More guidance for listed companies ahead of the June 30 end of financial year with major industrial, Brambles, feeling the brunt of the market's displeasure with a mixed update.
BXB shares fell just over four per cent (in a weaker market) yesterday on news the company's European CHEP business was not doing as well.
This offset apparently solid figures for the US and the rest of the world for CHEP, good sales figures in the Recall document management business, and another buyback of 10 per cent of the company's shares, to go with a similar one just completed.
Brambles shares fell to a low of $11.99, down 64c, before recovering slightly to $12.08, a loss of 55c on the day.
Brambles, which is due to report its results on August 22, said CHEP had achieved strong growth, sales and profit.
CHEP Americas would deliver its third consecutive year of solid sales growth with underlying sales for the 11 months to May up 8 per cent on this time last year.
Recall grew sales by 11 per cent over the past 11 months with underlying sales growth7 per cent higher.
The company said European sales for its CHEP container and pallet services company grew by less than two per cent for the 11 months to May 2007 compared with the previous corresponding period.
Analysts had been factoring in a gain of around 5 per cent.
And that was the factor behind the sell-off with more than 16 million shares being traded.
Brambles said its European operations were hampered by rising timber prices and increasing pallet repair costs. But it believed sales would increase through further expansion.
(Those higher costs for wood are a direct fallout from China's voracious appetite for commodities. it has been especially active in Europe and Asia, buying up wood supplies).
Not even news of another capital management program could mollify the market.
Brambles said it would embark on another major share buyback and reaffirmed its outlook of strong profit growth and cash generation for this financial year.
Another 10 per cent of Bramble's issued capital would be bought back, subject to shareholder approval at the November annual general meeting.
This buyback means Brambles would have bought back 20 per cent of its total issued capital after buying back 142 million shares since last December. The average price for that buyout was $13.62, well above yesterday's close.
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But it was a better story at funds management group, IOOF Holdings, which produced an earnings upgrade yesterday.
IOOF said the better than expected result would be due to strong cost control and better than budgeted performance.
The booming stockmarket and explosion in super contributions ahead of the tax changes on July 1 would have also played no small part.
IOOF said its underlying net profit after tax (UNPAT) would be in the range of $28 to $30 million, an increase of more than 20 per cent on 2006 net profit after tax (NPAT) of $23.3 million.
There was no difference between NPAT and UNPAT in fiscal 2006, the company said.
"The main underlying reasons for the upgrade in earnings guidance are continuing, strong cost control, above budget inflows to its new Pursuit range of products, and above budgeted investment market performance," IOOF said in a statement.
But the company said 2007 UNPAT would differ to 2007 NPAT by $4.9 million, due to costs associated with its 2006 acquisition of the minority interest it didn't hold in asset management business, Perennial Investment Partners.
Costs associated with the acquisition would also feature in the 2008 financial year, reducing NPAT by $4.8 million, as well as having an impact in fiscal 2009.
IOOF Holdings had a 54.3 per cent jump in net profit in 2006 to $23.3 million.
First half earnings in the current financial year rose 38 per cent to $14.1 million.
In its statement yesterday, IOOF also said it was targeting underlying earnings per share (EPS) growth of 15 per cent in fiscal 2008.
That growth would be on top of this financial year's EPS growth, the company said. It reported eps of 32.6c in 2006.
The market basically liked the news, despite the lower after tax profits over the next couple of years. The shares ended 6c higher (in a weaker market) at $9.85.
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Meanwhile St George Bank has made sure the market won't be spooked by a number of investor briefings it plans to give over the rest of the month by telling the market yesterday what it already knew.
That was that the bank's 2007 and 2008 earnings growth targets are still 'live' and on track to be met.
The bank told the ASX yesterday that it was providing this reaffirmation because of the upcoming investor presentations.
It said its annual earnings guidance was still based on strong growth in its credit card and wealth management businesses and a solid mortgage book.
St George, which is our fifth largest bank, said it was on track to meet its earnings per share (EPS) growth targets of between 11 and 12 per cent in 2007 and 10 per cent in 2008.
Credit quality remained strong and its earnings momentum continued to be driven by strong revenue growth. In the eight months to May 31, growth in credit card receivables was a robust 22.9 per cent on an annualised basis.
Growth in managed funds, through its Advance multi-manager funds and Asgard investment platform, was 28.2 per cent on an annualised basis, thanks to the strong stockmarket.
As well, the new super rules were also having a positive impact, as they were at IOOF.
Residential receivables in its home-lending business grew by 9.8 per cent and were on track to reach its full-year target of 10 to 12 per cent growth.
In 2006, the bank posted higher EPS growth of 14.5 per cent – compared to this year's f
