Rating changes compiled by Bloomberg
- ANZ Bank: Cut to Hold at Bell Potter; price target $28.50; Cut
to Hold at Jefferies; price target $28; Raised to Outperform at Credit
Suisse; price target $28.50 - APA Group: Cut to Hold at Morgans Financial; price target $9.98
- Altium: Raised to Buy at Bell Potter; price target $40
- Bapcor: Cut to Hold Vs Buy at Morningstar
- Costa Group: Cut to Hold Vs Buy at Morningstar
- Deterra : Cut to Neutral at Credit Suisse; price target $4.20
- GrainCorp: Cut to Hold at Morgans Financial; price target $8.06
- Imdex: Cut to Hold at Canaccord; price target $3.02
- James Hardie: GDRs Raised to Outperform at CLSA
- Super Retail: Raised to Overweight at JPMorgan; price target $14.50
- Wesfarmers: Cut to Neutral at JPMorgan; price target $57
A sharp rise in natural hazard claims has sparked a 29.1 per cent fall in Suncorp’s cash profits to $361 million for the first half, and a cut to the dividend.
The financial conglomerate on Tuesday said its natural hazard claims costs for the six months to December had hit $695 million, which was $205 million more than expected in the first half of the financial year.
While earnings in its flagship insurance division were bogged down by claim costs, Suncorp’s banking arm posted a 5.3 per cent rise in profit after tax, to $200 million.
According to figures from Jarden, the result is ahead of analyst consensus.
Australia has been hit by several damaging storms over the past six months, leading to a high number of insurance claims. Credit:Brook Mitchell
Chief executive Steve Johnston said: “While we have been challenged by the La Niña climate pattern and the operational impacts of COVID-19, we continue to deliver against our strategic priorities and have good momentum as we move into the second half of 2021-22.”
In Suncorp’s flagship insurance division, insurance profit dropped 55.8 per cent to $114 million, after more than 50,000 natural hazard claims in the half.
In its banking arm, lending grew by 2.7 per cent in the half, but as seen among other banks, its net interest margin was squeezed, falling 12 per cent to 1.97 per cent.
As well as the hit from higher-than-expected claim costs, Suncorp said its income from investment markets was also down significantly.
Suncorp will pay a dividend of 23¢ a share, down from an interim payment of 26¢ last year. The dividend is at the upper end of its dividend payout ratio target range of 60 per cent to 80 per cent of cash earnings.
ASX futures down 11 points or 0.2% to 7002 at 8.55am AEDT
- Australian dollar +0.8% to 71.26 US cents at 6.43am AEDT
- Wall Street: S&P 500 -0.4%, Dow Jones flat, Nasdaq -0.6%
- Europe: Stoxx 50 +0.8%, FTSE +0.8%, DAX +0.7%, CAC +0.8%
- Bitcoin +4.8% to $US44,456.83 on Bitstamp at 6.44am AEDT
- Spot gold +0.8% to $US1823.32 per ounce at 6.43am AEDT
- Brent crude -0.6% to $US92.67 a barrel at 6.34am AEDT
- US oil -1.1% to $US91.31 a barrel at 6.34am AEDT
- Iron ore +2.5% to $US128.42 a tonne
- 10-year yield: US 1.91% Australia 1.99% Germany 0.22%
Good Morning, hello and welcome to another session of Markets Live.
The half-year reporting season is starting to get into gear, with results today from Suncorp, Shopping Centres Australia, and the Charter Hall Long WALE REIT.
Your editors today are Lucy Battersby and Colin Kruger.
This blog is not intended as financial advice.
ASX futures down 0.2%; Suncorp lowers dividend as profit falls 29%
Source: Philippines Alive
