ASX 200 drops, Appen sinks, Nine jumps

The S&P/ASX 200 Index (ASX:XJO) fell by around 0.9% today. The Appen Ltd (ASX:APX) share price sank after reporting its FY20 result.

The S&P/ASX 200 Index (ASX: XJO) dropped by 0.9% today to 6,778 points.

Here are some of the highlights from the ASX:

a woman

Appen Ltd (ASX: APX)

Appen was the worst performer in the ASX 200 today, falling by 12% in response to its FY20 result.

The technology business reported that its revenue increased by 12% to $599.9 million. It said that it had a growing customer base including 136 new customer wins in 2020. There was also a 34% increase in the number of projects with its top five customers. It revealed that China revenue is growing by 60% quarter on quarter.

Appen's committed revenue increased to 31% of the FY20 second half's total revenue, up from 12% in the first half.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 8% to $108.68 million. The statutory EBITDA growth was stronger, rising by 23%. The underlying EBITDA margin declined by 70 basis points to 18.1%.

Whilst statutory net profit after tax grew 23% to $50.5 million, underlying net profit only rose by 1% to $64.4 million.

Appen decided to pay a final dividend of 5.5 cents, up 10% on the final FY19 dividend.

The company said that the FY21 year-to-date revenue plus orders is approximately $240 million. It's expecting FY20 EBITDA to be between $120 million to $130 million, which is growth of 18% to 28% compared to FY20.

Nine Entertainment Co Holdings Ltd (ASX: NEC)

The Nine share price was the best performer in the ASX 200, rising by almost 10% after reporting.

The media company said that revenue was down 2% to $1.16 billion. It said that there was continued audience strength across all key platforms, with a marked improvement in advertisement markets through the second quarter, with strong growth in broadcast video on demand (BVOD) and free to air (FTA).

Whilst revenue dropped, Nine's group EBITDA jumped 42% to $355.4 million and net profit after tax grew 69% to $177.7 million.

Looking at the broadcast segment, revenue fell 1% but costs declined 15%, leading to a 43% increase in EBITDA to $207.4 million. The EBITDA margin improved by 10.3 percentage points to 33.4%.

It was a similar story for publishing – revenue dropped 9%, but costs fell 17%, leading to EBITDA growth of 27% to $68.1 million. The EBITDA margin improved 7.3 percentage points to 25.9%.

Stan had a particularly strong half-year thanks to subscriber gains. Revenue grew 28% and costs only increased by 10%, leading to EBITDA growing by 161% to $36.5 million. The EBITDA margin increased by 12.5 percentage points to 24.5%. Stan recently launched Stan Sports as an additional plan to attract customers.

The company paid a half-year dividend of 5 cents per share, the same as last year.

Nine said that the advertising market continues to show strength right now, with television in-particular benefiting.

Other movements in the ASX 200

Looking at the green end of the share market, the Idp Education Ltd (ASX: IEL) share price rose 7.2% after reporting its result. The bronze medal went to the Platinum Asset Management Ltd (ASX: PTM) share price, rising by 6.4% after revealing its report.

At the red end of the ASX, the Nanosonics Limited (ASX: NAN) share price dropped 8.1% after reporting. The SEEK Limited (ASX: SEK) share price went down another 7.8% after revealing the sale of a large part of its Zhaopin stake.

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 Appen Ltd, Idp Education Pty Ltd, and Nanosonics Limited. The Motley Fool Australia has recommended Nanosonics Limited and SEEK Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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