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Why retail figures and Metcash profit disaster confirm retailers are still doing it tough

Posted on Jun 5, 2015

Today’s retail sales numbers were disappointing.  The figures, combined with Metcash profit disaster confirm that retailers are still doing it tough.

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Budget economic forecasts show Govt is hoping market forces will do ‘heavy lifting’: Pitcher Partners

Posted on May 13, 2015

The economic forecasts contained within tonight’s Federal Budget appear to be measured, with a GDP forecast of 2.75% for 2015-16.

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NAB focus is on long-term shareholder returns: Pitcher Partners

Posted on May 8, 2015

After a torrid week for bank investors, the market should be satisfied with the result that NAB has announced today.  Statutory net profit rose 20.4% to $3.44 billion, with the cash profit up a healthy 5.4% to $3.32 billion.

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Why timing is right for Mantra acquisition of Outrigger: Pitcher Partners’ David Lane

Posted on Mar 19, 2015

Outrigger Acquisition by Mantra Group (MTR), Thursday, 19 March 2015

Mantra Group (MTR) today announced the acquisition of Outrigger, together with an equity raising.

The timing of the acquisition is right, as there are signs of an improvement in domestic tourism as a result of the softer AUD.  Although trends are improving, property prices on the Gold and Sunshine Coasts are still relatively depressed compared to the recent hype in Sydney, Melbourne and Brisbane apartments.

The Outrigger properties are well located, and will complement Mantra’s existing portfolio of 113 properties.  It is likely that Mantra will be able achieve long-term cost savings through economies of scale and marketing opportunities with Outrigger becoming part of the larger group.

Encouragingly, Mantra management have chosen to fund the deal with an equity raising.  Although debt funding is cheap with low interest rates, it seems that REIT managers have learnt the lessons from the GFC of carrying too high debt levels.  Mantra group currently has net gearing of 30.6%, which is manageable.  Assuming the equity raising is successful, the balance sheet for the group will remain prudent.

Comment from David Lane, director of Wealth Management at Pitcher Partners 

RBA may stay the course with interest rates following release of FOMC notes in the US: Pitcher Partners’ David Lane

Posted on Mar 19, 2015

FOMC announcement, Thursday, 19 March 2015

The notes of the FOMC were released in the USA, with the key word “patient” being removed from their stance on interest rates.  As market participants had anticipated, this leaves the door open for a possible rise in US official rates in June.

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RBA leaves cash rate unchanged at 2.25%

Posted on Mar 3, 2015

As we had expected, the RBA has  decided to leave the official cash rate unchanged at 2.25%.  We believe that the RBA Board has decided to allow last month’s change sufficient time to work through the economy.

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What does Woolworths’ half-year result mean for shareholders?

Posted on Feb 27, 2015

While the food and liquor core of Woolworths’ business continued to record strong revenue and profit growth, it was once again the discretionary parts of the business that have struggled.  Masters recorded a $103 million loss for the half, while General Merchandise (Big W) profit fell 9% and Hotels declined 11.8%.

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Telstra providing strong returns for shareholders 

Posted on Feb 12, 2015

Telstra’s result this morning (Thursday, 12 February 2015) was an excellent result, with David Thodey and his management team proving that the transformation of Telstra is providing strong returns for shareholders.

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Why subdued retail growth in November is no surprise: RBA retail figures

Posted on Jan 9, 2015

RBA retail figures 9 Jan 2015: comment from David Lane, director of Wealth Management at Pitcher Partners

The ABS  this morning released Retail Trade figures for November, showing a subdued rise of 0.1% in November, with an annual trend rise of 4.5%.

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RBA’s housing lending pronouncement is sign of a job well done, 25 Sept 2014

Posted on Sep 26, 2014

While the potential of macroprudential controls, or more closer scrutiny of lending practices, would have an impact on the profit margins of the major banks, we are unconvinced that the RBA is likely to introduce such measures.  Rather, Glenn Stevens is sounding the warning to the banks that as property prices rise, so do the risks.  These risks are well known to Australia’s senior bankers.  Tighter controls and a robust banking system are the real reason that Australia fared better during the GFC than most northern hemisphere countries. Read More