ENVIRONMENT
China oil spill deal reached
ConocoPhillips says that it and China National Offshore Oil Corp (中國海洋石油) have reached a US$160 million agreement to settle compensation claims from oil spills off northeastern China. The Houston-based company said in a statement yesterday that the two reached an agreement with China’s Ministry of Agriculture over the oil spills in June last year in the Bohai Sea. The spills were considered small, especially compared with the Gulf of Mexico spills in 2010, but Conoco as operator of the Bohai field still came under intense media criticism in China. Conoco said the money would be used to settle public and private claims of potentially affected fishermen in relevant Bohai Bay communities.
SINGAPORE
Inflation stays above 5%
Singapore’s inflation rate exceeded 5 percent for a seventh month, and policymakers said prices will remain “elevated.” The consumer price index rose 5.5 percent last month from a year earlier, the Department of Statistics said in a statement yesterday. Inflation was 5.7 percent in November, according to previously reported data. Price gains averaged 5.2 percent last year, the government said.
AUSTRALIA
Q4 inflation held steady
Australian inflation held steady in the fourth quarter, data showed yesterday, a lower-than-expected result that stoked hopes for an interest-rate cut to boost a “quite sluggish” economy. The Consumer Price Index was flat in the three months to last month from the previous quarter, and 3.1 percent for last year, the Australian Bureau of Statistics (ABS) said. Analysts had forecast rates of 0.2 percent and 3.3 percent respectively.
NATURAL GAS
Uzbekistan loan approved
The Asian Development Bank said yesterday it has approved a loan and political risk guarantee of up to US$400 million for a project to build Uzbekistan’s largest-ever petrochemical plant, which is expected to be operational in early 2016. The bank said the Surgil Natural Gas Chemicals Project would produce gas for commercial use and for conversion into chemical intermediates used in the plastics and textiles industries. Developer and operator Uz-Kor Gas Chemical of the project in the Karakalpakstan region is a joint venture between state-controlled National Holding Company Uzbekneftegaz and a consortium of South Korean firms — Honam Petrochemical Corp, the Korea Gas Corp and STX Energy.
STEEL
Japanese output may wane
Japan’s steel output may decline by between 2 million and 3 million tonnes this year, Japan Iron and Steel Federation chairman Eiji Hayashida said yesterday at a press briefing in Tokyo. Production of steel last year totaled 107.6 million tonnes, the federation said earlier. Tokyo Electric Power Co’s recent decision to increase prices for corporate customers will raise annual costs for steelmakers by about ￥20 billion (US$257 million), Hayashida said.
AVIATION
HK passenger traffic up 5.9%
The number of passengers handled by Hong Kong International Airport rose 5.9 percent last year from a year earlier to 53.9 million, the territory’s Airport Authority said in a statement on its Web site yesterday. Annual cargo performance decreased 4.6 percent to 3.9 million tonnes over the same period, the authority said, citing decreased exports.
WIRELESS
LM Ericsson Q4 profit drops
Swedish wireless equipment maker LM Ericsson AB says fourth-quarter profits fell by more than two-thirds compared with a year earlier due to a severe margin squeeze and bigger losses in its Sony Ericsson joint venture. The company yesterday reported a net profit for the fourth quarter of 1.15 billion kronor (US$170 million), down from 4.32 billion kronor in the October-December period in the previous year. Sales in the three-month period rose by 1 percent to 63.67 billion kronor — not enough to offset heavier pressure on its gross margin, which fell to 30.2 percent from a previous 34.7 percent. Losses in the Sony Ericsson joint venture also hurt the Stockholm-based company. Ericsson last year sold its share in Sony Ericsson to Sony, but the deal is being finalized in this quarter.
MICROPROCESSORS
AMD forecasts sales decline
Advanced Micro Devices Inc (AMD), the second-largest maker of processors for personal computers, forecast lower sales than some analysts had estimated, hurt by supply shortages and slower demand for PCs. First-quarter sales will decrease as much as 11 percent from the previous three months, the company said on Tuesday. That indicates revenue of as little as US$1.5 billion, compared with the US$1.6 billion average estimate of analysts surveyed by Bloomberg. The company reported a fourth-quarter net loss of US$177 million, or US$0.24 a share, compared with a profit of US$375 million, or US$0.50, a year earlier. Sales rose 2.5 percent to US$1.69 billion in the period. Gross margin was 46 percent. That compares with 45 percent in the fourth quarter of 2010.
SOFTWARE
SAP than doubles profit
Business software maker SAP says net profit more than doubled in the fourth quarter to 1.2 billion euros (US$1.56 billion). Revenues rose 11 percent to 4.50 billion euros from the same quarter a year earlier. The company yesterday reported a 16 percent increase in software sales, to 1.74 billion euros. That is a key figue for SAP, because software sales mean more support service revenue down the road.
PHARMACEUTICALS
Costs sap Novartis profit
Swiss drug maker Novartis AG yesterday reported a 47 percent drop in its fourth-quarter net profit, citing a slate of exceptional costs from the ending of clinical trials, manufacturing problems and layoffs. The Basel-based company said its net profit reached US$1.21 billion in the fourth quarter, compared with US$2.32 billion in the same period in 2010. Sales rose 4 percent to US$14.78 billion in the October-December period. For the full year, Novartis reported a net profit of US$9.25 billion, down 7 percent from US$9.97 billion the previous year.
STEEL
Arcelor Mittal shelves plant
The world’s largest steelmaker, Arcelor Mittal, on Tuesday confirmed it is closing a steel plant in Madrid, but would redeploy more than 330 staff elsewhere in Spain, a union source said. Union leader Edouard Martin said in Luxembourg after talks with company managers that Arcelor Mittal bosses left open the possibility of the site re-opening at a later date “if market conditions allow.” The union representative said that the company refused to discuss other possible closures in Europe amid concern over sites in Luxembourg, where a plant was mothballed in October, Poland and the Czech Republic.
State-run CPC Corp, Taiwan (CPC, 台灣中油) yesterday signed a letter of intent with Alaska Gasline Development Corp (AGDC), expressing an interest to buy liquefied natural gas (LNG) and invest in the latter’s Alaska LNG project, the Ministry of Economic Affairs said in a statement. Under the agreement, CPC is to participate in the project’s upstream gas investment to secure stable energy resources for Taiwan, the ministry said. The Alaska LNG project is jointly promoted by AGDC and major developer Glenfarne Group LLC, as Alaska plans to export up to 20 million tonnes of LNG annually from 2031. It involves constructing an 1,290km
NEXT GENERATION: The company also showcased automated machines, including a nursing robot called Nurabot, which is to enter service at a Taichung hospital this year Hon Hai Precision Industry Co (鴻海精密) expects server revenue to exceed its iPhone revenue within two years, with the possibility of achieving this goal as early as this year, chairman Young Liu (劉揚偉) said on Tuesday at Nvidia Corp’s annual technology conference in San Jose, California. AI would be the primary focus this year for the company, also known as Foxconn Technology Group (富士康科技集團), as rapidly advancing AI applications are driving up demand for AI servers, Liu said. The production and shipment of Nvidia’s GB200 chips and the anticipated launch of GB300 chips in the second half of the year would propel
‘MAKE OR BREAK’: Nvidia shares remain down more than 9 percent, but investors are hoping CEO Jensen Huang’s speech can stave off fears that the sales boom is peaking Shares in Nvidia Corp’s Taiwanese suppliers mostly closed higher yesterday on hopes that the US artificial intelligence (AI) chip designer would showcase next-generation technologies at its annual AI conference slated to open later in the day. The GPU Technology Conference (GTC) in California is to feature developers, engineers, researchers, inventors and information technology professionals, and would focus on AI, computer graphics, data science, machine learning and autonomous machines. The event comes at a make-or-break moment for the firm, as it heads into the next few quarters, with Nvidia CEO Jensen Huang’s (黃仁勳) keynote speech today seen as having the ability to
WAIT-AND-SEE: Last month’s consumer price index came in at 2.8%, which boosts expectations that the Fed would proceed cautiously to lower inflation sustainably The US Federal Reserve is widely expected to keep interest rates unchanged at its policy meeting this week, treading carefully amid uncertainty over US President Donald Trump’s economic policies, which include spending cuts and sweeping tariffs. Since January, Trump has imposed levies on major trading partners Canada, Mexico and China, and on steel and aluminum imports, roiling financial markets and fanning fears that his plans could tip the world’s biggest economy into a recession. The Trump administration has also embarked on unprecedented cost-cutting efforts that target staff and spending, while the US president has promised tax reductions and deregulation down the road. However,
RSS