Earnings at Qantas, Wesfarmers, Lend Lease, Santos Rise

Marcus Jacob
17 Feb, 2011
New York City

Stocks in Australia traded higher and the Australian dollar inched up. Qantas first-half net soared four-fold on 10% increase in revenues in the first-half. Wesfarmers net rose nearly 25%. Lend Lease first-half net increased 10% on sales decline of 22%. Santos net increased 15%.

[R]4:00 PM Sydney – Stocks in Australia traded higher and the Australian dollar inched up. Qantas first-half net soared four-fold on 10% increase in revenues in the first-half. Wesfarmers net rose nearly 25%. Lend Lease first-half net increased 10% on sales decline of 22%. Santos net increased 15%.[/R]

ASX 200 index closed up 8.2 to 4,938.40 and All Ordinaries index gained 7.4 to 5,026.

The Australian dollar inched higher but traded in a narrow range ahead of the release of U.S. inflation data.

The Australian dollar fetched US$1.0033 from US$0.9984 and against the Japanese yen at 83.81 from 83.59.

Qantas Net Surges Four-fold

Qantas first-half net soared to $239 million from $58 million on revenues increase of 10% to $7.6 billion. Most of the increase in revenues flowed to the bottom line as international long haul passenger traffic increased.

Qantas said that it maintained its leading market share in the domestic market and it is the most profitable airline in the domestic market. Qantas also said its domestic market share was at 65% and an increase in domestic business travel lifted last seen in 2007.

Qantas Frequent Flyer with 7.5 million members recorded earnings increase of 20% to $189 million and Qantas Freight earnings soared 141% to 41 million.

The airline is in discussion with Rolls Royce to fix the A380 engine that blew up and the company is confident that the engine maker and insurance coverage will cover most of the cost of fixing the plane.

Wesfarmers Earnings Rise on Resource Division

Wesfarmers, the retail and mining conglomerate, said first-half sales rose 6% to $28.07 billion and net increased to $1.17 billion from $879 million a year ago period.

The resource division’s pre-tax earnings soared to $250 million from $2 million in the year ago period.

Coles, the retail arm, earnings before interest increaed18.3% to $575 million and the Bunnings hardware EBIT increased 8.3% to $457 million.

The conglomerate lifted its dividend to 65 cents a share form 55 cents in the prior year period.

Stock Movers

AMP increased 5 cents to close at $5.50 after profit for the full-year increased 5%.

BHP Billiton increased 5 cents to $46.64 and Rio Tinto declined 51 cents to $87.65. BHP and Rio announced share buybacks of US$10 billion and US$5 billion at the time of earnings release.

Lend Lease increased 19 cents to $9.08 and estimated net income for the full year. The largest property developer said first half profit increased 10% to $226.5 million but revenues declined 22.2% to $4.3 billion. The company declared interim dividend of 20 cents a share.

Santos surged 3% to $14.24 after full year net increased 15.2% on higher fuel prices.

Qantas added 13 cents or 5.4% to $2.52 and Virgin Blue increased 1 cent to 40 cents a share.

Qantas reported four-fold increase in profit in the first half and said it will increase capacity in the second half by 11% from a year ago and extend lease on 40 domestic aircraft over the next few years.

Virgin Blue said it will increase fuel surcharge for the flights to the U.S. and lift baggage handling charges.

Zambezi Resource declined 0.5 cent to 4.1 cents on a heavy trading volume of 118.5 million after it announced the initial assessment of its preliminary drilling at its Kangaluwi project in Zambia.