Aussie Dollar 10-Year High; Stocks Consolidate

Darlington Musarurwa
23 Feb, 2010
New York City

Australian dollar traded at a ten-year high against the euro and strengthened against the yen and the U.S. dollar. Aristocrat Leisure reported a full year loss of A$157.8 million. Amcor net profit soars increase 2.3% in the first half.

[R]3:00 AM New York, 7:00 PM Sydney – Australian dollar traded at a ten-year high against the euro and strengthened against the yen and the U.S. dollar. Aristocrat Leisure reported a full year loss of A$157.8 million. Amcor net profit soars increase 2.3% in the first half.[/R]

The Australian stock index closed unchanged and commodities weakened. The Australian dollar strengthened and traded at 10-year high against the euro.

The Australian dollar traded 66.12 euro cents, at 90.14 U.S. cents and at 82.05 yen.

In Sydney trading ASX 200 Index rose 0.02% or 0.8 to 4,718.30.

Of the ASX 200 index stocks, 78 gained, 106 fell, and 16 were unchanged. Charter Hall Group led gainers in the index shares with a rise of 6.3% followed by Ausenco Ltd advancing 4.3%.

Financial stocks advanced 0.9% to 0.9% to A$26.36, Commonwealth Bank edged up 0.8% to A$54.55 and ANZ jumped 0.8% to A$22.73.

ACCC Might Limit M&A in Financial and Retail Sectors

The Australian reported today that UBS’s head of Mergers and Acquisition Anthony Sweetman said the Australian Competition and Consumer Commission has indicated that it will limit domestic mergers among the country’s big four banks and big retailers.

According to Sweetman, companies that are in financial stress and government privations will provide opportunities for mergers in the next eighteen months.

The report notes that deals are likely to remain complex and are unlikely to get back to the booming levels of 2006 and 2007.

An estimated US$160 billion was raised by Australia corporate through mergers and acquisitions last year.

Aristocrat Leisure Net Loss A$157.8 million

Aristocrat Leisure reported today that the company realised a loss of A$157.8 million for the year ending December, a sharp decline from the comparable year ago period.

Revenue from ordinary activities decreased 15.9% to A$908 million.

Impairment charges in the first half and a provision of A$187 million after tax for damages relating to a legal dispute with bond investors in the US affected the performance in the period.

Aristocrat indicated that the company is working to complete its restructuring and chief executive Jamie Odell said 2010 is going to be another tough year.

Amcor Net Rises 2.3% in H1

Amcor net profit in the first half ended December increased 2.3% to A$95 million from A$92.8 million a year ago on 16% sales decline to A$4.08 billion from A$4.84 billion a year earlier on reduced demand for packaging products and a rising Australian dollar.

Stronger Australian dollar reduced underlying earnings by A$16.4 million.

The company noted that the US$1.95 billion acquisition of Alcan will help it add shareholder value and improve its operational performance and reduce costs.

Amcor will pay an interim dividend of 12.5 cents compared to 17cents a year ago.