We've seen some big moves in share price this reporting season, and although the general economy is showing signs of improving, earnings and revenue growth are the real indicators of overall growth. These three companies pleased the market.
Print and digital media company Fairfax Media Limited (ASX: FXJ) has flown up, gaining about 40% over the past month in share price. Since early 2010, it had been trending down from about $1.80 until it bottomed out at around $0.40 in late 2012. It looked like it was falling behind, not keeping up with the digital drive that was moving viewers online, and the online business it did have was losing out to newer competitors.
The most recent six months ending in December now show the company moving into gear to acquire online businesses to complement its domain.com.au real estate listings website and its jobs classifieds business, as well as linking up its newspapers and magazines to the digital media.
The results of its continuing businesses produced a half-year underlying net profit of $86.4 million, up 48.5% from the pcp even though total revenue was slightly down at $1.08 billion. Revamping itself, and concentrating on higher profit margin business could mean a turnaround over time. Shares traded last at $0.94.
Breville Group Ltd (ASX: BRG) is another stock setting a fast pace upward, with the home appliances company gaining 22% this past month, and currently at $9.74. The share price has more than tripled in a little more than two years, and annual underlying net profit has climbed from about $35 million to $50 million.
It has launched a new business into the UK, creating a new brand called Sage that will go along with its other well-known brands such as Breville and Kambrook. Also, it has teamed up with Nestlé Nespresso to create co-branded Nespresso coffee machines in Australia and New Zealand.
Half-year revenue saw a 17.7% expansion on the pcp, but underlying net profit was down 1.6% to $31.1 million. Its business segment outside of its ANZ and US regions saw the greatest improvement in EBITDA, but the North American market was down the most percentage wise by 11.9% in EBITDA. The company plans to expand more internationally, especially within Asia.
SEEK Limited (ASX: SEK), the online jobs classifieds portal, nailed another impressive half-year by increasing reported NPAT 65% to $111.2 million on $380.7 million in total revenue. Over the past month, the share price is up about 36%, hitting an all-time high of $17.20.
It also announced that it's acquiring Singapore-based online jobs website JobStreet to further move into the South-East Asian job listings market. It already has a controlling interest in Zhaopin, a Chinese jobs portal which is planning for an IPO, and JobsDB is another jobs website that its subsidiary Seek Asia operates.
Growing into the Asian market where a major proportion of the world's population is located allows it to put its expertise and technology to work for future growth.
Foolish takeaway
As an investor, I want to see Australia's best companies expanding into nearby regions, and export the best natural resource that this country has – innovation. Real growth will come from deeper business networks in Asia.
