This is what the Flux.
I'm Brett and I'm Justin and it's Friday, the twenty first of February.
Juzzy boy.
When it comes to e commerce in Australia, get this. The average online order value has dropped by twenty three percent in just the last two years. That's according to courier platform ship It. They've analyzed millions of orders and they reckon a mix of economic pressures and intense global competition is the blame.
The Shean's t moves. They're coming for Australian retailers. Sick and fast, Flux Sam once again, it is Briday, which means we're dishing out fifty dollars to the smartest person in the Flux community. That's right. We're going to send a random notification today and the first person to answer three business or finance questions correctly as the fastest win fifty bucks to get off the weekend. To make sure to turn on your notifications, download the Flux app and be ready to win.
Three prepared stories today. Juzzy boy, Let's do it for our first.
Telstra has dialed up a net profit of just over one billion dollars for the last six months after seeing growth in it it's mobile business and saying goodbye to Foxtael, not to.
Mention a heap of cost cutting Beman, but.
Do go on well.
Telster is Australia's biggest telco and one of the most recognizable brands in the entire nation.
It provides retail services to over twenty two million Australian customers.
But Juzzy Boy. Over the past few years, Telstra has been making some changes.
In fact, be Man. As part of its T twenty five strategy, it cut nine percent of its workforce.
And it seemed to work so far for the big T Yeah.
Its revenues managed to grow one and a half percent over the last six months to eleven and a half billion dollars and.
As net profit jumped six and a half percent to one point three bill not to mention.
The sale of Foxtel and its VC during this period.
Now, apart from these one off zingers, Heelster praised its consumer division as the MVP and be man.
With the T twenty five turnaround on track, Heelster will buy back seven hundred and fifty million dollars worth of shares.
And it has jacked up its dividend by more than five percent.
In other words, investors are getting a little dividends week for sticking around.
So what is the key learning here?
Investors ten dislot companies into three big categories. You've got the growth, You've got the income, or you've got the value company, a little bit like choosing a mobile plan exactly. On the one hand, you've got growth companies. These are the companies that are expect to grow faster than the market average.
They're the ones reinvesting every darn dollar back into the business instead of paying out dividend.
Think Meta, who paid its first dividend in twenty twenty four, twelve years after going public.
And on the other hand, you've got income stocks.
These are the ones like Telstra that pay out a portion of their profits to shareholders on the regular.
And jaz boid.
These income stocks typically attract investors who are keen on regular dividend.
Payouts think retirees.
For example, Telstra's share price has only increased just over four percent over the past five years before yesterday's update.
But be manufacturing all those dividend payouts, and shareholders have pocketed nearly a dollar per share in cash over that same five year period.
And of course you've got the value investors, the ones who look to invest in undervalued companies based on their financials be man.
With Telstra's latest result, it's giving income focused investors even more reasons to stay on the dial for.
Our second story of West Farmers has seen its sales and earnings jump in the first half of the financial year thanks to its goat performers Bunnings and Kmart.
Bunnings and Kmart are the gifts that keep on giving for wezi Is, So tell me what well.
West Farmers is the WA based owner of some of the biggest named brands in Australian retail.
As mentioned, they owned Bunnings and Kmart.
They've also got their b grader as Juzzy Boy, your targets, your price lines, your silk laser clinics, and they've also got office works, which i'd say is an a grader and.
Formerly they owned Catch as well, which they announced plants to shut down last.
Month the Juzzy Boy.
It also owns industrial and safety businesses as well as chemicals and energy and fertilizer businesses.
Your Clean Heats, your Blackwards.
West Farmers has announced its sales for the last half jumped by three point six percent to over twenty three and a half billion dollars, and off.
The back of these sales it delivered a tasting their profit of just done that one and a half billion baccarinis.
Enough to buy every single kmart dupe and still have change left over for a Bunning snag or three and be Man.
West Farmer's reckons. A key part of this success is its pricing strategy of every day low.
Prices fascinating stuff. So what is the key learning here?
Consistency builds trust while discounts create urgency.
You see Bunnings and came up primarily user pricing strategy called everyday low prices.
The idea is they consistently offer products at the lowest prices.
And it means they don't rely on frequent promotions or discounts be Man.
This is in contrast to the other pricing strategy, which is called high low pricing.
This one is when companies set higher prices but offer discounts and promotions.
And b Man. Historically, more than forty percent of groceries in supermarkets are purchased on special or promotion each week. According to Nilson, and.
While high low pricing attracts deal hunters. It also means shoppers aren't particularly loyal.
Yeah, they will happily ditch coals for woolies if butter is fifty percent cheaper.
And based on these numbers, it's safe to say West Farmers has mastered the art of keeping OSSI's spending.
For our third and final story, Nicola, the electric trucking startup, has filed for bankruptcy in the US after struggling to raise money or find a buyer.
The old Tesla of trucks has run out of charge. Tell me what's going on here?
Okay? So Nicola launched back in twenty fourteen with big bold plans to revolutionize trucking with hydrogen electric batteries and point.
Nicola went public via a spack a blank check company that was valued at thirty billion dollars US, and that was in June twenty twenty.
Man name more iconic duo than spacks and overinflated valuations.
But Jazzy boy.
Now Nicola has announced it will file for bankruptcy after it could not raise money or find a new buyer.
And be man. It isn't that surprising because Nicola has been facing scandals for years.
Well, it has been accused of making exaggerated claims about its technology.
Yep, they claimed they built the truck from the.
Grounder, but it was uncovered that they actually bought the batteries from another company.
What about when they released a marketing video showing their truck driving.
But in reality the truck was just rolling down a hill.
But be man now, Nichola says it couldn't even scrape together enough cash to keep the hydrogen engines pairing.
And this is all part of the natural evolution of a new industry.
So what is the key learning here?
When a shiny new.
Industry takes off, it often attracts a flood of startups, all elbowing each other to become the next big thing.
But den b man. As the industry matures and competition intensifies, funding becomes harder to secure and.
A weaker players struggle to survive, and.
This leads to consolidation where only the strongest companies remain standing.
And this is what we're seeing in the electric vehicle market right now. And startup ev companies like Fiska, Canoe, Weltmeister all household names. Jazzy Boy, they've all declared bankruptcy over the past few years.
After raising and burning billions of dollars.
Of cash, and now Nikola joins the pack. Slash the scrap heap.
Fox down, get on your phone, turn it off silent so you can be the first person to answer our three questions, and we've beducks this week. It's the perfect way to test your knowledge and also come away with some cash.
Thanks for listening and we'll see you on Monday.