BT Investment Management Ltd
BTT Dividend Details
Record Performance for the year: BT Investment Management Ltd (ASX: BTT) announced its record result of cash net profit after tax of $132.5 million which surged by 4% over prior corresponding period. Cash earnings also went up 3% to 44 cents. The Company reported a 6% surge in total dividends up to 37.0 cents per share. Further, 28% rise in base management fees was another highlight. The company delivered about 493% total shareholder return on a three-year basis. Funds under management rose to over $78 billion, which is indicative of $12 billion rise over the year partly owing to lower Australian dollar. However, we did note that total funds under management fell to $78.4 billion as at September 2015, as compared to $78.9 billion in June 2015. Meanwhile, the group recently extended the Master relationship agreement (MRA) with Westpac owned BT Financial group. On the other hand, MRA related funds under management reached $17 billion as at September 30, 2015, while the effective management fee for FUM declined from 32 basis points to 29 basis points translating into a loss of $5.1 million in terms of revenue. BT Investment Management reported a weak financial performance with performance fees falling to $38 million in the six months ended on March 2015 as compared to $114.7 million in pcp.
Results for year ending 30 September 2015 (Source: Company Reports)
The shares of BTT already delivered outstanding performance of generating over 53.86% during the year to date (as at 28 Oct, 2015), due to which the stock is trading at expensive valuations, with P/E trading higher at over 25x which is a little above most of the peers. Accordingly, we give an “Expensive” recommendation to the stock at the current price of $11.35
Sonic Healthcare Limited
SHL Dividend Details
Focusing on international business: Sonic Healthcare Limited (ASX: SHL) reported an overall revenue growth of 7.3% year on year (yoy) to $4,201 million in fiscal year of 2015, boosted by synergies from the group’s acquisitions along with enhanced performance in US, Germany, UK and Switzerland regions despite tough Australian laboratory market conditions. The group’s US business improved on the back of the restructure of CBLPath from which SHL achieved a recurring annual savings of greater than US$10 million. European business revenues surged by 25% yoy, driven by three months contribution of joint venture with UCLH and Royal Free coupled with solid private market growth. The group estimates an ongoing growth of its UK revenues and accordingly projects a 40% revenue increase during FY16. There are market speculations about SHL’s interest in bidding for Unilabs SA (Swiss Diagnostics Company) wherein the deal is expected to be worth €1.5 billion.
International business growth (Source: Company reports)
However, the shares of SHL corrected over 6.27% (as of Oct 28, 2015) in the last three months as the group decreased its profit guidance before the release of its full year results. Moreover, SHL’s net profit fell more than estimated by 5.6% yoy to $363 million affected by the Australian collection infrastructure costs. The group also incurred a Non-recurring costs of over $14 million due to CBLPath restructure costs, New Zealand contract exit costs as well as acquisition costs. SHL shares are also trading at higher P/E of 21.15x. It is yet to be seen that how the Australian government’s review of the Medical Benefits Scheme for examining the merits of 5,700 subsidized items affects Sonic Healthcare. Given the overall scenario, we maintain our “Expensive” recommendation to the stock and would review the stock at a later date.
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