With annual company reporting season now behind us for another year, it’s important to reflect on some of the headline themes that dominated the period, as this is likely to influence performance throughout the remainder of FY2015.
One notable trend was small caps outperforming their large cap counterparts for the month of August, after two years of underperformance. During the reporting period, the four major banks and mining companies had a softer month relative to the overall market.
Standout small caps include Slater & Gordon Limited (SGH, see Russell Muldoon’s article today) and Ardent Leisure (AAD), both of which attributed a focus on acquisitions activity for their strong performance. The result announced by Slater & Gordon exceeded the expectations of the market, beating the forecast by 3%. It was a positive end to the year for the consumer law firm, supported by the company’s UK operation, which has made several acquisitions over the past two years, including law firms Russell Jones and Walker, Panone and Fentons. As part of its results announcement, Slater & Gordon also advised it has two more acquisitions planned for the Australian arm, which is expected to drive growth throughout the remainder of FY2015.