Friday saw two more profit/sales downgrades and one maybe.
Hills Industries warned early in the day of a 10% fall in the first half profit, then Gunns cut its forecast for the 2011 underlying profit 20% and later in the day Toll Holdings seems to have warned of softening trading, but it was done in the usual elliptical fashion.
Hills shares fell 1.4%, or 3c, to $2.16 for its warning.
Gunns shares fell 5.5c, or 7.5%, to 67.5% for its warning which was at least better than the 20% pounding handed out for a downgrade to the 2010 profit earlier in the year
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And Toll shares fell 1.7%, or 11c, to $6.20, with the meeting also canning proposals to restrict board elections and abandoned plans to give CEO Paul Little more options after he revealed earlier in the week plans to retire in 2010.
Toll shareholders heard from Mr Little that the company expects local business outside the resources sector to be sluggish heading into the festive season.
He said trading had lifted during 2010 but the company expects the rate of improvement to be subdued ahead of Christmas.
"Whilst trading conditions and volumes improved in the second half of the 2010 financial year and these conditions continued into the current year, we don’t anticipate above-forecast trading from key market sectors within Australia, in the lead up to Christmas," Mr Little told the meeting.
"Our offshore operations in Asia, the US and the UK are showing strong signs that will underpin continued momentum into the second half of the current year."
The resources sector continues to underpin the local economy, said Mr Little, who is preparing to step down as CEO in 2012.
"Conditions in Australia excluding resources remain flat, with our major retail customers experiencing a slightly slower than anticipated pre- Christmas build up," he said.
Toll revealed last February a dip in first half earnings and when queried by regulators, pointed to similar comments made at the AGM and earlier.
So look forward to either an update in February or the results for the December half when released a little later in the month.
But Mr Little also said Toll had begun the 2010-11 financial year stronger compared to the previous year.
"Whilst fallout from the global financial crisis continued to challenge the company during the 2010 fiscal year, particularly in Australia, encouraging signs of improved volumes and associated activity was evident in the fourth quarter," he said.
"Importantly, these improved conditions have carried on into the start of the 2011 year."
But with Toll doing logistics for many major local companies, especially Woolworths, its comments about the "flat" trading conditions, especially among retailers, matches warnings and updates from domestic facing companies.
Meanwhile Gunns downgraded its 2011 outlook by around $10 million to an underlying EBIT of $40-$50 million, from the $50 to $50 million forecast in August.
It said the dip from August advice was driven largely by the strong dollar and a landmark Tasmanian forests logging peace pact.
Friday’s update on Gunns’ operations was issued only days after its annual report was lodged, and offered reassurance of the company’s direction.
"Although we acknowledge that the full year guidance is a wide range, timing uncertainty around significant potential developments across our business in what is a year of transition precludes a more precise forecast," Gunns said in its update.
Gunns said the "strength of the Australian dollar versus the US dollar has significantly impacted the competitiveness of hardwood chip exports into our key markets of China and Japan.
"Japanese demand in particular remains depressed.
"We do not expect any currency relief in the period to June 2011 and have adjusted our forecast accordingly.”
