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ASX 200 finishes up 0.4%, Rio Tinto grinds higher

ASX 200
Credit: Cimexus

The S&P/ASX 200 Index (ASX: XJO) finished higher by 0.4% today to 6,034 points.

COVID-19 continues to feature in the headlines. Victoria reported its highest number of COVID-19 cases with 428 new confirmed cases and NSW announced eight new cases. In response, NSW has announced new restrictions.

Here are some of the main news items from the ASX 200:

Rio Tinto Limited (ASX: RIO) grinds higher

The Rio Tinto share price climbed 0.6% after releasing the production numbers from its 2020 second quarter.

Compared to the first quarter of 2020, iron ore shipments rose by 19% to 86.7 Mt, iron ore production grew 7% to 83.2 Mt, bauxite production increased 5% to 14.6 Mt, aluminium production was flat at 785 kt, mined copper production saw no growth with 132.8 kt, titanium dioxide slag production fell 10% to 262 kt and IOC iron ore pellets and concentrate production rose 8% to 2.8 Mt.

The ASX 200 company said that capital expenditure is now expected to be around $6 billion in 2020 due to an appreciation in currencies compared to the US dollar in the first quarter. Capital expenditure for 2021 and 2022 is now expected to be around $7 billion – up from $6.5 billion.

Rio Tinto chief executive J-S Jacques said: “We delivered a strong performance, particularly in iron ore and bauxite, demonstrating the resilience of our business and ability to adapt in difficult conditions. Our iron ore assets are performing well in a strong pricing environment and we are on track to meet our 2020 iron ore guidance. Despite various COVID-19 related challenges, all our assets have continued to operate, with our first priority to protect the health and safety of all our employees and communities.”

BWX Ltd (ASX: BWX) completes placement

The BWX share price jumped 18.6% today after coming back to trading on the ASX.

The natural beauty business announced today that it has successfully completed its $40 million fully underwritten institutional placement at $3.40 per share. The company now has raised enough cash to build a new manufacturing facility for a cost of $33.7 million.

BWX said the placement received strong interest from existing institutional shareholders as well as new investors.

Dave Fenlon, CEO and managing director of BWX, said: “We are very pleased with the strong support from our institutional shareholders who are right behind our plans to transform BWX’s operating model with the development of a new world-class manufacturing facility.

“Following a strong FY20 trading performance, we are committed to using the placement proceeds to invest in the new facility which we expect can solve capacity constraints, unlock significant efficiency gains and deliver growth over and above our three year strategic plan.”

BlueScope Steel Limited (ASX: BSL) impairment

ASX 200 share BlueScope today announced it expects its FY20 underlying earnings before interest and tax (EBIT) for FY20 to be around $560 million with the June 2020 half showing an EBIT contribution of around $260 million. It finished June 2020 with a net cash balance of around $100 million.

Whilst the overall picture was solid, the company expects to include an impairment of around $200 million for its New Zealand and Pacific Steel segment because of updated expectations of lower sustainable earnings in the longer-term. The company is doing a strategic review of the New Zealand operations.

Integrated Research Limited (ASX: IRI) share price rises more than 3%

Integrated Research pleased investors today with an update about its revenue and profit guidance for FY20.

Licence sales are expected to be in the range of $70.8 million to $72.3 million. This would be growth of 13% to 15%. The strongest performance was from the company’s ‘unified communications’ product line.

The company said that its total revenue is expected to be in the range of $109.5 million to $111 million. This represents growth of 9% to 10%. Net profit after tax is expected to be in the range of $23.6 million to $24.2 million. This would be growth of 8% to 11%.

The full accounts are expected to be released to the ASX on 20 August 2020.

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Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Integrated Research Limited. The Motley Fool Australia owns shares of and has recommended BWX 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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