New customers lift Amaysim’s earnings

Budget mobile provider Amaysim has delivered strong first-half earnings growth, underpinned by 59,000 new customers and tight cost control.

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First-half underlying earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 38 per cent to $17.3 million.

Revenue rose 16.5 per cent to $136.6 million, also bolstered by the acquisition of virtual mobile network operator Vaya, which had 140,000 customers when it was bought in January 2016.

Amaysim boasted 1.03 million mobile customers at the end of December, up from 764,000 some 12 months earlier.

Average revenue per user (APRU) – a key performance measure for the telecom industry – dropped 15 per cent to $22.37 as the group “consciously repositioned”, chief executive Julian Ogrin said.

The churn rate – the number of customers leaving the group – fell to two per cent in the first half, compared to three per cent a year earlier.

The company expects full-year underlying EBITDA of between $40 million and $42 million.

Amaysim expects to enter the broadband market, which is dominated by Telstra, TPG Telecom and Optus, in May or June following its acquisition of Australian Broadband Services last year, Mr Ogrin told AAP.

Initially, the group will focus on its mobile subscribers, or 600,000-plus households that have access to the national broadband network, Mr Ogrin said.

“We are excited about the opportunity in front of us to leverage our loyal subscriber base and our technology platform with our entry into broadband,” he said.

The national broadband network will be half complete by the middle of 2017.

Underlying operating costs were steady at $23.2 million in the first-half to December 31 on the back of lower marketing and acquisition expenses.

First-half net profit surged to $8.3 million from $681,000 a year earlier, which was hurt by IPO costs of $8.3 million.

Amaysim shares closed down six cents at $1.795.

AMAYSIM FIRST-HALF NET PROFIT SURGES

* Net profit $8.3m vs $681,000 in pcp

* Revenue up 16.5pct to $136.6m

* Interim dividend up one cent to four cents, unfranked

Iraqi troops take IS by surprise in Mosul attack

Tired and frightened, but free.

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Thousands of families with bags of possessions have successfully fled western Mosul as Iraqi forces try to take back the city from I-S, or ISIS.

Men are undergoing security checks to prevent I-S militants from slipping into government-held areas.

Families then board buses waiting to take them to camps for internally displaced people.

The head of Oxfam’s emergency team in Iraq, Tom Robinson, says it is a desperate situation.

His team is currently helping 4,000 people coming out of south-western Mosul, half of them children.

“So we’re focusing on emergency support at the moment, which is basically bottled water, blankets, heaters, the kind of basic provisions that families require if they come out of Mosul. So very, very sort of first-time response at the moment. Obviously, they’ve lived under ISIS for two-and-a-half years — the city itself has been surrounded. They’re living in very, very impoverished conditions. There’s a complete lack of services within Mosul.”

Many people are being treated for trauma after having to flee through battlelines.

One displaced man from Mosul, Ahmed Hussein, says his family has not eaten in days under I-S control.

“They have destroyed us in the week since the Iraqi forces started their advance. There is no water, no food, no bread, nothing. We are free — our families are over there ahead of us, and we are here. (But) look at this woman, she’s done. Look at her, she’s done. Blood pressure is up, sugar is down. What can I say? We got out of the land of infidels. Truthfully, it’s the land of infidels.”

Several dozen civilians forced by I-S fighters to leave villages south of Mosul and walk alongside them as they retreated towards the city have also been released.

Army, police and the elite Counter Terrorism Service forces are charging into western Mosul, with air and artillery support from the United States-led coalition.

US advisers are operating close to the front lines to direct air strikes.

The Iraqi military says it has overcome a number of suicide car bombs to take control of the two most recent neighbourhoods.

Rapid Response Unit officer Colonel Falah Al-Wazan says the military again took I-S, also known as Daesh,

“We entered al-Josaq district, which is considered the first line of defence for the city, and, after full liberation, you will see tunnels and trenches and earth banks built by the enemy in the area. Our forces were able to enter al-Josaq district at 0400 hours on foot and took the enemy by surprise. Some 40 to 50 Daesh members were killed in this district.”

Several thousand militants, including many who travelled from Western countries to join I-S, are believed to be holed up in the city with nowhere to retreat.

There are fears that could lead to a fierce standoff with 750,000 residents still trapped in their homes.

Iraqi troops captured eastern Mosul in January and began the offensive on the western side a week ago, retaking districts west of the Tigris River.

The area around Mosul is the last I-S stronghold in Iraq.

 

 

 

CIMIC circles as Macmahon results slide

Construction giant CIMIC has made its takeover offer for mining services company Macmahon Holdings unconditional after the target company’s board rejected the hostile bid.

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Macmahon’s board on Monday recommended that shareholders reject the 14.5 cents a share offer, calling it inadequate and opportunistic.

“CIMIC’s offer is inadequate and the independent expert has concluded it is neither fair nor reasonable,” the company said in a statement.

“The timing of the offer is opportunistic and doesn’t reflect the improved outlook for the mining services sector.”

CIMIC – which now owns a 23.3 per cent stake in Macmahon – tabled the bid in January, a month after wrapping up its $524 million acquisition of engineering and maintenance firm UGL.

The offer represents a 32 per cent premium on Macmahon’s stock price prior to the bid, and values the company at $174 million.

Macmahon manages mines for some of the world’s biggest mining companies, including Rio Tinto and AngloGold Ashanti, but has been hit by the prolonged downturn in the sector.

CIMIC, majority-owned by Spain’s ACS Group, has flagged an overhaul of the target’s operations should it secure control of the 54-year-old Perth-based company.

It plans to delist Macmahon after acquisition.

Macmahon on Monday reported a first-half loss of $23.3 million, down from a $3.3 million profit a year earlier.

Revenue was up 7.4 per cent to $168.3 million.

The group, however, indicated a turnaround on the back of recovering commodity prices, forecasting positive earnings for the second half of the financial year.

Second biggest shareholder Forager Funds Management, which holds 7.7 per cent stake, has previously rejected CIMIC’s offer, saying it undervalued the mining services company.

At 1525 AEDT, Macmahon shares were unchanged at 15 cents, while CIMIC shares were down eight cents at $37.73 in a weak Australian market.

MACMAHON SLIPS TO HALF-YEAR LOSS

* Net loss $23.3m vs $3.3m profit

* Revenue up 7.4pct to $168.3m

* No interim dividend, unchanged.

Turnaround focus after Bellamy’s rebellion

Infant formula supplier Bellamy’s is in uncharted territory after a shareholder protest vote removed most of its board to leave it with just three directors and no chairman, as a new challenge in its key China market emerged.

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Investors have shown support for the embattled company, however, lifting shares in the wake of Tuesday’s extraordinary general meeting where shareholders put a broom through the boardroom.

Rebel shareholder Jan Cameron, who led the protest against Bellamy’s ahead of Tuesday’s extraordinary general meeting, missed in her bid for a board seat but two of her aligned director candidates succeeded.

Tasmania-based Bellamy’s has endured a massive plunge in share price and faces a shareholder class action after it flagged a significant drop in sales in China and twice downgraded its full-year earnings forecast.

Bellamy’s chairman Rob Woolley and director Launa Inman resigned just before the shareholder meeting in Melbourne and shareholders subsequently dumped directors Michael Wadley – who briefly acted as interim chairman – and Charles Sitch.

Director Patria Mann was the only incumbent to survive the cleanout.

Kathmandu founder Ms Cameron was among three new directors proposed by Bellamy’s largest shareholder, Black Prince Private Foundation – which is linked to the entrepreneur.

While her bid failed, two other Black Prince nominees – lawyer Rodd Peters and Chan Wan-Chai – were successful.

Black Prince, whose sole purpose is to invest money to support charity work, funds the Elsie Cameron Foundation of which Ms Cameron is a trustee.

The shareholder vote leaves Bellamy’s with a three-person board and no chairman, but former Virgin Australia director David Baxby has been touted as a possible appointment.

Amid Tuesday’s corporate upheaval, Bellamy’s also announced it may have to seek new registration for its infant formula products with the China Food and Drug Administration.

The Chinese government has said that from January 1, 2018 CFDA registration will be required for overseas-produced infant formula products sold in China.

Shares in Bellamy’s lifted after coming out of a trading halt in the wake of the shareholder meeting and closed 18 cents, or 4.2 per cent higher at $4.45 .

Ms Cameron told shareholders during the meeting on Tuesday that the the Black Prince nominees have a plan for Bellamy’s but the question of a turnaround is very complex.

“We don’t have all the information at the moment,” Ms Cameron said.

I’ve just spent a couple of weeks up in China and there are indeed a lot of problems with distribution and pricing in China, and that’s where we would first tackle the problem.”

Rodd Peters told shareholders that Bellamy’s had been failed by its board, and the company now has to navigate a range of upcoming difficult legal and commercial issues.

Morgans analyst Belinda Moore said it is going to take time to turn around Bellamy’s but there were positive signs in the 18-month recovery plan outlined by acting chief executive Andew Cohen on February 24, when Bellamy’s unveiled a 47 per cent fall in half-year profit to $7.2 million.

“Everyone needs to get on with business and turn around this business because it is a very strong underlying brand,” Ms Moore said.

“They just need to get through some short-term challenges.”