Australia and New Zealand Banking Group
(ASX:ANZ) says it is on track to match its 2008 profit of $3.3 billion on strong revenue growth.
The bank says underlying profit after tax is tracking slightly above the comparable period in 2008.
In an update to the market the bank says strong income trends have continued driven largely by the performance of the institutional division, but charges for bad loans was weighing on profitability.
ANZ says that there has been a three-fold increase in its bad loans charge over the level recorded in 2008.
Impaired loans and derivatives were up 7 per cent for the June quarter, a slower rate of increase than in the previous two quarters.
The company says that its total provision charge is tracking slightly better than expected, however it expects the second half figure to be around $1.72 billion for the year.
ANZ says the increase in second half provisions has been driven entirely by its New Zealand business.
ANZ CEO Mike Smith says in Australia and in Asia, the economies are showing early positive signs of recovery and although the cycle is still playing out, there are reasons for cautious optimism.
Mr Smith says in New Zealand, economic conditions remain difficult with the recovery likely to be much slower. ANZ recorded net profit of $3.3 billion in 2008, down from its high of $4.2 billion in 2007.
Resource company Felix Resources Ltd (ASX:FLX) has reported a 42 per cent increase in net profit for the year.
Net profit for the year to June 30 came to $267.6 million, up from $188.5 million the year before.
The company says attributable sales tonnage rose 3 per cent to 4.77 million tonnes over the fiscal 2008 tonnage.
Felix says all of its mines performed to expectation during the year.
The company says it is in good shape going into 2010 and is basically in a sold out position until mid 2010 provided there is no more global financial shocks which may cause a slowdown like that suffered in late 2008.
Felix Resources recently received a $3 billion takeover offer from China’s Yanzhou Coal Mining, which it says the board will unanimously recommend.
Felix declared a final dividend of 50 cents a share. Felix Resources profits have increased each year for the past four years.
Paper manufacturer PaperlinX Ltd (ASX:PPX) has posted a big $798.2 million loss for the year and will not pay a final dividend as a result of unprecedented deterioration in global paper demand.
The loss compares to a profit of $72.2 million in fiscal 2008.
The result was impacted by $727.9 million in significant items, including impairment charges and a loss on the sale of its Australian paper business.
CEO Tom Park says this has been an extremely difficult year, with paper demand in all markets severely depressed by the global recession.
An unprecedented deterioration in global paper demand reduced volumes in the company’s key markets by 15-20 per cent in the second half.
Mr Park says while the first half of 2010 will remain tough coming off a weak second half of 2009, it will see the net benefits from cost reductions already made. The improving consumer and economic sentiment seen in the company’s major markets has yet to be reflected in a lift in demand in these markets. Looking back over the past five years, PaperlinX has posted inconsistent net profits.
