The June 30 reporting season moves past the half-way mark this week with major results from BHP, Woolworths, Qantas, South32 and Fortescue to dominate.
Seventy companies in the ASX 200 – 35% of the index, are due to report.
The AMP’s Chief Economist, Dr Shane Oliver wrote at the weekend that “2017-18 earnings growth are on track to come in around 9%, with resources earnings up 25% thanks to solid commodity prices and rising volumes and the rest of the market seeing profit growth of around 5%". Dividend growth will likely be solid, he added.
They include Woolworths, Ansell, Cardno,Fortescue and Primary Health Care later today, Amcor, Oil Search, Healthscope, Super Retail Group, Monadelphous, Seven West Media, and BHP tomorrow, Bapcor, Greencross, Inghams, Lovisa, Newcrest Mining, The Reject Shop, Southern Cross, Seven Group, Worley Parsons and Coca-Cola Amatil (interim) on Wednesday, Alumina, AP Eagers, Bega Cheese, BWX, Flight Centre, Stockland, Santos (interim), Qube, Northern Star Resources, Qantas, South32 and Nine (Thursday) and Brambles, Steadfast, Mayne Pharma, Costa Group, Star Group and MYOB (Friday).
Dr Shane Oliver said that around 35% of the major companies have reported “and so far so good. 48% of results have surprised on the upside compared to a norm of 44%, the breadth of profit increases is high with 83% reporting higher profits than a year ago compared to a norm of 66%, 89% have increased their dividends or held them constant and 64% of companies have seen their share price outperform the market on the day results were released.”
But he warned that the quality of earnings usually starts weakening in the final weeks of the season, writing at the weekend “its often the case that the quality of results tails off in the last two weeks of the reporting season so don’t get too excited just yet."
Source: AMP Capital