Hello and thanks for tuning in to Kalkine TV, I’m James Preston and this is The Stocks in
Action show. In today’s show, we will take a look at the latest updates from CIMIC Group,
Ampol, Downer EDI and more. Let’s begin with taking a look at capital goods firm CIMIC Group.
CIMIC Group informed on 11 October 2021 that it’s energy subsidiary UGL has been awarded contracts
in the resources and utilities sectors with a total revenue of $135 million aussie dollars.
Under the contracts, UGL will provide maintenance, projects and turnaround services for existing
client, Viva Energy, in Victoria over a two-year period; and design and construct two greenfield
switching stations and construct approximately 65 kilometres of 330 kilovolts transmission line
over 18 months for Powerlink. This will connect the MacIntyre Precinct in Southwest Queensland
to the transmission network. CIMIC Group Executive Chairman and Chief Executive Officer
Juan Santamaria shared that, UGL having a national presence, provides specialised
engineering expertise to clients in the resources and utilities space. He also stated that the
Company will be again working with Viva Energy and Powerlink to support critical infrastructure
for communities across Australia. Both contracts are effective from October 2021. [w] On the ASX,
CIMIC Group was trading up at $20 aussie dollars and 43 cents per share in the morning. [e]
Turning our attention now to ASX-listed manufacturer of dairy products Keytone Dairy
Corporation who today has shared it’s unaudited results for the quarter ending on
September 30. The second quarter of financial year 2022 results announced by the Company revealed,
a strong consolidated sale of $15 million aussie dollars, growing more than 10% compared with the
corresponding quarter in financial year 2021. Moreover, the month of September 2021 realised a
record consolidated sales high of AU$5.7 million, implying a material increase on the annualised run
rate compared with FY21 full year performance. Keytone Dairy also reported that while individual
proprietary brand sales in the portfolio, such as Tonik have continued to grow,
consolidated Brands sales have softened compared with the prior corresponding period. This is
primarily due to the ongoing lockdowns across New South Wales and Victoria closing key distribution
channels and the previously announced delisting of Super Cubes Purees in Woolworths. The
Company has stated that it is witnessing strong sales momentum and demand from its
clients. Keytone Dairy expects the second half of financial year 2022 to be solid given the existing
sales pipeline and the key New South Wales and Victorian states emerging from prolonged
lockdowns. In addition, the Company has expressed confidence that the Brands business will bounce
back strongly in the second half as Australia is now emerging from COVID lockdowns.
And now, its time for a short break. Stay tuned for more trending updates.
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Hello and welcome back. James here live from Sydney. You are watching the stocks in
action show.
Moving on to the next company. Petroleum products company
Ampol has entered into a binding Scheme Implementation Agreement proposing to acquire
all the shares of Z Energy. Let us look at the Key Highlights. Z Energy shareholders will receive
a cash offer of NZ$3.78 per share and a first interim dividend of NZ$0.05 per share for the year
financial year 2022 making an overall value of NZ$3.83 per share. If the Scheme for acquisition
isn’t implemented by 31 March 2022, final cash consideration will be increased to reflect
financial year 2023 performance to a maximum of NZ$0.10 per share. Z Energy board has given a
unanimous recommendation to shareholders to vote in favour of the acquisition scheme, subject to
consideration being in or above valuation range and in the absence of a superior proposal.
The shareholder meeting to vote on the Scheme is expected to be held early in 2022.
The acquisition is also subject to various conditions and regulatory approvals from the
New Zealand Commerce Commission and New Zealand Overseas Investment Office. Today Z Energy shares
on ASX are trading over 5% up at AU$3.410 per share and Ampol shares at AU$30.360.
Next update to look at. ASX-listed insurance company Insurance Australia Group shared today
that it is reviewing a judgment coming from the Federal Court of Australia in the second
business interruption test case was handed down on Friday, 8 October 2021. IAG informed that the
Federal Court's judgement was found favouring insurers on many policies wording questions and
for policyholders on other questions. IAG further mentioned that the judgment was detailed. However,
comprehensive analysis is also required to assess the impact. IAG informed that it is reviewing the
judgment to determine whether to appeal any aspect of the judgment. The Company also aims to resolve
the issue as soon as possible for its customers with business interruption policies. Additionally,
the Federal Court has scheduled time in November 2021 to hear any appeal in
the Full Court of the Federal Court, as agreed as part of the test case process. Meanwhile, on
the ASX, the IAG stock was spotted trading 2.986% higher at AU$ 5.340 per share in the morning.
And last news to look at today is --- ASX-listed provider of engineering and infrastructure
management services Downer EDI announced on Monday that the Company has entered into an
agreement to sell its Open Cut Mining East business to an Australian subsidiary of PT
Bukit Makmur Mandiri Utama shortly known as BUMA. The announcement revealed that Downer
will receive approximately AU$150 million in cash proceeds from the transaction.
According to the announcement the Australian subsidiary has paid Downer EDI a deposit of
AU$16 million, the remaining amount will be paid at the completion of the deal. The
Company stated that transaction is slated to complete by the year end. Meanwhile the stock
Downer EDI was spotted trading at AU$6.670 per share, down 1.3% in the morning.
That’s a wrap in the show. Keep watching kalkine tv for more trending market updates.