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Market close: ASX 200 drops 0.7% today

The S&P/ASX 200 Index (ASX: XJO) fell by 0.7% today to 6,011 points.

COVID-19 continues to spread in the south east of the country. Victoria announced another 317 confirmed cases – the largest increase since the start of the pandemic. Meanwhile, NSW announced 10 more COVID-19 cases. Four of them were in hotel quarantine, three were associated with the Crossroads Hotel and another three are ‘under investigation’.

Australia’s unemployment rate rises

The latest employment stats from the Australia Bureau of Statistics (ABS) were a mixed bag.

Australia’s unemployment rate increased from 7.1% in May to 7.4% in June, with an additional 69,300 people unemployed. However, on the plus side there were also an extra 210,800 more people employed. This included 38,100 less full time employees and 249,000 more part-time employees.

The share price of ASX 200 employment site SEEK Limited (ASX: SEK) rose by 1% today and the Commonwealth Bank of Australia (ASX: CBA) share price fell 0.1%.

BWX Ltd (ASX: BWX) launches a capital raising

Beauty business BWX is launching a capital raising to fund the development and construction of a new manufacturing facility and support office. The facility is expected to be earnings per share (EPS) accretive in FY23 and onwards.

It’s going to be funded by a fully underwritten institutional placement of $40 million at a share price of $3.40. This price is a 7.1% discount to the last closing price of $3.66.

The facility should result in improved labour productivity and efficiency improvements, material waste reduction of around 50% and material cost reduction.

BWX also announced some unaudited FY20 numbers. Revenue increased by 25% to $187.6 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) (pre-AASB 16) rose by 30% to $27.5 million. The gross profit margin increased to 58%. Net debt improved from $42.8 million last year to $32 million at 30 June 2020.

BWX Chief Operations Officer Mr Rory Gration said: “This world class facility is expected to significantly boost BWX’s in-house manufacturing capacity, capability and competitive advantage; provide up-skilling opportunities for our team; enhance the ways in which we serve our retail partners, customers and consumers all over the world.”

Medibank Private Limited (ASX: MPL) resolves ACCC proceedings

Medibank announced this afternoon that it has resolved Australian Competition and Consumer Commission proceedings regarding ahm’s boost and lite products with the federal court approving the agreed settlement with the ACCC.

The ACCC has also accepted an enforceable undertaking offered by the ASX 200 private health insurer.

These proceedings relate to representations made by ahm when responding to claims and eligibility enquires by customers for joint investigations and reconstruction procedures under ahm’s boost and lite products.

Medibank will pay a $5 million penalty as well as a payment of $400 to customers who have not yet submitted or have not received payment for a claim of compensation. This payment is expected to be made to around 670 customers.

The Medibank share price fell 1.3%, but it wasn’t one of the worst performers in the ASX. That was Breville Group Ltd (ASX: BRG)

Beacon Lighting Group Ltd (ASX: BLX) share price shines

The Beacon share price went up almost 10% today after giving a trading update for FY20.

Reported sales were $252 million, an increase of 2.6%. Underlying sales, excluding Beacon Energy Solutions, amounted to $251 million – this was growth of 8%. Company stores achieved comparative sales growth of 7.2%. Online sales growth was 50.6%.

Reported FY20 net profit after tax is expected to be approximately $22 million, representing growth of 38.5%. Underlying net profit after tax is expected to be around $19 million, up 16.7%. The underlying profit measure excludes the Parkinson Distribution Centre sale, the AASB 16 lease accounting changes and Beacon Energy Solutions.

Beacon Lighting CEO Glen Robinson said: “Despite the disruptive times over the second half of FY20, the group has been able to achieve outstanding results. These results would not have been possible if it was not for our adaptable and resilient team at Beacon Lighting and the continued support of our valued customers. Our ongoing commitment to innovate the lighting and ceiling fan categories, ensures our customer receive the latest products.”

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended BWX Limited. The Motley Fool Australia has recommended SEEK Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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