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Woodside Petroleum Limited (WPL) said that the costs of Pluto project has blown out by between 6% and 10% from the $11.2 billion cost anticipated when the project was approved in July 2007. The increase in cost was due to lower than budgeted productivity in onshore and offshore construction. The project was still on track to deliver its first natural gas in early 2011 the company added.

Bow Energy Limited (BOW) announced a further reserve upgrade of 454 petajoules (PJ) for its Blackwater CSG field in Central Queensland, increasing Bow’s total net 3P Reserves to 1,447 PJ. The company said Independent consultants certified 1,340PJ of 3P gas reserves within the Blackwater CSG field. 378 PJ of 2C resource has also been certified within the Rangal and Burngrove coal seams in the south eastern corner of the Blackwater CSG field. Bow said the upgrade from the Burngrove Coal Measures represents a 51% increase over the previous reserves certified for the Blackwater CSG field. The company said its current net 3P certified reserves now exceeds the company’s original end 2009 target of 750 PJ of 3P gas reserves by 93% and its end 2010 target of 850 PJ of 3P gas reserves for the Blackwater CSG field by 58% over twelve months ahead of schedule.

Integra Mining Limited (IGR) said it has accepted an offer of finance for the Randalls Gold Project from joint lenders BNP Paribas and Westpac Banking Corporation (WBC). Integra said the offer of finance for construction and development of the project includes a senior debt facility of $45 million, a cost overrun facility of $5 million and a performance bond facility of $5 million.

Arrow Energy Limited (AOE) said, in regards to its FY10 outlook, it would focus its efforts on an enhanced exploration and appraisal program and the targeted FID on the Fisherman’s Landing project in March 2010. The company added that it expected continued increases in gas production and electricity sales during the year.

Looking even further ahead, managing director and CEO, Nick Davies said the company forecast a 10-fold increase in net production over the next six years as Arrow continued to build its operations overseas and bring an estimated Australian gas resource of 74,000 petajoules (PJ) to market.

“Current global market conditions are challenging but the demand for gas remains strong,” Mr Davies said.

”Arrow is well positioned to build on the firm base that we have created and the partnerships that we have forged.”

In FY09 Arrow increased its gross proved and probable (2P) reserves by 186% to 4,092 PJ and said at its AGM it was investing $300 million in exploration and appraisal activities over the next 18 months.

”Our target is to increase gross 2P reserves by 1,000 PJ every year going forward,” Mr Davies said.

”Gross gas production is up 199% over the last three years and we estimate that by 2015 our net gas production will increase ten fold to 220 PJ a year from producing fields in Australia and Asia.”

Mr Davies also confirmed that Arrow and its joint venture partner Royal Dutch Shell are continuing to negotiate terms of gas supply to Shell’s proposed LNG facility on Curtis Island in Gladstone.

The company added that by 2015 it expects to be producing gas in Asia and undertaking extensive appraisal activities to prove up further reserves.

As at 1054 AEDT, Arrow Energy shares were down 8c to $4.14.

Sims Metal Management Limited (SGM) announced a proposal to raise about $400 million in capital via a fully underwritten placement. The metal recycler also said it planned to raise $75 million through a share purchase plan (“SPP”).

Sims said the purpose of the capital raising was to provide financial flexibility to pursue its growth agenda for both the Metal Recycling division and its Sims Recycling Solutions (“SRS”) business.

The company added that it is looking to continue its acquisition growth strategy as opportunities become available.

”The ability to move quickly and maintain a conservative financial profile is a significant competitive advantage in leading the consolidation of Sims Metal Management’s key markets,” Sims Metal said.

“The company also has a strong pipeline of value accretive capital expenditures, including the global roll-out of metal recovery technology and specific facility construction initiatives.”

The company said under the institutional placement shares would be offered at $21.00 each, or a 5.4% discount to the last closing price on 19 November 2009.

Under the SPP the issue price of shares would be the lower of the institutional placement price and the 5-day volume weighted average price of shares traded on the Australian Securities Exchange up to and including the last day of the offer period.

Sims Metal said it intends to roll-out globally third generation downstream shredder technology to facilitate greater recovery of valuable non-ferrous metals and reduce waste going to landfill, while the company is also continuing to organically strengthen its core businesses of Metal Recycling and SRS.

CEO, Dan Dienst, said recent acquisitions have been integrated effectively and are performing well under the circumstances.

“The specific technology efficiency opportunities identified are expected to yield returns materially in excess of the cost of funding,” Mr Dienst said.

“Looking to the future, through the capital raising, the Company will be in an enviable position to strengthen its existing business and fund acquisition growth opportunities, which will enhance and expand its industry leading position.”

The company said initially, proceeds of the equity raising would be used to repay debt.

Sims Metal Management shares were halted at $22.20.

Adelaide Brighton Limited (ABC) said at this morning’s AGM that net profit after tax guidance for the year ended 31 December 2009 would be in the range of $105 million - $115 million, in line with previous forecasts. The cement manufacturer reported a net profit for the previous corresponding period of $120.8 million.

Meanwhile, at the end of this year the company said that its debt level would be around $225 million, with gearing reduced to less than 25% following a successful capital raising earlier in the year.

The company said the strengthening Aussie dollar would be beneficial for second half import costs, however it could also limit potential for future upside in domestic prices, and apply pressure on cement pricing in some regions.

The company said that ‘profit optimisation’ strategies employed by the company had secured an extra $15 million in EBIT.

At 1022 AEDT, Adelaide Brighton shares were down 3c to $2.65.

Australia and New Zealand Banking Group Limited (ANZ) announced it has agreed to sell its Custodian Services business in Australia and New Zealand to J.P. Morgan. ANZ said the transaction continues the process of refocusing ANZ’s Institutional business on its core banking priorities in Australia, New Zealand and Asia. The company added that J.P. Morgan Worldwide Securities Services is ideally placed to service Custodian’s clients with its comprehensive suite of custody and securities products and solutions. ANZ said the transaction is expected to be complete before the end of CY09, subject to regulatory approvals, and would be followed by the progressive transfer of business and staff within 2010.

National Hire Group Limited (NHR) said it expects that NPAT for the first half of the 2010 financial year will be in the range of $2 million to $5 million compared with $15.3 million the first half of the 2009 financial year. This estimate remains subject to completion of asset sales in Coates Hire in line with current expectations, audit review of the first half financial statements and reasonable trading conditions for the balance of the period.

A strengthening greenback and concerns regarding an economic recovery saw Wall Street lose ground for the second consecutive day. Most sectors fell victim to the sell-off, with tech stocks leading the slide.

In employment news, the Labor Department’s weekly report revealed initial jobless claims were unchanged from the previous week. Jobless claims totalled 505,000.

The Dow Jones lost 93.87 points, or 0.9%, to 10,332.44, the S&P 500 slid 14.90 points, or 1.34%, to 1,094.90 and the NASDAQ fell 36.32 points, or 1.66%, to 2,156.82.

Tech stocks struggled on the back of bearish earnings outlooks and broker downgrades. Apple and Microsoft shed 2.7% and 1.1%.

Yahoo! and Oracle lost 2.3% and 1.8%, while Intel dropped 4.1%.

Financials were also entrenched in the red. Goldman Sachs shed 2.3% as Bank of America and Wells Fargo slid 1.7% and 1.9%.

Morgan Stanley dropped 3.1%, while JPMorgan lost 1.9% after announcing it would acquire the half of UK broker Cazenove that it does not already own.

Sears shed 3.7% despite the retailer reporting a better than expected quarterly loss.  Macy’s dipped 1.6%, while sector heavyweight Wal-Mart put on 0.7%.

Dow components Aluminium producer Alcoa and machinery manufacturer Caterpillar lost 3.9% and 1.4%.

Energy majors Chevron, ConocoPhillips and Exxon Mobil fell 2%, 1.9% and 0.8% respectively.

NYMEX light crude oil for December delivery weakened US$2.12 to settle at US$77.46 a barrel.

COMEX gold for December delivery gained US60c to a record close of US$1,141.30 per ounce.  

European Markets

European stocks had their worst session this month as falling commodity prices placed pressure on related stocks. Investors booked profits with losses focussed on the banks and the miners.

The UK benchmark FTSE 100 shed 74.43 points, or 1.39% to 5,267.70. The French CAC40 lost 67.94 points, or 1.77% to 3,760.22, while the German DAX fell 85.43 points, or 1.48% to 5,702.18.

Financials were heavily sold. In the UK Barclays and HSBC slid 2.8% and 1.3%, while Germany’s Deutsche Bank and Commerzbank lost 2.5% and 2.9%.

Credit Agricole fell 2.8% as France’s largest two lenders BNP Paribas and Societe Generale shed 1.1% each.

Insurers AXA and Aviva dropped 2.3% and 2%.

Technology stocks weakened after BofA Merrill Lynch cut its 2010 growth outlook for the global semiconductor industry. Alcatel-Lucent and Infineon sank 3.7% and 7.2%.

Groupe Danone fell 4.4% after the yoghurt maker decreased its medium-term revenue growth target.

A drop in metals prices sent miners lower. Antofagasta, Xstrata and Anglo American dropped 5.4%, 5.1% and 3.9% respectively.

Aussie peers BHP Billiton and Rio Tinto shed 2.8% and 3.8%.

Energy stocks tracked the price of crude lower. Royal Dutch Shell, BP and Total lost 1.7%, 1.3% and 1.1%.

Japanese Markets

Japan’s Nikkei dropped as the nation’s largest bank Mitsubishi UFJ Financial announced a capital raising. A strengthening yen saw exporters weaken.

The Nikkei 225 fell 127.33, or 1.32% to 9,549.47.

Mitsubishi UFJ Financial shed 3.7% after announcing it would raise US$11 billion. The announcement raised concerns of further equity raisings within the financial sector.

Mizuho Financial Group and Sumitomo Mitsui Financial Group slumped 6.6% and 4.6%.

Brokerage Nomura Holdings fell 4.9%.

Nomura Real Estate slumped 8.6% as it prepares to raise capital.

Automakers Toyota and Honda lost 1.7% and 3.5, while Canon and Sony slid 3.2% and 2.2%.

Mitsui Chemicals dropped 7.1% on reports the company’s taxes may increase.

Hong Kong Markets

The Hong Kong market gave up ground as investors locked in profits on an index which has doubled in value in 8 months. Banks were out of favour, while the retailers also slumped with poor economic data out of the US continuing to keep investors nervous.

The Hang Seng slumped 197.17, or 0.86% to 22,643.16.

In a wrap-up of the banks, Bank of China retreated 2.1%.

Bank of Communications and ICBC both lost 1.1%, while HSBC, which makes up one-sixth of the market, gave up 1%.

Making ground for the day was China Mobile, which added 1.1% after saying its business was similar now to pre-crisis levels.

Among the shippers, China Cosco put on 1.1%, while Pacific Basin Shipping added 3.5%.

Third party mobile phone maker, Foxconn International lost 2.8%, while Li & Fung, which makes clothes for Wal-Mart, retreated 2.5% on worries about the US economy. 

Directors' Interest Notices
19 November 09

Symbol	Shareholder	+/-	Prior	Now
AWB	Gordon Davis		20,000	40,000*
AWB	Fred Grimwade		50,000	100,000*
AWB	Tony Howarth		31,587	63,174*
AWB	Peter Polson		15,000	30,000*
AWB	John Schmoll		17,500	35,000*
OSH	John Stitt		9,600	39,600
SIP	Brian Jamieson		177,229	181,900^
SIP	Linda Bardo Nicholls		360,554	372,426^
SIP	William James Scott		6,245,240	6,247,850^
SIP	David Bayes		68,479	70,734^

* Participation in 1-for-1 Entitlement Offer
^ Dividend Reinvesment Plan

 

Substantial Shareholder Changes 
19 November 09

Symbol	Shareholder	+/-	Prior	Now
BKN	Paradice Investment Mgt. P/L		-	5.12
CAB	National Australia Bank		5.10	-
CRG	Schroder Investment Mgt. Aust.		5.43	7.23
IGO	Orion Asset Mgt. Limited		5.19	6.24
PBG	Bank of America Corporation		-	5.00
PRY	Perpetual Limited		8.57	10.16
VBA	Paradice Investment Mgt. P/L		-	5.31

All movements are percentage changes

Australia’s two major indices closed slightly higher Thursday as the majority of sectors closed within 1% either side of the gain line. The big four banks recovered some of their recent losses, while consumer related stocks fell out of favour.

According to Reserve Bank of Australia figures, $19.25 billion was spent on credit and charge cards in September, up from $18.87 billion the previous month.

At the end of the day, the All Ords had gained 8.2 to 4,767.8, while the ASX/200 rose 10.2 to 4,749.2. About 2.5 billion shares worth around $4.3 billion had changed hands. 

The Banks and Financials sector put on 0.6%.

The big four banks posted gains, with NAB and CBA the best performers having rallied 1.4% and 1.6% to $29.00 and $53.14 respectively.

The insurers showed more volatility throughout the day. IAG, the source of takeover speculation, climbed 19c to $4.20, while QBE lost 41c to $22.60.

Property Trusts were mainly higher, with Westfield leading the sector 0.5% into the black, gaining 1.6% to $12.73.

Mirvac lost 3c to $1.545, despite reaffirming guidance of a 20% increase in profit to $250 million this financial year.

Goodman Group put on 2.4% to 63c, while Stockland fell 1.5% to $4.07.

Among the heavyweight miners, BHP Billiton added 17c, or 0.4% to $40.77, while Rio Tinto was flat at $72.60. Reports surfaced suggesting Rio Tinto was not too keen to pursue the Pilbara joint venture with BHP.

The Materials and Resources sector put on 0.4%.

The gold miners benefited from the rise in the price of gold. Newcrest added 55c to $36.01.

Aquarius Platinum jumped 42c, or 7.2% to $6.28. 
 
The Energy sector was 0.1% lower despite a 1.2% gain to $50.10 from Woodside and Oil Search adding 7c to $5.92.

Origin countered, losing 19c, or 1.2% to $16.06, while Paladin and Felix slumped over 3.5% each.

Industrials finished 0.2% lower. 

Brambles added 4c to $6.76 as the company reported a 3% drop in sales for the four months to 31 October 2009 compared to the previous corresponding period. 

Leighton gained 7c to $37.21.

Toll rose 12c to $8.29, while airliner Qantas shed 2c to $2.71.

Among Consumer Staples, Wesfarmers and Woolworths lost 20c and 12c to $29.19 and $28.30 respectively.

Meanwhile, a 0.9% gain to $10.63 from Coca-Cola was more than offset by Foster’s, which fell 2.3% to $5.57.

The sector weakened 0.6%.

The Consumer Discretionary sector was trading 0.9% lower, with retailers losing ground on a report by the National Retailers Association that more than one-third of shoppers were planning to cut back on Christmas spending.

JB Hi-Fi was off 46c to $22.50, while Billabong sank 20c to $10.15.

Among media stocks, Fairfax shed 3.5c to $1.695, while Newscorp eased 8c, or 0.5% lower to $15.86. Both publishers have expressed an interest in charging for online content, with the contention being how and not if.

Among Healthcare stocks, Sonic Healthcare edged 2c higher to $14.20 after reaffirming profit guidance. Larger rival CSL advanced 1c to $31.77. The sector was flat.

Telstra lost 1c to trade at $3.31. The broader Telecommunications was 0.2% below the line.

Around the region, the Nikkei 225 lost 174.5 to 9,502.3, while the Straits Times Index added 27.5 to 2,772.5. Across the Tasman, the NZSE50 put on 12.8 to 3,141.2. The Hang Seng dropped 121.2 to 22,719.2.

Spot gold was trading at US$1,141.12 per ounce, and the Aussie was buying US$0.9235. 

---

Iluka's Jacinth-Ambrosia ahead of schedule
Iluka Resources said its Jacinth-Ambrosia project has completed first production of heavy mineral concentrate ahead of schedule. The company said capital expenditure is expected to be less than $390 million, compared with an approved budget of $420 million.

At the end of the day, Iluka shares were unchanged at $3.40.

Brambles sales down 3% to start FY10
Brambles said that, in the four months to 31 October 2009, the company posted sales revenue of $1.4 billion, down 3% from the previous corresponding period.

By the finish, Brambles shares were up 4c at $6.76.

Monadelphous wins $60m contract
Monadelphous Group said it has been awarded a $60m contract associated with the construction of the Gorgon Project on Barrow Island in Western Australia. The company said the initial term of the facilities management services contract is for three years, with the option for two further one-year extensions.

At the end, Monadelphous shares were down 2c to $13.43.

St Barbara sees growth ahead
St Barbara, at its Annual General Meeting, said that the future growth for the company would be underpinned by company’s Gwalia mine, near the town of Leonora in Western Australia. The company is developing the mine to gain access to deeper parts of the orebody and said it was on track to achieve forecast guidance of between 205,000 and 240,000 ounces of gold in the current financial year.

At the end of the day, St Barbara shares were up 0.5c to 35.5c.

Mirvac reaffirms profit guidance
Mirvac Group reiterated its FY10 profit guidance at its annual general meeting today. The group said it expects to report a profit of $253 million, an increase on the $200.8 million profit posted in FY09.

By the final whistle, Mirvac shares were down 2.5c to $1.55.

F&P post record profit
Fisher & Paykel Healthcare Corporation announced a record profit of NZ$37m for the six months ended 30 September 2009, 31% above the previous corresponding period. The company attributed the strong performance to very strong revenue growth in its obstructive sleep apnea product group, continuing strong demand for its respiratory products and favourable foreign exchange hedging results.

By the close, Fisher & Paykel shares were up 10c at $2.43.

Hastie acquires two businesses
Hastie Group announced the acquisitions of the North Queensland based James + More and Tweed Heads based Cool-it. The building services and refrigeration systems group said the combined revenue of the businesses is about $35 million.

At the end of the day, Hastie shares were up 1.5c at $1.865.

Iluka Resources Limited (ILU) said its Jacinth-Ambrosia project has completed first production of heavy mineral concentrate ahead of schedule. The company said capital expenditure is expected to be less than $390 million, compared with an approved budget of $420 million.

Iluka said completion of the project brings into production a long life, globally significant, zircon rich mineral sands mine and, in combination with the completion of the Murray Basin Stage 2 project in Victoria, sees the conclusion of Iluka’s current major project execution and capital expenditure programme.

Managing director, David Robb, said the achievement significantly reduces risks associated with both project execution and balance sheet capacity for the company.

“At the same time, completion of both projects consolidates Iluka’s position as not only a major supplier of titanium dioxide feedstocks internationally but also as the principal supplier of zircon, the medium term demand characteristics for both of which are positive, especially in developing and urbanising economies,” Mr Robb said.

The company said the unique characteristic of the South Australian project is its combination of size and high zircon assemblage, with the deposits together having a combined zircon assemblage of 50%.

Iluka expects the project to produce approximately 2.8 million tonnes of zircon, 350 thousand tonnes of rutile and 1.5 million tonnes of ilmenite over its ten-year plus economic life.

As at 1437 AEDT, Iluka shares were unchanged at $3.40.