3 ASX 200 shares that doubled profits this reporting season 

Pent up demand and working from home were factors that helped these 3 ASX 200 shares double profits this reporting season

| More on:
Good news has these businesspeople cheering for joy, partying in a board room.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

February reporting season was an opportunity for S&P/ASX 200 Index (ASX: XJO) shares to demonstrate that the economic effects of COVID-19 are largely behind us and business is starting to get back on track.

Earlier this week, Commsec advised in its Economics Insights report that 86% of companies were able to report a statutory profit for the six months to December 2020, but that aggregate interim earnings fell by 17%. 

Despite the broader earnings weakness for ASX 200 shares, here are three that managed a significant turnaround in net profits. 

ARB Corporation Limited (ASX: ARB

ARB is Australia's largest manufacturer and distributor of 4×4 vehicle accessories. The company's half-yearly report is a true earnings recovery story with profit after tax up 113.5% on the prior corresponding period to $54 million. The company attributed the turnaround to pent up demand created during the early period of lockdown. 

The company highlighted a respectable 14.0% increase in sales to the Australian vehicle aftermarket, while export sales grew strongly by 36.7% and represented more than a third of the company's total sales. 

Despite profits doubling, the ARB share price is down nearly 9% since the company released its half-yearly report. But looking at the bigger picture, the ARB share price has run by more than 200% since the initial March 2020 COVID-19 selloff. 

Harvey Norman Holdings Limited (ASX: HVN

Harvey Norman delivered a record half-yearly result which saw its reported profit after tax surge 116.3% to $462.03 million. The company pointed to strong growth in areas such as technology, with computers and related peripherals, leading the way due to the continuation of working from home.

Other categories that supported its surging revenues include gaming, boosted by the launch of PS5 and XBox Series X in November 2020, whitegoods, furniture and bedding. 

The company also highlighted apparent trends that supported growth in new areas such as outdoor furniture and outdoor cooking categories, as consumers rushed to transform their backyards and other entertainment spaces. 

The strong uptake of the federal government's HomeBuilder grant also supported Harvey Norman's home & lifestyle segment. The company sees the surge in new dwelling constructions and major renovations as a catalyst to drive sales and new opportunities moving forward. 

Ramelius Resources Limited (ASX: RMS

The gold spot price has been grinding lower to US$1,700 after hitting a record US$2,075 per ounce in August 2020. This has translated to weakness across the board for ASX gold mining shares. 

However, Ramelius has been a quiet achiever, with its half-yearly results highlighting a 57% increase in gold production to 144,240 ounces and a 294% surge in net profit after tax to $81.3 million. 

The company has a strong track record of increasing gold production, with year-on-year gold production increasing 21.5% since FY15. The company noted that its strong cash generation will be invested in current and future projects, and also a return to shareholders. 

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ARB Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

A happy young couple lie on a wooden deck using a skateboard for a pillow.
Broker Notes

10 Aussie stocks to buy in FY 2026

Let's see which shares analysts think could be buys in the upcoming financial year.

Read more »

Person pretends to types on laptop drawn in sand.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a disappointing end to the trading week for investors this Friday.

Read more »

A young boy points and smiles as he eats fried chicken.
Share Gainers

3 ASX All Ords shares smashing the benchmark this week

Investors are sending these three ASX All Ords shares rocketing 18% to more than 29% this week. But why?

Read more »

watch
Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

Disappointed man with his head on his hand looking at a falling share price his a laptop.
Share Fallers

Why APA, Flight Centre, Reece, and Transurban shares are falling today

These shares are having a tough finish to the week. But why?

Read more »

a young woman raises her hands in joyful celebration as she sits at her computer in a home environment.
Share Gainers

Why Alliance Aviation, BHP, Boss Energy, and Orthocell shares are racing higher

These shares are ending the week on a positive note. But why?

Read more »

Mum playing with her baby boy holding him on her tummy as she lays down while smiling about the Bubs share price going up today
Broker Notes

Following two unfortunate incidents, what's Macquarie's price target on Monash IVF shares?

Is Monash IVF a buying opportunity?

Read more »

A happy male investor turns around on his chair to look at a friend while a laptop runs on his desk showing share price movements
Broker Notes

Macquarie tips 18% return for this ASX 200 stock

The broker thinks this blue chip's profits are going to rebound in FY 2026.

Read more »