Centre chief executive Graham Turner said pre-tax losses could reach as high as $875 million for the year and urged governments to make plans to ease border restrictions. The travel agency group does not expect its business to return to pre-COVID-19 levels until 2025.
But retailers are bucking the trend, benefiting from structural shifts to online shopping and a healthy injection of taxpayer money through the JobKeeper program.
Premier Investments, chaired by billionaire Solomon Lew, angered big shopping centre owners when the investment company revealed on Thursday it would make record profits for 2019-20.
It came through wage subsidies including JobKeeper in Australia, a rent strike by Mr Lew and his board on stores which they either chose to shut or were forced to shut in government mandated lockdowns, and a spike in online sales.
Premier runs a host of fashion brands including Just Jeans, Jay Jays, Portmans and Peter Alexander along with the stationery brand Smiggle.
While Premier said sales had plunged by 18 per cent in the six months to July 25, its profits are buoyant because of the minimal rent it is paying to landlords and the online boom. It expects profits will be 10 per cent higher than last year. Premier shares on Thursday hit their highest point since February.
It’s a long way from the mood of crisis in late March when Mr Lew and his retail chief executive Mark McInnes closed Premier’s retail store in the first wave of national restrictions, and stood down 12,000 workers.
Mr Lew and Premier had a win on another front too. It has a 26 per cent stake in home appliances group Breville, which on August 13 reported an 11.3 per cent increase in underlying net profit to $75 million for the 12 months ending June.
Households reluctant to head out even as restrictions are lifted outside of Victoria have been buying new toasters, kettles and kitchen appliances as home cooking has a resurgence in the lockdown.
Breville is among the companies that has kept its customers when bricks-and-mortar stores shut during the lockdowns, with sales soaring 25 per cent to $952 million as people moved to shopping online.
CEO James Clayton said it was essential right now for companies to be “pivoting digitally” but questioned how long the online shopping trend would last.
Bedding and homewares retailer Adairs was also a surprise winner at a time when bricks and mortar retail has been crunched.
Adairs chief executive Mark Ronan defended a decision to raise its final dividend after receiving more than $11 million in subsidies under the federal government’s JobKeeper program. Adairs received JobKeeper subsidies after a temporary slump in sales when stores in Australia and New Zealand were closed for up to eight weeks in April and May.
“I don’t think anyone at that point in time expected the sales we saw in June as retail reopened we happened to be in a category that has benefited from people spending more time at home,” Mr Ronan said.
Gold miners are boosting production as demand soars for the safe-haven metal. Ryan Stuart
In-store sales rebounded in June and online sales more than doubled over the 12 months ended June 30, after tripling in the month of April. Total profits were up a better-than-expected 19 per cent to a record $35.3 million.
Meanwhile, the spike in gold prices in volatile financial markets has delivered some big windfalls for Australia’s large gold miners.
Newcrest Mining on Friday announced its largest profit in eight years of $US647 million ($905 million) as the soaring gold price flowed bolstered the bottomline.
Evolution Mining also benefited from the gold spike, and at a time when shareholders in many industrial companies are fretting over dividends being sliced or removed altogether, it will pay out a record dividend.
The company’s net profit after tax jumped to $302 million for the full year, up 38 per cent on last year and it will pay its highest ever dividend of 9¢ a share.
Astute investors with an eye for the big structural trends were piling into industrial warehouse giant Goodman Group in the depths of the stockmarket plunge in late March. The stock went below $10 briefly then but now hovers around the $18 mark.
Goodman Group, whose biggest client is online giant Amazon, surpassed its own guidance for the ninth consecutive year with a 12.5 per cent rise in operating profit to $1.06 billion. It has a global network of industrial warehouses and has tilted heavily to become a major back-end provider for e-commerce.
Up in Queensland, rail group Aurizon has been quietly chugging along, hauling coal from mines to ports with minimal disruption during the virus outbreak, and delivering a healthy 28 per cent rise in net annual profits to $605 million.
The Brisbane-based company is not completely immune to the impact of COVID-19. Aurizon chief executive Andrew Harding warned that earnings in fiscal 2021 will be hit by lower demand for metallurgical coal (used to make steel) from Asia after factories shut down during the pandemic.
But Mr Harding is confident demand for Australian coal will rebound next year and in the meantime, Aurizon’s stock price is being supported by share buybacks.
And while tollroad behemoth Transurban fell into the red, delivering a $111 million net loss as people stayed home during the pandemic, it still paid a full-year dividend of 47¢.
While investors are understandably worried about the impact of COVID-19 on dividends and share prices, many companies have more fundamental problems to deal with.
Telstra, which reported a 14 per cent drop in net annual profits to $1.8 billion, has warned it will keep losing customers to the NBN, which means future earnings will drop making it harder to pay annual dividends at the current rate of 16¢ a share.
Telstra CEO Andy Penn said management was doing everything in its power to replace a widening earnings hole caused by the roll-out of the national broadband network, but warned success would partly depend on market conditions that are out of the company’s control such as competition in the mobile market and NBN wholesale pricing.
And AMP’s half-year results which included a special, fully franked dividend of 10¢ per share were overshadowed by recent revelations of sexual harassment at the wealth management group.
AMP confirmed that underlying profit for the first half of the calendar year was $149 million, down 40 per cent on the first half of 2019, with earnings falling across all divisions.
CEO Francesco De Ferrari is struggling to restore investor confidence in the financial group as questions continue about his judgement and ability to transform AMP’s corporate culture and make it more inclusive following the sudden resignation of AMP Australia boss Alex Wade.
Bank earnings have not been as bad as feared, with NAB reporting that it had received only “a small increase” in new deferral requests from customers in Victoria and CBA delivering a 98¢ final dividend, well ahead of expectations.
While bank analysts are concerned about the status of borrowers with deferred loans, the banks showed their capital positions remain strong despite falling profits.
Insurer QBE, which took a half-year loss of $994 million, mostly caused by natural disasters rather than the pandemic, is at least benefiting from rising premiums and has been rejecting some pandemic-related claims, arguing they exclude COVID-19.

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