Mining and pizza feed a $25bn increase for the wealthy

Three key trends are emerging in Australian business during COVID-19: iron ore exports, food and e-commerce

Mining magnate Gina Rinehart is the wealthiest person on The List, six months after the 2020 edition was published and a period of tumult on global stockmarkets that has seen some industries thrive and others dive.

Call it the iron ore and pizza box boom.

The 25 richest Australians have added $25bn to their combined wealth during the COVID-19 pandemic, and the country has a new No 1 on The List — Australia’s Richest 250.

Mining magnate Gina Rinehart is the wealthiest person on The List, six months after the 2020 edition was published and a period of tumult on global stockmarkets that has seen some industries thrive and others dive.

A recalculation of The List shows three particular trends: iron ore prices have caused a spike in wealth for the mining magnates, e-commerce and home food deliveries are booming for the billionaires in those industries, and remote working during the pandemic has rapidly increased the fortunes of the tech billionaires.

The wealth of Mrs Rinehart and fellow iron ore billionaire Andrew Forrest has increased by a combined $15bn in six months. Shares in Mr Forrest’s Fortescue Metals have surged about 80 per cent in the same period, and he will receive a $1.16bn dividend cheque on October 2.

Meanwhile, Jack Cowin’s shareholding in Domino’s Pizza Enterprises is up $600m as more Australians order food for home delivery, and even revenue at his Hungry Jack’s fast food chain has increased as more customers get their burgers delivered or collect their meals via drive-through.

That trend, and a boom in home shopping and e-commerce, has seen Anthony Pratt’s cardboard box and recycling giant Visy and its US sister company Pratt Industries achieve record profits. Mr Pratt, who supplies the pizza boxes for Domino’s, spent $1bn to buy the Australasian business of glassmaker Owens-Illinois and has seen his wealth rise $2.7bn.

That still isn’t enough to maintain the title of Australia’s wealthiest person. Mrs Rinehart is No 1 with an estimated $6bn increase in her wealth in six months to $22.25bn, while Mr Forrest is second at $22.11bn, up $9.05bn since March. Mr Pratt is third at $19.65bn.

Mrs Rinehart’s privately held Hancock Prospecting is likely to unveil a record profit when its accounts are revealed later this year as the price of iron ore has kept rising and exports to China from WA have remained mostly unhindered by COVID-19. Hancock will also probably deliver a corporate tax cheque well above $1bn to the federal government.

Two months ago, 40-year-old technology sensations Mike Cannon-Brookes and Scott Farquhar looked headed for the top of The List as shares in their Nasdaq-listed Atlassian rocketed in value.

Mike Cannon-Brookes. Picture: John Feder/The Australian.

Atlassian has become a market darling with its collaborative software gaining in popularity with more corporations having more staff working from home.

But as the share prices of global tech giants such as Apple have dipped in the past two weeks, so has Atlassian stock. It has fallen 15 per cent since the start of September, though Mr Cannon-Brookes and Mr Farquhar’s combined wealth is still up almost $4bn since March.

The tech and e-commerce sectors account for other notable success stories on The List. Australia’s youngest billionaire in Melanie Perkins, the co-founder of Canva, saw her combined wealth with Cliff Obrecht almost double to $2.5bn after her online graphics firm raised more funds from its investors in June. At that level Ms Perkins, 32, is now just outside the top 25 on The List.

But not every industry is thriving. The wealthy elite with their fortune tied to property, especially shopping centres have taken a hit, as have those in industries reliant on getting customers through their doors. COVID-19 therefore has seen casinos and resorts magnate James Packer suffer a cut in wealth, as has poker machines billionaire Len Ainsworth.

Billionaire shopping centre magnate John Gandel has seen the value of his huge Chadstone centre in Melbourne’s southeast marked down when its half-owner Vicinity Centres — which Mr Gandel also holds a large stake in — revalued the asset in August.

Mr Packer’s Crown Resorts has suffered a share price fall with its key Melbourne casino forced to shut its doors during Victoria’s lockdown.

Similarly, Kerry Stokes’s stake in Seven Group fell markedly in March and while it has recovered since it is still well off its 2020 high. His Beach Energy shares have also fallen.

Australia’s oldest billionaire, the 96-year-old Len Ainsworth, alongside his family holds large shareholdings in Aristocrat Leisure. While it has had a stellar run in recent years, shares in the poker machine manufacturer have fallen in recent months as gaming venues around the world have been shut or faced visitor restrictions.

Meanwhile, London-based billionaire Michael Hintze’s hedge fund is reportedly down 42.5 per cent this year. Funds under management at his CQS are down about $US1bn ($1.36bn) in six months, hitting the estimated value of Mr Hintze’s wealth.