A number of updates emerged after the long weekend, with the headline act coming from metal recycler Sims Ltd, which produced its second earnings upgrade in the past year.
Sims told the ASX that it now expects to see full-year earnings before interest, tax, depreciation and amortisation (EBITDA) of between $360 million and $380 million.
That’s a jump of 22.5% at the upper end of previous guidance, which was for full-year EBITDA of between $260 million and $310 million.
Despite the dramatic nature of the upgrade, Sims shares hardly moved – closing 1.3% higher to $16.93.
But that was after the shares bounced to a 52-week high in trading of $17.69.
The upgrade is due to higher scrap prices and the strong global demand for resources, especially metals and ores.
“In our April release, we factored in justifiable concerns that the rapid rise in prices commencing in December 2020 contributed to exception EBIT that would not be sustained in the fourth quarter,” chief executive Alistair Field told shareholders this morning.
“It is pleasing that this is not the case and we are forecasting the fourth quarter to be as strong as the third quarter.”
The main risk to the updated guidance is in the logistics of the “assumed June shipping schedule”, according to the company’s update.
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After the woes at Macquarie Group’s first dud float, Nuix (see separate story), slightly better news for its other poor IPO from this year, Keypath Education.
The company on Tuesday lifted guidance in what should be a confidence-booster for investors who have been underwhelmed by the performance of the online education provider since its float this month.
The US-based company this morning lifted its financial year 2021 revenue guidance from US$91 million to between $US94 million and $96 million.
“Positive momentum in the business has continued throughout the fourth quarter, driven by robust enrolment growth and strong student retention during the quarter,” the company said.
In its float at the start of this month, Keypath debuted below its $3.71 IPO price and fell to a low of $3.26 in the week it listed.
The stock ended the day at $3.55, up 5.6%.
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Shares in Perth-based shipbuilder Austal slumped on Tuesday after the company cut full year profit and revenue guidance with only 2 weeks to go to the end of the financial year.
The shares closed down 9% at $2.12.
That was after Austal cut its full-year guidance, blaming the impact of supply chain disruptions for its shipyards and the expected costs or possible fines from recent regulatory legal action.
The company told the ASX on Tuesday that it now expects to see earnings before interest and tax of between $112 million and $118 million, down 10.4% from previous guidance of $125 million.
Austal said it now sees revenue for the year around $1.55 billion, rather than $1.65 billion “due to delays experienced on programs and associated costs caused by COVID-19 related border closures, travel restrictions and resourcing challenges that are impacting Austal’s shipbuilding operations in Australia and the Philippines.”
The company also said it had to make provisions for the cost of Federal Court action launched by The Australian Securities and Investments Commission.
ASIC last week launched civil proceedings against the company for allegedly breaching continuous disclosure laws and engaging in misleading and deceptive conduct.
It claims Austal withheld market-sensitive information about costs related to major design flaws with its fleet of US navy warships.
