Good news for shareholders in fund manager and trustee, Perpetual: they can expect a higher dividend and a higher profit for the December six months.
The company yesterday reaffirmed its first half 2010 profit guidance and says net profit after tax will be between $40 million and $50 million.
In a briefing document released to the market yesterday the company said it was confident of paying a dividend of around 60 cents a share for the December half year.
That would be in line with the June 2009 half dividend and 50% higher, or 20 cents, than the reduced payout from the first half 2009 dividend.
If achieved, the forecast first half 2010 net profit would be more than triple Perpetual’s first half 2009 net profit of $14.2 million.
Perpetual’s forecast assumes underlying profit for the December 2009 quarter will be in line with the September quarter.
If equity markets continue around current levels, underlying profit after tax for the first half 2010 is expected to be between $30 million and $40 million, Mr Deverall says in the presentation.
Underlying profit for the first half 2009 was $41.6 million.
Perpetual first announced its first half 2010 profit guidance on October 22.
The fund manager also said on Wednesday that it was seeing improved client investor confidence, a net positive impact of regulatory reviews, and would continue to invest in its sales capability and service offering.
The company also will continue to pursue acquisitions of high net worth advice practices, chief executive David Deverall said in the business strategy presentation.
Perpetual shares eased 28 cents to $32.50.
And in an interesting move, BlueScope Steel has revealed its first major expansion project for more than a year, but it’s not in Australia but in Indonesia, which escaped the global crunch and downturn with barely a lost beat.
BlueScope told the market yesterday in a short statement that it will boost capacity at its plant in Indonesia following the completion of construction of a second metallic coating line to take advantage of improved demand.
BlueScope halted expansion of the plant in 2006 to concentrate on projects elsewhere in Asia.
It went back to the project in May of this year and has been doing work to prepare it for the new expansion spending.
Managing director and chief executive Paul O’Malley announced the restart of the construction at the plant in Cilegon on Wednesday, saying it will be commissioned around mid 2011.
BlueScope Steel head of Asia Sanjay Dayal said market conditions in Indonesian, and particular residential steel demand, have improved this year.
“Domestic market conditions, in particular residential steel demand, have improved," he said.
"Since May 2009, our existing metal coating line has been operating at full capacity and we have been importing finished steel from our other operations in the region to meet Indonesian customer demand.
"We believe that now is the right time to complete this important project and boost our capacity in this key market.”
BlueScope has spent $US86 million ($A92.99 million) on the project to date.
The estimated cost to complete the project is a further $US40 million ($A43.25 million), with approximately $US10 million ($A10.81 million) in fiscal 2010 and $US30 million ($A32.44 million) in fiscal 2011.
The company said the principal remaining work is completion of the plant facilities, equipment installation and commissioning.
The plant’s existing line allows for 100,000 tonnes per annum of metallic coated and 40,000 tonnes per annum of painted steel production.
The new line will produce thin gauge coil for residential construction applications.
Total combined capacity will rise to 265,000 tonnes per annum of metallic coated and 160,000 tonnes per annum of painted steel.
BlueScope shares rose 8 cents yesterday to finish at $2.90, up 2.8%.
