Australian Index Down 1.5%; Qantas Yield Improves on Jetstar

Marcus Jacob
02 Sep, 2011
New York City

The Australian benchmark index dropped 1.5% on Friday and gained 1% in the week. SABMiller turn up heat on Foster

[R]4:30 PM Sydney – The Australian benchmark index dropped 1.5% on Friday and gained 1% in the week. SABMiller turn up heat on Foster’s and questioned company’s outlook in a regulatory filing. Qantas Group reported improved July performance on the success of its discount carrier Jetstar.[/R]

The ASX 200 index fell 64.60 or 1.5% to 4,242.9 and All Ordinaries index declined 61.2 or 1.4% to 4,321.5.

The Australian dollar closed down 0.2% to US$1.0702 and gold price increased $12.22 to US$1,828.90.

In trading, turnover decreased to 1.74 billion shares and the trading value declined to $4.46 billion with 375 stocks closing higher, 650 declining and 366 were unchanged.

SABMiller Questions Foster’s Outlook

The takeover battle for Foster’s heated up after SABMiller in a regulatory filing with the Takeover Panel said that the company made misleading statements in its annual report last month.

Specifically, SABMiller disputed company’s estimate of $887 of net debt and said it is inconsistent with the Australian accounting standard and also said that long term sale and earnings growth are based on no real basis.

Qantas Group Performance Improves

Qantas Group reported 6.2% increase in July passenger count on the rise in discount domestic travel and the grounding of rival Tiger Airways.

The discount carrier Jetstar’s domestic passenger count increased 21.2% and load factor rose 3.7% to 84.5%. The increase in the load factor comes after the capacity increase of 21.5%.

Qantas’ domestic passenger count increased only 1% and its revenues per seat declined ot 82%.

Jetstar, the discount carrier is undergoing a dramatic increase in capacity to expand its reach in Asia. Jetstar seat factor declined 5.4% to 75.9% despite the capacity increase of 47.8%.

Stock Movers

BHP Billiton Ltd decreased 83 cents to $39.04 and Rio Tinto fell $1.03 to $72.05.

Commonwealth Bank of Australia decreased 56 cents to $47.52 and National Australian Bank fell 34 cents to $23.51. ANZ declined 35 cents to $19.92. Westpac Banking Corp eased 21 cents to $20.51.

Qantas Airways increased 3.5 cents to $1.63 after the national carrier reported an improvement in passenger fares in July.

Woodside Petroleum decreased 8 cents to $35.10 and Santos added 31 cents to $12.06. Oil Search increased 5 cents to $6.37.

Telstra increased 3 cents to $3.03 and chief executive David Thodey told analysts today that transferring its customers to NBN and decommission its copper network gradually is the best regulatory and financing alternative to the company.

Fairfax Media added 1 cent to 88 cents.