With results season well and truly underway, last week saw mixed results for ASX shares.
Fears over the spread of coronavirus weighed on some ASX shares, but the S&P/ASX 200 (INDEXASX: XJO) finished the week at 7,130 points, just 2 points off January's record high of 7,132.
Earlier today, I wrote about the top 5 ASX shares that surprised on the upside. Below, we take a closer look at those that disappointed.
Here are the top 5 ASX share price fallers from last week.
Blackmores Limited (ASX: BKL)
Blackmores shares plunged following the release of its half-year results and a profit warning for the second half. Shares fell 17.7% over the week to close at $73.60 last Friday as Blackmores scrapped its interim dividend. Net profit after tax (NPAT) fell 48% to $18.3 million in the first half from $34.3 million in 1H19. Full year NPAT is expected to be in the range of $17 million to $21 million.
Blackmores' transition to manufacturing has put pressure on the second-half result, which is expected to include $13 million in adverse cost of goods impact. The company took ownership of its Braeside manufacturing plant in October. Since then, adverse cost consequences from capacity underutilisation, increased raw material costs, and changes to the manufactured product mix have become apparent.
The outbreak of the coronavirus has caused fallout in China, one of Blackmores key growth markets, as well as supply chain disruptions. Channels that rely on the free flow of passengers such as duty free, small business traders, and tourists, have been disrupted. Some e-commerce partners have cancelled or modified February promotions due to the slowdown in China inbound and internal freight, which has made it difficult to serve the local market.
Today, the Blackmores share price has continued its downward slide, dropping another 2.64% at the time of writing.
Beach Energy Ltd (ASX: BPT)
Last week, Beach Energy shares fell 11.3% to close the week at $2.11 following the release of its half year results. The company reported that its sales revenue declined 6% to $900 million from $955 million in 1H19 while net profit after tax (NPAT) declined 2% to $279 million.
Beach Energy reported a 15% reduction in production from 15.2 million barrels of oil equivalent (MMBoe) to 13 MMBoe. Sales volumes declined 16% from 16 MMBoe to 13.4 MMBoe. Although average realised oil price increased 4% to $104.6 a barrel, operating cash flow declined 27% to $351 million from $479 million in the prior corresponding period.
Beach Energy decreased its full year production guidance from 27–29 MMBoe to 27–28 MMBoe and increased its full year capital expenditure estimate from $750–$850 million to $875–$950 million. Guidance for underlying earnings before interest tax depreciation and amortisation was tightened to $1.275–$1.35 billion from $1.25–$1.4 billion.
Beach Energy shares have rebounded slightly today and are currently up 2.13% on Friday's close.
Adelaide Brighton Ltd (ASX: ABC)
Adelaide Brighton shares fell 9.6% last week to finish at $3.20. Although there was no news out of the construction materials company last week, its shares have been on a downward trajectory since late January. The ACCC completed an investigation into the acquisition of a 43% stake in Adelaide Brighton by Barro Group Pty Ltd and related entities at the end of January.
The ACCC looked into the acquisition as the two vertically integrated companies have overlap in the market for the supply of cement, pre-mixed cement, and aggregates. Nonetheless, the ACCC found the acquisition would not substantially lessen competition as both Barro and Adelaide Brighton will continue to face competition from Boral Limited (ASX: BLD), Holcim Australia Pty Ltd, and Hanson.
The Adelaide Brighton share price has dropped 34.62% over the last year, which has pushed its dividend yield up to 6.19%. Insiders have taken advantage of the falling share price to make a number of buys over the past year while there have been no insider sells.
Adelaide Brighton shares are currently up 0.94% in today's trade.
Orora Ltd (ASX: ORA)
Orora shares closed last week down 9.4% at $2.88 as the company reported its half year net profits after tax slid 13.3% to $76.6 million. Despite a 13.3% increase in sales revenue to $1,835.2 million, earnings before interest and tax (EBIT) fell 4.1% to $133.1 million. Earnings per share decreased 11.1% to 6.4 cents, although the interim dividend of 6.5 cents per share was unchanged.
Revenue and EBIT increased in the Australasian business but declined in the North American business, where an improvement program is in process. Orora reported tough conditions in all markets. Uncertainty relating to the coronavirus coupled with the bushfires and drought in Australia are expected to continue to bring challenging conditions throughout the remainder of the year.
The Australian business is focused on pursuing organic growth and implementing cost reduction opportunities. In North America, the focus is on consolidating and delivering on restructuring programs. Reported operating EBIT is expected to be lower in FY20. Orora shares have risen slightly today and are currently trading for $2.89, which is 0.34% up on Friday's close.
Southern Cross Media Group Limited (ASX: SXL)
Shares in Southern Cross Media Group ended the week down 8.4% at 76.5 cents. Although there was no official news from Southern Cross last week, it is due to report its interim results this Thursday. Shares in Southern Cross Media Group have been in decline since mid-2019.
Currently trading on a price-to-earnings ratio of 9.11 and a dividend yield of 9.2% (according to CommSec), Southern Cross downgraded guidance last year when weak media markets resulted in an 8.5% drop in revenue in 1QFY20. The majority of Southern Cross' assets are in radio, where it generates 85% of its earnings. The group owns more than 80 radio stations across metropolitan and regional Australia, including heavy hitters Triple M and Hit.
Given its low valuation, there has been speculation that Southern Cross may be a target for acquisition. Its exposure to certain 'regional' markets including Canberra, Hobart, and the Gold Coast is considered favourable, due to high population density and disposable incomes in these areas.
Nonetheless, radio advertising fell by 6.1% in the 2019 calendar year according to Adnews, as business confidence suffered in the wake of the bushfire crisis with a flow on effect on ad spend.
Southern Cross Media is among a number of radio companies that have joined the 'Advertise or die' campaign to encourage brands to spend more on its platforms.
Southern Cross Media shares are up 0.65% to $0.77 at the time of writing.
