Last week earnings season went up a gear with a number of popular companies releasing their results.
Two that caught my eye are listed below. Here's a summary of their results:
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Newcrest Mining Ltd (ASX: NCM)
This gold miner's half year results caught the eye of investors last week. Thanks to a strong rise in its realised gold price, Newcrest reported a 48% increase in its All-In Sustaining Cost (AISC) margin to US$842 per ounce.
This ultimately led to Newcrest delivering bumper sales and profit growth during the period. For the six months ended 31 December, Newcrest reported a 21% increase in revenue to US$2.17 billion and a whopping 98% jump in underlying profit to US$553 million.
Also pleasing investors was Newcrest maintaining its guidance for copper and gold production in FY 2021. In fact, it expects its gold production to be at the higher end of its guidance range.
Newcrest's CEO, Sandeep Biswas, spoke positively about the future. He said: "In 2018, we set ourselves some ambitious targets to Forge a Stronger Newcrest. Our progress and achievements over the past three years has put us in a very strong position to not just weather the global uncertainty associated with COVID-19, but to keep our eyes firmly on our future growth agenda."
"We have a fabulous position in our industry, with a long reserve and resource life, a unique set of technical skills, a very strong balance sheet, numerous organic growth options in progress and an exciting exploration pipeline," he added.
Analysts at Morgans were happy with its results. In response to them, the broker upgraded Newcrest's shares to an add rating with a $29.98 price target.
Telstra Corporation Ltd (ASX: TLS)
On Thursday Telstra released its half year results for the six months ended 31 December. While the result itself was a little softer than the market expected (total income fell 10.4% to $12 billion and underlying EBITDA dropped 14.2% to $3.3 billion), management's commentary went down particularly well with investors.
The first comments related to its dividend plans for the full year. Telstra eased concerns of another dividend cut by confirming its intention to pay a 16 cents per share fully franked dividend in FY 2021.
Also going down well with investors were comments by Telstra's CEO, Andy Penn, regarding the future. He has set the company a target of returning to growth in FY 2022.
He said: "I am confident the many initiatives we have taken under our T22 program, particularly in simplifying the business and the digitisation program, will further improve customer experience. "
To get the real benefits from all the effort we've already made, Telstra needs to be bold. I've set an aspiration for mid to high single-digit growth in underlying EBITDA in FY22 and $7.5 to $8.5 billion of underlying EBITDA in FY23. I am confident we can deliver this if we remain focused," he added.
In response to the result, analysts at Goldman Sachs retained their buy rating and lifted the price target on Telstra's shares to $4.00.
