S&P cuts Russia’s rating
The Standard & Poor’s (S&P) credit agency yesterday cut Russia’s credit rating for the first time in more than five years, citing the capital flight and risk to investment in the wake of the Ukraine crisis. Russia’s economic growth slowed to 0.8 percent in the first quarter, sharply worse than earlier forecast while spooked investors pulled about US$70 billion out of the country — more than in all of last year. However, the cut in Russia’s rating from “BBB” to “BBB-” is the most tangible economic result of Russia’s policies toward Ukraine so far. “BBB-” is just a step above a speculative or non-investment grade.
Nokia excludes India plant
Nokia Oyj will exclude its India phone factory from a 5.44 billion euro (US$7.5 billion) agreement to sell its mobile phone business to Microsoft Corp amid a legal battle over a tax dispute in the country. “We are leaving out the plant because of the tax issues,” Poonam Kaul, a Nokia India spokeswoman, said by telephone on Thursday. The plant, one of the Espoo, Finland-based company’s largest phone factories, will make products for Microsoft as part of a servicing agreement, Kaul said.
Baidu profit surges 24.1%
Baidu Inc (百度), operator of China’s most popular Internet search engine, says its quarterly profit jumped 24.1 percent over a year earlier as its mobile business grew. The Beijing-based company yesterday said it earned 2.5 billion yuan (US$407.8 million) in the three months ending March 31. Revenue rose 59.1 percent to 9.5 billion yuan. In a statement, chairman Robin Li (李彥宏) cited success in search and app distribution for the growth and said Baidu wants to expand in new areas such as location-based services.
Amazon beats expectations
Amazon.com Inc posted higher-than-expected sales growth in the first quarter and boosted its investments in technology, content and warehouses as the e-commerce giant branches out into new businesses. Revenue rose 23 percent from a year ago to US$19.74 billion, more than the average analyst estimate of US$19.4 billion, according to Thomson Reuters I/B/E/S. The Seattle-based company reported net income of US$108 million, or US$0.23 per share. That compares with net income of US$82 million, or US$0.18 per share last year. Analysts expected US$0.21 per share, according to FactSet.
Honda profit jumps 56.4%
Japanese automaker Honda Motor Co yesterday said its fiscal year net profit soared to US$5.6 billion, thanks to brisk sales and a weaker yen. For the year to March, Honda said it booked a net profit of ￥574 billion, up 56.4 percent from a year earlier, while revenue rose about 20 percent to ￥11.84 trillion. The company forecast a profit of ￥595 billion for the current year to March 2015.
Bookmaker to reduce shops
William Hill PLC yesterday said it would close 109 of its British betting shops this year, blaming the decision on a tax increase on high stakes gambling machines. The firm, Britain’s largest bookmaker, said operating profit fell 14 percent in the first quarter of the year, hit by big payouts to gamblers on two weekends on which many of the top soccer sides had won. William Hill said the closure of the betting shops would put 420 jobs at risk and result in exceptional costs of up to ￡24 million (US$40.3 million).