Here’s a roundup of some of the results from big companies from the last week.
BHP Group (LSE: BHP) announced that higher iron ore and copper prices had helped it to post a rise of 29% in underlying profits from continuing operations to $5.2bn. BHP’s revenue increased by 7% to $22.3bn on the back of a 40% rise in iron ore sales. Free cash flow rose 4% to $3.7bn and net debt is now at $12.8bn.
HSBC (LSE: HSBA) HSBC reported a 33% fall in profit before tax to $13.35 billion dollars (£10.2 billion). Alongside this was the news it plans to cut 35,000 jobs – a far bigger cut than had been anticipated. The company warned the outbreak of coronavirus had caused “significant disruption” for its business, especially in Asia and although it’s headquartered in London, almost half its revenue and nearly 90% of profit came from Asia in 2018. The move comes as HSBC plans to slash more than $100 billion (£77 billion) from the bank’s risk-weighted assets.
BAE Systems (LSE: BA) has been doing well from increasing US defence spending under Donald Trump. Underlying sales rose 7% to £20.1bn, while underlying EBITDA increased by 5% to £2.1bn, although £50m of that gain comes from a change in accounting setup. The group hiked its dividends by 4.5% over the previous year making the total payout for the year 23.2p. Net debt fell to £743m, the previous year, 2018, it was £904m.
Lloyds (LSE: LLOY) was once again buffeted by PPI costs which hit profits. The optimistic outlook though was enough to send the shares higher. It posted a 26% drop in pre-tax profits to £4.39bn for 2019.The bank said it had reached a settlement over the mis-selling of payment protection insurance. This was included in the £2.5bn set aside by the bank for the issue. Bad loans rise 38% during the year to £1.3bn largely the result of two large commercial customers and also due to weakening used car prices.
Pearson (LSE: PSON) saw underlying revenues for the year come in flat at $3.9bn. The problems with North American courseware were once again a detractor from the group’s results. Revenue and profits in the North American division both fell 3%. Free cash flow halved to £213m and debt jumped to just over £1bn (£809m the previous year).
Companies reporting in the week from the 24th February include Petrofac, Rio Tinto, Taylor Wimpey, William Hill, British American Tobacco, Mondi, WPP and many more. It’s going to be a massive week for full year results.
Please note I hold shares in HSBC.