The most interesting reporting season since the global financial crisis kicks off next week, and these are the six key things to look out for:
- Big write-downs, particularly in the property and petroleum sector, some of which have already been announced
- Another raft of equity raising announcements taking advantage of the relaxed rules which make it easier to dilute retail shareholders
- A more conservative approach to paying dividends, particularly by banks, despite the desire from mum and dad investors for distribution of their beloved franking credits
- Commentary about the impact of COVID-19 when few companies really know what is going to happen
- Discretionary reductions in CEO bonus payments and board fees given the hardship being felt by everyone and huge government subsidies, and
- Disclosure, or lack thereof, about the scale of government support, particularly JobKeeper payments.
JobKeeper is currently running at $11 billion a month, so many listed companies are clearly receiving huge taxpayer subsidies with the biggest being the likes of Qantas, Crown Resorts, Myer, Premier Investments and cinema giant Village Roadshow.
Given the materiality of the payments, these companies are all expected to release precise JobKeeper numbers, similar to what K&S Corporation disclosed last week. The transport company founded by the late Mount Gambier Rich Lister Allan Scott revealed that its 2019-20 net profit is likely to be between $15.8 million and $16.8 million, but only after receiving a hefty $12.4 million in JobKeeper payments in the June quarter alone.