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Strong commodities performance and major constituent gains boost Deloitte WA Index


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4 August 2014:  The Deloitte WA Index rose 18.9% in the year ended 30 June 2014, closing at $149.3bn, but it was a story of two halves, with the gains recorded in the first six months of the year.

Deloitte released a special annual edition of the Index at the Diggers & Dealers Mining Forum in Kalgoorlie today, highlighting the performance of Western Australian listed companies – resources companies in the gold sector in particular – in the 2013-14 financial year.

Deloitte Clients & Markets Partner Western Australia, Tim Richards, said the FY14 result was driven by significant gains across a number of commodities and strong performances by some of the Index’s heavy weights.

Wesfarmers (20.1%), Woodside (17.3%) and Fortescue Metals Group (43.1%) all experienced significant growth in market capitalisation, representing 74% of the total increase in market capitalisation of the Deloitte WA Index for FY14.

Overall, commodity prices had a strong year, with nickel and palladium the top performers, with price growth of 39.0% and 31.2% respectively. Precious metals in gold and silver also experienced strong gains of 8.3% and 10.6% respectively.

“The performance of companies in the Deloitte WA Index this year has not been without its trials, with global economic sentiment rising and falling over the course the year as a result of events such as the political turmoil in the Ukraine and fears of a slowing Chinese economy,” Tim Richards said.

“The result was a mixed impact on commodities and key players in the WA market.

“At this year’s Diggers & Dealers, I expect the gold mining industry will be a major focus with issues such as price volatility, cost reduction and concerns over state royalties gaining momentum,” he said.

Compared to the Index’s 18.9% growth, the ASX gained 12.7% and global indices also had strong years – the US S&P 500 (up 22.0%), the FTSE 100 (up 8.5%) and the Nikkei (up 10.9%). Consumer sentiment has continued to slowly recover on the back of positive economic data from a number of Western countries, combined with signs of increased manufacturing activity in the global market.

The Deloitte WA Index report includes the results of a survey of WA-based gold companies, reviewing the past 12 months, and looking at emerging issues and trends – such as the potentially negative impact of a royalty increase and future M&A activity – and what they believe the future holds for their businesses.

The report also acknowledges the top five WA-listed growth companies over for FY14 in the gold sector:

  • Gold Road Resources Limited – increased market capitalisation by 664% from $20m to $149m (ranked 70 in the Index)
  • Saracen Mineral Holdings Limited – increased market capitalisation by 375% from $68m to $325m (ranked 45)
  • Northern Star Resources Limited – increased market capitalisation by 194% from $248m to $730m (ranked 21)
  • Papillon Resources Limited – increased market capitalisation by 194% from $226m to $665m (ranked 22)
  • Metals X Limited – increased market capitalisation by 166% from $162m to $430m (ranked 35).

“The market capitalisation of these companies has continued to rise, despite the fluctuating gold price and the constantly changing global sentiment towards the precious metal during the year,” Mr Richards said.

Resource companies outside the gold sector to have delivered growth in excess of the market included:

  • Wolf Minerals Limited – increased market capitalisation by 419% from $44m to $226m (ranked 56)
  • Panoramic Resources Limited – increased market capitalisation by 413% from $52m to $267m (ranked 50)
  • TNG Limited – increased market capitalisation by 349% from $23m to $102m (ranked 95)
  • Iron Road Limited – increased market capitalisation by 253% from $49m to $175m (ranked 65)
  • Atrum Coal NL – increased market capitalisation by 209 from $90m to $278m (ranked 49).

WA’s top 100 listed companies (by market capitalisation) at 30 June 2014 (see the table in the downloadable version of the media release)

NB: See our media releases and research at www.deloitte.com.au

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Last Updated: 

Contacts

Name:
Tim Richards
Company:
Deloitte Australia
Job Title:
Partner, Clients & Markets
Phone:
Tel: +61 8 9365 7248
Email
atrichards@deloitte.com.au
Name:
Warrick Hazeldine / Casey Hockey
Company:
Cannings Purple
Job Title:
Phone:
T: +61 8 6314 6300
Email
whazeldine@canningspurple.com.au, chockey@canningspurple.com.au

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