Call it billion dollar Monday.
Around $20 billion dollars worth of deals positive news announced yesterday and one big negative: the decision by BHP to quit the $US39 billion offer for Potash Corp, and restart the unused $4.2 billion or so of its share buyback (see separate story).
And there was a solid $400 million profit, offset by losses totalling more than half a billion dollars from two companies (see below).
Despite all of that, the market ended the day just in the red, after trading up and down.
Ireland’s woes continue to worry investors, as does the continuing attack on the banks.
AMP and AXA APH revealed a $13.3 billion offer for AXAPH, which has been mooted for several weeks (see separate story).
OneSteel confirmed it was paying $US932 million for steel grinding businesses owned by Anglo American and sited in North and South America (see separate story), but revealed first half earnings would be flat.
And Brambles revealed it would pay $US1.3 billion for a plastic container manufacturer and pallet group (see separate story) and confirmed earnings were on track for an improvement in 2011.
But James Hardie revealed a huge interim loss of more than $US323 million which included a small profit, and the impact of an unfavourable tax judgement.
The continuing depression in the US home building industry didn’t help, either.
Hardie reported an operating profit of $20.7 million excluding asbestos, ASIC expenses and tax adjustments, for the quarter ended September 30, 2010
But it incurred a non-cash charge of $US345.2 million ($A350.15 million) following the dismissal of an appeal against an unfavourable tax assessment.
James Hardie won’t pay any interim dividend for fiscal year 2011.
"The operating environment in the US residential housing market remains challenging and the outlook uncertain," James Hardie chief executive Louis Gries said in the statement.
"Factors such as high levels of unemployment, low levels of consumer confidence, falling house prices, excess housing inventory and limited credit availability have all contributed to the continued weakness in the US housing construction sector."
Mr Gries said a strong contribution from the Asia Pacific businesses (especially Australia) helped to partially offset the US slump.
Hardie cut the full 2011 year outlook as well.
Hardie shares were steady on $5.65.
Incitec Pivot shares fell 13c, or 3.3%, to $3.70 despite revealing a solid full year profit and a boost in the final and full year dividend.
The company said after tax profit (including one off items) was $410.5 million for the year to September 30, up sharply from the loss in 2009 of $221.4 million.
Net profit excluding the one off items was $442.8 million, up 27%, or $95 million on the 2009 figure.
Interim earnings in 2010 were $132.4 million, against $99.6 million, including one off items and $146.2 million (down from $169.8 million) excluding the one offs.
The company said Earnings Before Interest and Tax (EBIT) improved to $648.3 million in 2010, compared with $575.7 million in 2009.
IPL CEO James Fazzino said the Group had delivered a strong result in mixed market conditions, including the challenges of the US economy and volatile fertiliser demand.
The full year dividend has been increased by 77% to 7.8c per share, with the final dividend (unfranked) of 6c per share to be paid on 17 December 2010. Interim was just 1.8c a share, so the company reckons the second half improvement was good enough to give some to shareholders.
Meanwhile Elders slipped in a nasty, but expected loss for the September 30 year of $217.6 million which was better than the more than $400 million loss for the 2009 year.
But combined the company has now lost almost $650 million including one offs and non cash losses and write-offs in the past two years, which would have to be the end of the red ink, otherwise its future and that of CEO Malcolm Jackman would be up for grabs again.
Elders reported underlying EBIT of $34.0 million – down 8% from $37.0 million in 2009
The underlying profit after tax to shareholders was a tiny of $3 million, but that was better than the $24.4 million underlying loss in 2009.
One off or non-recurring items totalling $220.6 million after tax were reported for 2009 and took the full year’s result to a statutory loss (but real) of $217.6 million against the 2009 flood of red ink totalling $432.7 million.
But the shares rose half a cent to 62.5c.
