Latest / What the Flux / Rio Tinto's $9.9 billion bet | Streaming-service Stan may test ads | GYG's spicy share update

Transcript

Rio Tinto's $9.9 billion bet | Streaming-service Stan may test ads | GYG's spicy share update · What the Flux

• 0:05
  Speaker 1: This is what the Flux. I'm Brett and I'm Justin
• 0:08
  Speaker 1: and it's Friday, the eleventh of October. Flex Family.
• 0:10
  Speaker 2: We've got a little bit of a different intro today
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  Speaker 2: because rather than sharing business news on other companies, today's
• 0:16
  Speaker 2: intro is about Flux.
• 0:18
  Speaker 1: Yep, we are very excited to announce that Flex has
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  Speaker 1: been acquired by net Wealth and ASX two hundred company
• 0:23
  Speaker 1: and one of the fastest growing wealth management and tech
• 0:26
  Speaker 1: companies in.
• 0:26
  Speaker 2: Australia and Flex Family very importantly, our podcast, our newsletter
• 0:31
  Speaker 2: and our app will all be remaining the exact same, Plus.
• 0:34
  Speaker 1: B Man, we now have even more resources to create
• 0:37
  Speaker 1: and do more and more and more. To stay tuned
• 0:40
  Speaker 1: as we share more updates over the coming months.
• 0:42
  Speaker 2: Judie Boy, three earth shattering stories today, let's do it
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  Speaker 2: for our first. Rio Tinto has swum against the lithium
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  Speaker 2: tide by acquiring arcadium lithium for nine point nine billion dollars.
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  Speaker 1: How when everyone's turning back to copper, Rio is backing
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  Speaker 1: in the lithium. So tell me well, Jazie Boy.
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  Speaker 2: Rio Tinto is the world's second largest metals and mining company,
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  Speaker 2: behind the other Aussie company, BHP.
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  Speaker 1: Rio Tinto is an absolute behemoth.
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  Speaker 2: Yeah, it is more than twenty three thousand people mining
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  Speaker 2: iron ore, aluminium, copper, and now Jusi Boy Rio just
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  Speaker 2: dropped a wheelbarrow full of cash nine point nine billion
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  Speaker 2: dollars to be exact, to acquire arcadium lithium.
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  Speaker 1: Now be man. We know that lithium has been the
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  Speaker 1: hottest of hot metals over the last few years since
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  Speaker 1: they power the batteries in electric vehicles.
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  Speaker 2: But what's interesting is despite the boom in lithium, there's
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  Speaker 2: actually been a ninety percent slump in lithium prices over
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  Speaker 2: the past eighteen months.
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  Speaker 1: That the man Riatinto CEO is backing in lithium over
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  Speaker 1: the long term. So what's the key learning here? Be
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  Speaker 1: fearful when others are greedy, and greedy when others are fearful.
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  Speaker 2: Oh, a very famous quote from your man Warren Buffet.
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  Speaker 1: Yep. It's all about buying solid companies when the market
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  Speaker 1: has assessed them too negatively based on short term factors.
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  Speaker 2: You see, Juzi boy lithium has dropped by ninety percent
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  Speaker 2: in the past eighteen months.
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  Speaker 1: If you zoom out a little bit further, it's still
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  Speaker 1: up over three hundred percent. Over the past three years.
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  Speaker 2: And the CEO of Rio Tinto is more focused on
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  Speaker 2: the average lithium price over the next decade rather than
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  Speaker 2: the next year.
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  Speaker 1: You see be man. As a multi multi, multi billion
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  Speaker 1: dollar company, Rio Tinto knows it'll be around for a while,
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  Speaker 1: so it can take advantage of the market's short term
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  Speaker 1: panic and does it. Boy what's the main reason for
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  Speaker 1: the drop in lithium prices. Well, there's been a slowing
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  Speaker 1: in the demand for electric vehicles around the world.
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  Speaker 2: But again, evs are expected to grow more than six
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  Speaker 2: point six percentage year across the world.
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  Speaker 1: So while it may not be experiencing the rapid growth
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  Speaker 1: or volatility of previous years, it's still trending in the
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  Speaker 1: right direction.
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  Speaker 2: And that is exactly why Rio Tinto has snapped up Arcadia.
• 2:41
  Speaker 1: For our second story, stan the streaming service owned by
• 2:44
  Speaker 1: nine Entertainment, is considering bringing advertising onto its platform to
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  Speaker 1: boost its revenue. Another one bites the dust for young
• 2:51
  Speaker 1: uncle Stanley. What's the story here, does boyd stan is
• 2:54
  Speaker 1: the aussy streaming service that was launched back in twenty fifteen.
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  Speaker 2: It's actually the fourth largest streaming service in Australia, behind
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  Speaker 2: the international Big wigs of Disney plus Amazon Prime and
• 3:04
  Speaker 2: of course Netflix.
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  Speaker 1: Now b man, it's the platform that has licenses to
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  Speaker 1: shows like Normal People, Breaking Bad and The OC in Australia,
• 3:12
  Speaker 1: which I know you loved and watched recently I did. Indeed,
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  Speaker 1: now now doeszy Boy.
• 3:16
  Speaker 2: Although STAN has grown to over two point two million
• 3:19
  Speaker 2: binge watchers paying for a subscription, STAN is reportedly looking
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  Speaker 2: to introduce a new revenue stream.
• 3:24
  Speaker 1: Don't say it, don't say it, don't say it, don't
• 3:26
  Speaker 1: say it. That's it. I'm gonna say it.
• 3:28
  Speaker 2: STAN is looking to introduce advertising onto its platform to
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  Speaker 2: increase revenue.
• 3:32
  Speaker 1: Hmmm, wonder where they got this? Completely original never been
• 3:35
  Speaker 1: done before, I diear from well doesy boy?
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  Speaker 2: Till now, Stan's been one of the only platforms that
• 3:40
  Speaker 2: hasn't run ads.
• 3:41
  Speaker 1: While still competing alongside the streaming giants like Netflix and Amazon.
• 3:45
  Speaker 1: But does it boys?
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  Speaker 2: Stan subscriber numbers have been sitting flat for the last
• 3:48
  Speaker 2: two years.
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  Speaker 1: So if it wants to increase its revenue, it'll either
• 3:51
  Speaker 1: need to increase prices to customers.
• 3:53
  Speaker 2: Or perhaps something crazy, find a new source of revenue.
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  Speaker 1: So what is the key learning here?
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  Speaker 2: As any industry evolves, needs to continue to find new
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  Speaker 2: and often creative ways to increase revenue.
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  Speaker 1: Ivan Man, we know for streaming services the main lever
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  Speaker 1: to increase revenue is to jack up the prices of
• 4:09
  Speaker 1: those subscriptions.
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  Speaker 2: But Josie, wait, give it our competitive the stream market
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  Speaker 2: is it can be very easy to lose market share
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  Speaker 2: when you hike up those prices too high, which.
• 4:17
  Speaker 1: Explains why advertising has become a popular route to unlocking
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  Speaker 1: more revenue for streaming services.
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  Speaker 2: Heart We first saw Netflix enter the ad scene, and
• 4:24
  Speaker 2: they were soon joined by Disney Plus and Hulu and Hbo, Max, Amazon,
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  Speaker 2: Paramount Plus.
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  Speaker 1: And now potentially stand as well. Yep.
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  Speaker 2: But Josie, boy, the challenge with introducing ads to Stan
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  Speaker 2: is that it operates alongside Nine Entertainments free to air channels, which.
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  Speaker 1: Means it needs to make sure it doesn't pull revenue
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  Speaker 1: away and actually cannibalize Nine's free platforms.
• 4:44
  Speaker 2: For our third and final story, gooz Money Gomez, the
• 4:48
  Speaker 2: now ASX listed, a Mexican food chain, announced quarterly sales
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  Speaker 2: growth above it's already ambitious expectation.
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  Speaker 1: Holy Gogamally, somebody in Australia is eating a lot of burritos.
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  Speaker 1: Here be man, It's true and it's not me olu,
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  Speaker 1: so tell me more nuts.
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  Speaker 2: So Guzman Igomez is the Mexican style fast food chain
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  Speaker 2: that started in Sydney in two thousand and six.
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  Speaker 1: Yeah, their plan was to swap out sloppy taco is
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  Speaker 1: a fresh, tastier and healthier option, but still serve them
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  Speaker 1: with fast food speed. Sounds a little bit like a
• 5:16
  Speaker 1: Mexican macas. In June's year, gig became one of the
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  Speaker 1: most widely debated stocks to list on the share market.
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  Speaker 2: YEP listed at a market evaluation of three point three
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  Speaker 2: billion dollar.
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  Speaker 1: Dude. Some investors thought it was a burrito stuff too
• 5:29
  Speaker 1: full and it wouldn't meet its lofty targets. Others thought
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  Speaker 1: the price actually needed a little bit more salsa. But
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  Speaker 1: now GAG's announced that its sales have grown to over
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  Speaker 1: two hundred and seventy eight million dollars in the first
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  Speaker 1: three months of this financial year, and it.
• 5:42
  Speaker 2: Was on track to hit its prospectus forecasts.
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  Speaker 1: Interesting and a share price by the Babe Man also
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  Speaker 1: up more than twenty nine percent since it's listing, quite
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  Speaker 1: the fiesta for investors and jes it boy.
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  Speaker 2: A big reason for this is the limited number of
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  Speaker 2: shares available in the free float.
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  Speaker 1: Interesting, So tell me what is the key landing here?
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  Speaker 2: The free float first to the portion of a company's
• 6:02
  Speaker 2: shares that are available for trading by the general public.
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  Speaker 1: You see be man. A lower free float can create scarcity,
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  Speaker 1: which can drive up share.
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  Speaker 2: Prices, obviously because more investors are chasing fewer shares.
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  Speaker 1: But here's where it gets interesting. Because gug has a
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  Speaker 1: very limited free flow.
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  Speaker 2: Y yep, just fifteen percent of its stock is considered
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  Speaker 2: available to the public.
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  Speaker 1: And given its performance has been inline or sometimes better
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  Speaker 1: than expectation, investors have been gobbling up GAG shares and
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  Speaker 1: driving up the price quicker than you can say extra.
• 6:29
  Speaker 2: Guark aha, and as a result, Jasie Boyd, this has
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  Speaker 2: contributed to its rapid share price growth since its IPO.
• 6:35
  Speaker 1: Fox Am just wanted to thank you once again for
• 6:37
  Speaker 1: being such big supporters of Fox's app, podcast and newsletter
• 6:40
  Speaker 1: over the last few years.
• 6:42
  Speaker 2: And very excitingly, now that we're in by netwealth, it
• 6:44
  Speaker 2: means that we'll have even more resources to create and
• 6:47
  Speaker 2: do much much more. So stay tuned as we share
• 6:49
  Speaker 2: more exciting updates over their coming months.
• 6:52
  Speaker 1: Thanks for listening and we'll see you on Monday,