ASX 200 rises, Costa smashed, Fisher & Paykel drops

The S&P/ASX 200 Index (ASX:XJO) slightly rose today, the Costa Group Holdings Ltd (ASX:CGC) share price was smashed.

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The S&P/ASX 200 Index (ASX: XJO) went up by 0.03% today to 7,095 points.

Here are some of the highlights from the ASX:

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

The Fisher & Paykel Healthcare share price fell by 6% after the business reported its FY21 result and also gave some commentary about FY22.

FY21 total operating revenue rose 56% to $1.97 billion, with hospital operating revenue growing 87% to $1.5 billion. However, homecare operating revenue only went up 2%.

This led to net profit after tax going up 82% to $524.2 million. The ASX 200 share’s board decided to implement a 42% increase of the final dividend to 22 cents per share.

Given the wide range of scenarios and uncertainties, the company didn’t give guidance but instead made some observations. It said that a global vaccine rollout during FY22 is likely to reduce global hospitalisations requiring respiratory support for COVID-19 compared to FY21.

It also said that its customers’ stocking and de-stocking choices in response to the pandemic are likely to vary over time. The gross margin is likely to be impacted with freight costs likely to remain elevated and air freight a higher proportion of freight. Fisher & Paykel also said it expects to retain its COVID-19 safety practices on its manufacturing sites.

In the financial year so far, hospital revenue continues to remain variable with higher volume of hospital hardware and consumables to locations with hospitalisation surges and an ongoing shift towards Optiflow nasal high flow therapy. OSA shows signs of recovery after a slower fourth quarter.  

Costa Group Holdings Ltd (ASX: CGC)

The Costa share price was smashed by around 24% today after giving a trading update about its different operating segments.

Overall, the 2021 first half performance is expected to be marginally ahead of the comparable period in 2020, with strong international operations offset by challenges in domestic produce conditions.

In its international segment it’s well progressed with its harvests in both China and Morocco. The ASX 200 share said performance has been very positive versus the previous year and expectations.

In China, although volumes were initially slightly down due to late flowering, the yield is expected to finish in line with the company’s expectations. Management said there has been strong pricing and demand over the season.

Costa said that in Morocco, early season plantings in Agadir as well as earlier season higher volumes across its northern farms together with “generally strong” pricing has seen the business perform well, although ongoing supply chain and COVID-19 related costs have had an impact.

However, the ASX 200 share’s international segment is going to be impacted in the reported result by the higher Australian dollar.

Domestically, there is a mixed performance. Overall mushroom demand remains strong, but mushroom production at Monarto has been impacted by short-term labour constraints.

Avocado volumes and quality have been pleasing and export volumes continue to grow. However, it has seen recent pricing pressure due to increased haas variety production across the sector resulting in reduced pricing compared to last year. It is likely this pricing trend will continue into the second half of the year as increased volume is expected to be delivered across the industry.

Current half performance has been impacted by hail damage and fruit fly restrictions. Costa explained that the 2021 calendar year is an ‘on year’ in terms of yield and it is expected that results in the second half of the year, where the bulk of harvest occurs, will benefit from strong yields.

In tomatoes, whilst it has seen some short-term pricing pressure arising from increased tomato supply, this currently abating and pricing is improving.

It was the worst performer in the ASX 200.

Gentrack Group Ltd (ASX: GTK)

The Gentrack share price went up around 15% today in response to the company releasing its FY21 half-year result.

It said that revenue increased 0.7% year on year to $51 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased 63.2% to $7 million. However, the business reported a statutory net loss of $1.1 billion.

Revenue was down in the airport business by $2.1 million due to the industry downturn, but annual recurring revenue (ARR) rose 5.8%.

The business reduced costs by 5% due to cost saving measures. That assisted in the $5.6 million cash generation for the period. It ended with net cash of $22.4 million.

It’s now expecting FY21 EBITDA to be around $5 million and revenue to be similar to FY20 of $100.5 million. Gentrack is expecting to be net cashflow positive.

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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 COSTA GRP FPO. 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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