Materials technology player PPK Group has been on a tear since the COVID-19 market dip, breaking into the top 30 as optimism surrounds a light but incredibly strong carbon fibre it plans to take to market through a joint venture with Deakin University.
This is a very tech-focused section of the list in general, including the likes of Data#3 that has benefited from the cloud trend, and Novonix as it taps into the prospective electric vehicle market with battery technologies.
Famously regarded as one of the few airlines in the world that is turning a profit, Alliance Aviation is now cruising at new latitudes on the Brisbane Top Companies list.
21. JUMBO INTERACTIVE (JIN)
2019 Rank: 15
Market Cap: $863m
FY20 revenue: $72.1m
FY20 profit: $25.8m
CEO: Mike Veverka
CEO salary: $1.3m
Australians love a punt, so it's no surprise that lottery group Jumbo Interactive (ASX: JIN) sailed through the pandemic with a 9 per cent increase in revenue.
And nothing shows the changing way we like to bet than the fact a 72-year-old Jumbo customer won the $80 million Powerball with an online ticket during the COVID-19 period.
Jumbo, which celebrated 25 years since listing during the year, set a fast pace during 2020.
It operates the website www.ozlotteries.com in Australia under agreements with Tabcorp, a deal that dates back to 2005.
The company inked a fresh 10-year agreement with giving it the ability to continue the strong growth of its Australian ticket selling business and build the "Powered by Jumbo" software business domestically and overseas.
In September one of the company's subsidiaries, TMS Global Services, started negotiations with West Australia's Lotterywest to provide its online software platform and services for up to the next 10 years.
Jumbo also nabbed Gatherwell Limited in the UK, the largest external lotteries manager to local authorities in the country, giving the company a launch pad into that market.
The lottery group is now laying plans for further international expansion, and is sniffing for opportunities to break into the lucrative North American lottery markets.
Meanwhile, Jumbo remains focused on its "$1 billion vision", a target of $1 billion in ticket sales on the Jumbo platform by FY22.
22. Data#3 (DTL)
SOFTWARE AND SERVICES
2019 Rank: 29
Market Cap: $841m
FY20 revenue: $1.62m
FY20 profit: $23.72m
CEO: Laurence Baynham
CEO salary: $1.14m
The ever-expanding cloud has kept information technology group Data#3 (ASX: DTL) on a high, with the company posting another record profit in FY20.
The take-up of public cloud services has been Data#3's big success story leading to a 60.4 per cent surge in revenue.
As if that wasn't enough, the company has also been given the gong for being Australia's employer of choice in 2020. The gold medal award, bestowed by Human Resources Director (HRD) magazine, is the second consecutive win for Data#3 with the company rated for training and professional development, development of strong and effective leaders, work-life balance, and health and wellbeing.
The company has more than 1,200 staff across 12 locations in Australia and Fiji. About 97 per cent of them worked remotely during the pandemic this year.
CEO Laurence Baynham explains technology is vital for businesses as they settle into the new normal.
"Across all facets of life and work, the need for powerful technology solutions has never been more pronounced," he writes in the company's annual report.
Baynham sees opportunities ahead for Data#3 amid the current conditions with digital transformation and technology-driven solutions leading the way.
That was evident in the second half of FY20 when the pandemic led to higher demand for infrastructure and software services from the public and private sectors. Data#3 accelerated the delivery of remote working solutions, responding quickly to capitalise on the demand.
There was one glitch in August, when Data#3 reported a cyber-security threat from overseas that affected 28 customers. The incident was not serious enough to be notifiable to the Australian Information Commissioner.
23. GWA Group (GWA)
2019 Rank: 21
Market Cap: $771m
FY20 revenue: $398.7m
FY20 profit: $43.88m
CEO: Tim Salt
CEO salary: $1.67m
Heading into FY21, GWA Group (ASX: GWA) was preparing for a decline in the construction sector that would keep a lid on earnings growth.
That comes on the heels of a challenging June quarter amid the COVID lockdown - a period that sliced $8.6 million from its pre-tax earnings.
As one of Australia's leading suppliers of commercial and residential building fixtures, GWA relies heavily on a robust construction sector. It managed to do relatively well in FY20 despite the pandemic.
That was helped by its 2019 acquisition of New Zealand showers and taps maker Methven. GWA encountered a reduction in stocking by its customers ahead of the lockdown and a slow restocking by them afterwards.
So, instead of worrying about matters it couldn't control, the company focused on costs and particularly integration synergies regarding the Methven acquisition.
The sales team integration led to $3 million in savings in FY20, while a further $10.5 million was achieved in short-term cost reductions.
GWA is hopeful the renovation market will sustain activity in the near term, as new construction activity weakens. It is also looking to new product development in the Caroma and Methven brands to help drive sales.
GWA is investing further in the Caroma Smart Command technology, a Bluetooth-enabled and cloud-connected system that allows building managers to monitor water usage and predict maintenance issues.
The rollout of the system was hit by the lockdown in the second half of FY20 as the target market includes airports and retail centres.
As with many other companies with a retail interface, GWA reported an increase in digital activity with a 23 per cent increase in traffic on its Caroma website.
24. AUSTRALIAN AGRICULTURAL COMPANY (AAC)
2019 Rank: 24
Market Cap: $687m
FY20 revenue (to 31 March 2020): $334.1m
FY20 profit: (to 31 March 2020): $31.11m
CEO: Hugh Killen
CEO salary (Year ending March 2020): $774,000
After a poor 2019, Australian Agricultural Company (ASX: AAC) beefed up its returns to come out firing in 2020.
Once again the company's wagyu product led the herd, with sales growing a further 19.7 per cent over the year.
Sales growth was well done in Asia, a market that accounted for two-thirds of AACo's wagyu meat sales.
Consumers in Asia were also drawn to the food safety benefits of Aussie protein after an outbreak of African swine flu tainted pork supplies in China.
The venerable company, which will celebrate its centenary in 2024, made huge strides in the North American market too where it recorded a 34 percent increase year-on-year in wagyu meat sales revenue.
This came on the back of a discerning eating public who want to know more about the steak on their plates.
"While provenance is important to consumers, increasingly they are also demanding to know more about the sustainability practices of the companies from which they source their food," company chairman Donald McGauchie told shareholders.
The company was still feeling the effects of floods in northern Australia in 2019, with its 2020 herds still 19 per cent lower than the previous year, finishing just shy of 350,000 head.
However, its breeding herd remains protected.
The company also managed to grow its substantial Australian landholdings, taking out a 10-year lease on the 17,500ha Rewan Station in Central Queensland.
This gives AACo more than 26 stations, farms and feedlots to find a field for its herd to graze on.
25. ALLIANCE AVIATION SERVICES (AQZ)
2019 Rank: 35
Market Cap: $563m
FY20 revenue: $298.7m
FY20 profit: $26.9m
MD: Scott McMillan
MD salary: $734,761
Led by industry veteran and founder Scott McMillan, boutique carrier Alliance Aviation (ASX: AQZ) showed airlines didn't have to crash and burn during the pandemic.
A focus on building income streams helped ensure the airline not only stayed afloat, but recorded a $4.3 million lift in profit.
As McMillan told shareholders at the company AGM about the group's successful June capital raising: "At the time I am sure we were the only profitable airline in the world seeking to raise funds for expansion purposes, and we were delighted that the raising was nearly three times oversubscribed"
While traditional airlines struggled in the pandemic, Alliance managed to lift contract revenue to $202.5 million.
Ironically, this could be attributed to social distancing as mining companies were forced to lift the number of flights to mine sites to cope with social distancing.
The contract revenue stream shows no sign of slowing with Alliance concluding a deal with BHP to continue flying to the miner's Olympic Dam project for another three years with two 12-month extension options.
And an upgrade in the deal to the larger Fokker 100 jet means more miners will be at work faster.
And while the company's public transport revenue fell as airports shut down, its charter revenue rose by 97 per cent to $26.4 million to a number of new resource sector clients, sporting teams and various emergency services agencies.
The airline took the opportunity during the year to expand its fleet, announcing it would spend US$79.4 million to add 14 Embraer E190 aircraft and a raft of parts.
Alliance recently applied to the Australian Competition and Consumer Commission for permission to join forces with Virgin to co-operate on regional, a move that will no doubt annoy Qantas, which retains a 20 per cent stake in the junior airline.
26. SENEX ENERGY (SXY)
2019 Rank: 26
Market Cap: $467.22m
FY20 revenue: $122m
FY20 Loss: $51.4m
MD & CEO: Ian Davies
CEO salary: $1.32m
While it was another year of losses for Senex (ASX: SXY) shareholders, there was a pilot light at the end of the tunnel.
In FY20 the gas producer could point to production being up 73 per cent and sales up 28 per cent to $120 million, yet it still recorded an annual loss of $51.4 million.
Early in November Senex announced it was leaving the Cooper Basin after more than 20 years of development to concentrate on its $400 million Surat Basin gas development projects.
Senex will sell its Cooper Basin assets to Beach Energy (BOT) for $87.5 million, with the transaction due for completion in the March quarter of 2021.
Speaking at an investor briefing in November, managing director and CEO Ian Davies said the sale would strengthen Senex's balance sheet and cashflow resilience.
He also gave some hope to shareholders, saying it would allow the company to accelerate production growth from the Surat Basin and start dividend payments from FY22.
"Senex's growth transformation has created a natural gas business with a robust balance sheet and a strong and growing production profile," Davies said.
"Following successful delivery of our $400 million Surat Basin natural gas developments, we are uniquely positioned to increase supply of natural gas through our established hub-and-spoke infrastructure operating model."
27. ANTIPODES GLOBAL INVESTMENT COMPANY (APL)
2019 Rank: 27
Market Cap: $501.08m
FY20 revenue loss: $10.21m
FY20 loss: $11.93m
Chairman: Jonathan Trollip
Chairman salary: $45,000
As an asset manager with responsibility to manage more than $8 billion, Antipodes Global Investment Company (ASX: APL) had a rough trot in FY20, primarily due to the market crash associated with the COVID-19 pandemic.
With a focus on companies for long positions, the group found success in tech stocks that performed well during the pandemic period.
The same cannot be said for its worst performing investments; namely in oil and gas firm TechnipFMC; Tapestry, the luxury fashion multinational and owner of Coach New York and Kate Spade; and Dutch banking behemoth ING Group.
The impact of the pandemic on Antipodes was clear, with profits freefalling a whopping 255 per cent to a loss of $11.93 million.
This was reflected in the group's own share price which dived alongside the rest of the global market in March to a historical low of $0.87 per share.
Shares in the company have since recovered by 20.69 per cent to around $1 per security.
Antipodes says it protected investors from the worst of the crash. Specifically, it watched its portfolio fall just 12.6 per cent during the February and March mass selloffs, whereas the global index fell 23 per cent.
Since then, the company's portfolio returned 25.8 per cent "due to a pragmatic approach to value" according to the group's fund manager Antipodes Partners.
However, with the global market awash with monetary stimulus the company is refocusing its attention to the Chinese and European markets, which it believes to be the geographies best suited to recovery.
"We believe Europe and China will lead the way," Antipodes Partners said.
"Both appear to be in better shape relative to the US to make the transition to investment-led stimulus from an infrastructure planning and government debt perspective.
"In Europe and China, we expect this investment will be in the form of green investment, electric vehicles and 5G adoption."
A 'barbell' approach to investment will underpin Antipodes' FY21 where it will own "cheaper expressions of growth and defensive assets (e.g. Microsoft, Facebook, Roche) while maintaining exposure to high quality cyclical/lower multiple stocks with growth opportunities (e.g. Siemens, Electricite de France, Volkswagen)".
Investors in the firm weren't strung out to dry despite the group's performance, with Antipodes paying $24.11 million in dividends during the year, down from $36.61 million the year prior.
In a first for the Australian market Antipodes has proposed a conditional tender offer (CTO) program to shareholders.
The CTO will enable shareholders to exit a minimum 25 per cent of their shareholding at close to NTA. A vote on approval of the CTO will occur at the company's AGM on 30 November 2020.
28. PPK Group (PPK)
2019 Rank: 32
Market Cap: $524.6m
FY20 revenue: $41.1m
FY20 Profit: $8.3m
Executive Chairman: Robin Levison
CEO salary: $240,000
Boron nitride nanotube technology may be a mouthful to say, but it is transforming PPK Group (ASX: PPK) from a mining technology outfit into a multi-faceted technology player.
The material has been touted as being 100 times stronger than steel but as light as carbon fibre and flexible.
In March 2019 PPK took a 50 per cent stake in Boron Nitride Nanotube Technology (BNNT), a joint venture between the company and Deakin University along with some scientists.
Since then the group has been consolidating and changing.
In December last year it wrapped up a 45 per cent stake in Gold Coast-based defence group Craig International Ballistics, a manufacturer of soft and hard ballistic body armour.
In July it entered the dental technology market with a new joint venture with dentist Dr David Nunn and Deakin University to develop a range of new materials with superior physical properties and aesthetic values.
The group, led by Robin Levison of Eureka Group and Industrea fame, is exploring a wide range of fields that could be suitable for the new technology, including new kinds of batteries, 3D printing, transparent materials for many industries and insulation for electronic device packaging.
With this in mind, it is no wonder Levison described BNNT as "an innovative material which can in turn be a game changer for a large number of industries."
Those expansion deals also showed signs of paying off with PKK announcing in May that Craig International Ballistics had won a $1 million contract to supply the Australian Defence Force with 750 sets of soft armour inserts to replace in-service armour.
Levison said the company could see the opportunities CIB would provide to the defence and other customer sectors in the coming years.
"CIB and PPK are already reviewing opportunities on how CIB products and technologies could be applied to both the underground and open cut mining sectors, both here in Australia and globally."
29. AURELIA METALS (AMI)
MINING AND EXPLORATION
NEW TO LIST
Market Cap: $463m
FY20 revenue: $331.8m
FY20 profit: $29.4m
MD: Daniel Clifford
MD salary: $1.235m
Aurelia Metals (ASX: AMI), which runs mines in the Cobar Basin in NSW, aims for a mix of maximising returns from its producing assets while pushing forward new developments.
Both Peak and Hera mines extract ore using underground mining methods.
The company sits in an enviable position, boasting in its annual report of no debt and $79 million in the bank.
And while its gold production dropped for the year by 22 per cent to 91,000 ounces - which was in line with forecasts - production of other metals including silver, copper, lead and zinc all rose significantly to compensate.
Aurelia is tipping gold production to fall in the current financial year, issuing guidance that it expects to produce between 80,000 and 90,000 ounces across of gold across both of its mines.
In 2021 the company will turn its attention to its nearby Federation deposit, which it reports as showing strong signs of holding solid gold reserves.
30. NOVONIX (NVX)
TECHNOLOGY, HARDWARE AND EQUIPMENT
NEW TO LIST
Market Cap: $393m
FY20 revenue: $4.2m
FY20 loss: $19m
MD: Chris Burns
MD salary: $350,000 plus superannuation
A pair of agreements with two of the world's biggest electronics companies has seen Novonix's (ASX: NVX) share price charge up, more than doubling since the start of the year.
The battery technology group started by signing a conditional agreement to supply lithium-ion battery anode material to Korean giant SAMSUNG SDI, an international manufacturer of lithium-ion batteries, in December.
It quickly followed this up in January when it signed a memorandum of understanding (MoU) with Sanyo to investigate the opportunity for wholly-owned subsidiary PUREgraphite to supply graphite anode material for use in lithium-ion battery manufacturing.
Then managing director Philip St Baker - son of energy baron and electric vehicles advocate Trevor St Baker, as well as former CEO of ERM Power - said the collaboration was a further endorsement of Novonix.
In all, the St Baker family has close to a 22 per cent stake in the group, while Soul Patts is also a minority shareholder with around 4.3 per cent.
"We hope that the collaboration will progress positively and, whilst non-binding, prove to be a key step in establishing potentially a long-term supply arrangement with our second customer," he said.
The group then launched a successful capital raise and restructure June, which raised about $63 million.
Of the proceeds $25.5 million will be used to tidy up the balance sheet by recouping convertible notes and repaying director loans.
This has left with company with a $38.8 million war chest for FY21.
Novonix has also moved to improve its liquidity by tapping into the North American market.
In July it applied to be listed on the OTCQX market, a market favoured by international firms looking to attract North American investment.
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Market caps based on end of trading November 27, 2020
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