2017 BRISBANE TOP COMPANIES 21-30
28 April 2017, Written by Ben Hall, David Simmons, Paris Faint, James Perkins
JEWELLERS Michael Hill International listed in 2016 with a half-billion dollar market capitalisation and a new CEO in Phil Taylor and they joined some other fast movers.
Pinnacle Investment Management Group also made a rapid rise while Superloop CEO Bevan Slattery's acquisition of telecommunications provider SubPartners is expected to keep it on track for continued growth.Vita Group's place in the top 30 will depend on how it can deal with the rumours of Telstra wanting to take back some of its profit-making stores.
21. CARDNO (CDD)
CEO: Neville Buch
AFTER posting two consecutive losses, including a $176 million full year loss for 2016, the first half of 2017 has been better for engineering consultancy Cardno which reported a profit of $6.5m.
This can be attributed to the Group's strong performance in the Asia Pacific region which contributed $142.1m to the company's $575.7m net revenue, which is up 7.6 per cent from the previous corresponding period.
The company's business in the Americas suffered somewhat comparatively, with the revenue from the region dipping 6.9 per cent which Cardno says is due to "challenges in the external market place".
Cardno's success this half may come as a result of the sale of their speciality software business XP Solutions for US$659m which was used to cover the company's debts.
22. OROCOBRE LIMITED (ORE)
2016 ranking: 19
CEO & MD: Richard Seville
MARKET prices resulted in a slight loss for lithium miner Orocobre during the first half, but the company still realised a profit of US$7.4m.
The cost of doing business in South America impacted the company slightly, with the devaluation of the Argentinian Peso impacting the profitability of the company during the period.
Production guidance for FY17 has also been revised down from 15,000 tonnes to between 12,000 and 12,500.
The Company's Joint Venture with TTC in northern Argentina is underway and is the first large scale "green fields" lithium brine development in approximately 20 years.
23. COLLINS FOODS (CKF)
CEO & MD: Graham Maxwell
Collins Foods continues its aggressive expansion into Europe and announced it had purchased 16 KFC restaurants in the Netherlands for $87.7 million from Yum! Brands.
That deal also includes plans to develop a further 20 new stores in the Netherlands with Yum! By 2021, and the Dutch deal follows on from Collins' purchase of 11 German KFC restaurants which is also an expansion target for Collins.
It mirrors the rapid European expansion being carried out by Domino's Pizza (ASX: DMP) and once again, Collins Foods' revenue was driven by the $249.6m KFC segment of the business but negatively affected by Sizzler restaurants which dropped 11.1 per cent in the period.
Total net profit rose 17.2 percent in the half year to October 2016, and revenue was up 4.7 per cent.
24. BLUE SKY ALTERNATIVE INVESTMENTS (BLA)
MD: Robert Shand
After booking a 130 per cent increase in half year profits to December 31, Blue Sky Alternative Investments' new managing director Rob Shand says this is "just the beginning" as momentum in the company's growth was only just starting to be realised.
The company's founder and talisman Mark Sowerby handed over to Shand in August after 10 years at the helm, saying it was simply time to hand over a well performing business to a highly capable new management team.
The company has $2.7 billion of assets under management, adding $1 billion over the calendar year, and expects to manage between $3.1 billion and $3.3 billion by the end of FY17.
Blue Sky have deployed capital alongside Goldman Sachs into student accommodation and invested in Aura Australian Holding Trust, the operator of a portfolio of retirement village assets being developed by Blue Sky. The student accommodation asset looks to yield investors around 10 per cent per annum.
Blue Sky's success has been driven by their focus on what they call "the essentials"; investing in things people need rather than what they want. This lead to a focus on investing in sectors like food, water, agriculture, healthcare, education, retirement, and technology.
25. MICHAEL HILL INTERNATIONAL LIMITED (MHJ)
CONSUMER DURABLES AND APPAREL
CEO: Phil Taylor
After an extensive international CEO search, Michael Hill International opted to promote from within and handed over to the experienced executive Phil Taylor following the departure of former boss Mike Parsell, who went on to join smaller rival Secrets.
Taylor, a 30-year employee of Michael Hill including 13 years as COO, worked with Parsell as they oversaw the company's massive expansion which resulted in their revenue growing from $8 million to $551 million at one stage.
The expansion resulted in 304 Michael Hill stores in Australia, New Zealand, Canada and the US, along with 24 Emma & Roe stores.
Despite tough trading conditions in the lead up to Christmas, the company booked a half year net profit increase of 3.4 percent to $25.8 million with revenue up by 5 per cent to $327 million.
The company began operations in New Zealand in 1979 and moved its head office to Brisbane by way of a listing with the ASX in July 2016.
26. SENEX ENERGY (SXY)
MD & CEO: Ian Davies
THE first half of FY17 saw Senex recoup its losses by 68 per cent to $8.8 million but also saw its revenue drop almost 40 per cent down to $22.8 million in line with lower sales volumes and a lower realised oil price per barrel.
The company has plans to develop and expand its positions in the Surat and Cooper Basins to tap into the east coast gas markets and at the heart of that is a tie-up with Washington DC-based EIG Partners as a major shareholder.
EIG will provide up to US$300 million towards the development of the Western Surat Gas Project along with $40 million through a placement to retail shareholders.
The Western Surat Gas Project which should be online in mid-2017 is expected to produce around 600,000 barrels of oil per annum.
To counter the lower oil price, Senex is placing a focus on disciplined capital allocation and will prioritise investment opportunities to meet their economic criteria.
Production of oil as a whole has dropped, with approximately 410,000 barrels produced in the last six months of 2016, compared to approximately 540,000 produced in the same period in 2016.
27. SUPERLOOP (SLC)
CEO (interim): Bevan Slattery
SUPERLOOP's second year on the block was punctuated by the announcement of a plan to develop a Pan-Asian submarine cable system that connects Singapore to Perth, Perth to Sydney and Sydney to Singapore.
To make this happen, CEO Bevan Slattery acquired telecommunications provider SubPartners for $3.3 million as that company is part of a consortium that will build a major undersea cable system connecting Australia, Singapore and Indonesia. And Slattery's Superloop just happened to own 80 per cent of SubPartners anyway so their strategy appears well and truly on track.
The Group reported a boost in revenue of 351 per cent to $8.8m in 1H17 but still posted a loss of just under $2 million for the half year mainly because of the group's $2.2 million acquisition of BigAir Group Limited.
In September, Superloop raised $65 million in equity capital and increased its three-year debt with ANZ Bank to $80 million to fund the BigAir deal.
Superloop's Australian operations now includes BigAir Group, CINENET Systems, and APEXNetworks which all contributed $7m in revenue.
28. PINNACLE INVESTMENT MANAGEMENT GROUP LIMITED (PNI)
MD: Ian Macoun
PREVIOUSLY named Wilson Group, Pinnacle Investment Management Group (Pinnacle) attracted plenty of attention in January when it made an audacious bid for beleaguered fund management group Hunter Hall International.
It lobbed a rival bid at a 50 per cent premium to Washington H. Soul Pattinson's offer and CEO Ian Macoun says he's been eyeing off Hunter Hall for about two years.
It sparked a bidding war but Pinnacle ultimately was shut out.
Wilson Group spun off Pinnacle in August 2016 and the financial management company has reported a $1 million increase in profits under the re-branding.
29. EML PAYMENTS LIMITED (EML)
CEO & MD: Tom Cregan
THE first half of 2017 for EML Payments (formerly Emerchants) was "the strongest financial result that the company has yet delivered" with revenue for the Brisbane payments provider rising 207 percent to $32.4 million.
The number of active EML accounts rose to 11 million, thanks in part to the strong non-reloadable incentive cards in Australia and shopping mall gift cards and $430 million was loaded onto these cards in the period.
In addition to their partnerships with reputable betting companies in Australia from last financial year, EML signed new business partnerships with Caesars Entertainment and McMillan Shakespeare Limited.
The company expects these programs to generate a minimum of $1b in incremental GDV in the 2018 financial year.
30. VITA GROUP (VTG)
CEO: Maxine Horne
THOUGH 2016 was a huge year for communications retailers Vita Group, 2017 has been a little rocky for the company with rumours that Telstra wants to take back some of its high performing stores.
Vita Group operates 102 Telstra stores and its share price took a 21 per cent hit in one day, although Telstra has denied the rumour and the company's fundamentals look solid.
Net profit after tax rose 10 percent to $21.4 million and reflects Vita's continued execution of what seems to be a good strategy to optimise their retail channels and transform and scale their business channels.
The acquisition of three Telstra stores during the period benefited the company, however they did shut down one Telstra store in the same period.
Vita remains healthy with no net debt. Improved productivity from the retail network is the main goal of the company moving forward into 2017 though they do expect some softening of profitability due to changes in commercial terms with Telstra.
CLICK BELOW FOR THIS YEAR'S TOP 50
Market caps based on end of trading April 27, 2017.
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Author: Ben Hall, David Simmons, Paris Faint, James Perkins