ASX 200 rises, NIB plummets, Sonic drops

The ASX 200 rose and the NIB share price fell heavily.

The S&P/ASX 200 Index (ASX: XJO) finished the day higher by 0.4% to 7,490 points.

Here are some of the highlights from the ASX:

bull market encapsulated by bull running up a rising stock market price

Image source: Getty Images

NIB Holdings Limited (ASX: NHF)

The NIB share price fell around 11% after the private health insurance business reported its FY21 result.

It said that group underlying operating profit (UOP) went up 39.5% to $204.9 million. The group underlying revenue increased 2.9% to $2.6 billion, whilst the group claims expense went up 2.5% to $2 billion. The total group expenses fell 8.8% to $362.1 million.

Total net profit after tax surged 84.5% to $160.5 million – this included the benefit of $51.8 million of net investment income. Its return on invested capital (ROIC) was 19.1%, similar to the pre-pandemic levels.

The board declared a final dividend of 14 cents per share, up from 4 cents last year.

The ASX 200 share said that it expects market conditions for FY22 to remain similar to the past 12 months, with the pandemic having mixed consequences.

Management said the ongoing COVID-19 threat will further encourage private health insurance participation throughout Australia and New Zealand.

It's expecting Australian resident health insurance net policyholder growth to be in the range of between 2% to 3% and for growth in its New Zealand business to be consistent with recent years.

NIB said that there will be less healthcare treatment of all kinds as long as lockdowns persist.

Sonic Healthcare Ltd (ASX: SHL)

The Sonic Healthcare share price dropped around 3% today after releasing its FY21 report.

The ASX 200 healthcare business revealed that revenue increased by 28% to $8.8 billion, predominately thanks to the millions of COVID-19 PCR tests it's doing around the world. Excluding the testing, FY21 global base revenue (excluding COVID testing) was up 6%.

COVID test volumes were lower in the FY21 second half compared to the first half, but are now increasing with the spread of the Delta variant.

Sonic's earnings before interest, tax, depreciation and amortisation (EBITDA) increased 81% to $2.6 billion and the net profit rose 149% to $1.3 billion.

The board continue its progressive dividend policy with an 8% increase of the final dividend to 55 cents per share. That meant the total dividend was up 7% compared to FY20.

Sonic said that its balance sheet is set for growth by acquisition, with gearing at a record low level and $1.5 billion of liquidity currently available.

The ASX 200 healthcare company said its core business is increasingly resilient to pandemic waves and COVID PCR testing is expected to continue for the foreseeable future.

Reliance Worldwide Corporation Ltd (ASX: RWC)

Plumbing product business RWC reported its FY21 result today.

It said that net sales increased by 15% to $1.34 billion. Net sales were up 25% on a constant currency basis.

The Americas recorded 27% constant currency growth. Asia Pacific saw constancy currency sales growth of 18% for the year, driven by "strong" Australian residential construction and remodelling activity. RWC noted that UK and European sales recovered strongly with 25% constant currency sales growth.

This helped reported EBITDA increase by 56% to $340.7 million and net profit after tax (NPAT) went up by 111% to $188.2 million.

The ASX 200 share's board declared a final dividend of 7 cents per share. That brought the FY21 dividend to 13 cents per share, up from 7 cents per share last year.

In July 2021, the first month of FY22, it saw sales growth in all three regions, with reported net sales up 9% overall. These trends have "continued broadly" in August.

It said underlying demand remains strong, but sales are being constrained by ongoing supply chain disruption including raw materials availability, shipping delays and a shortage of labour in plumbing trades.

Motley Fool contributor 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 and has recommended Reliance Worldwide Corporation Limited. The Motley Fool Australia has recommended NIB Holdings Limited, Reliance Worldwide Corporation Limited, and Sonic Healthcare 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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