TELECOMS
Sprint woes sap Softbank
Japanese telecommunications and Internet company Softbank Group Corp is reporting an 88 percent drop in fiscal third quarter profit as it struggles to turn around its US carrier Sprint Corp. The Japanese firm reported a ￥2.3 billion (US$20 billion) profit for the October-December period, down from ￥18.7 billion during the same period a year earlier. While facing a challenge with money-losing Sprint, Softbank said it is on track to cut US$800 million in costs for fiscal 2015, slashing 2,500 jobs since the fall, or 8 percent of its workforce.
AUTOMAKERS
Nissan beats estimates
Nissan Motor Co reported profit that beat analyst estimates as the Rogue crossover drove increased demand in the US, the Japanese automaker’s biggest market. Net income in the quarter through December rose to ￥127.2 billion, the company said yesterday. The carmaker topped the ￥120.6 billion average of eight analysts’ estimates compiled by Bloomberg. Nissan said its third-quarter sales climbed to ￥3.01 trillion, while operating profit climbed to ￥192.6 billion. It maintained full-year forecast for ￥535 billion in net income and ￥12.25 trillion in sales.
BANKING
Commonwealth profit up 2%
Australia’s biggest company, Commonwealth Bank, yesterday posted a modest 2 percent rise in first-half net profit to A$4.62 billion (US$3.26 billion). Cash profit for the six months to Dec. 31, a measure often preferred by financial institutions, rose 4 percent to A$4.80 billion, slightly higher than analyst expectations. Chief executive Ian Narev emphasized the bank’s balance sheet strength in positioning the country’s largest lender to handle economic instability.
SOLAR POWER
Panasonic to cut production
Panasonic Corp will suspend production of solar cells and modules at a plant in Osaka amid slowing demand for the residential market in Japan. The company plans to halt production from the end of this month and expects to restart in November, spokeswoman Yayoi Watanabe said by telephone. Most products made at the plant are for rooftops, she said. The company announced last year that it will invest ￥9.5 billion to boost production capacity by 150 megawatts at its two other domestic factories in Shimane and Shiga prefectures.
INVESTMENT
Goldman mulls cost cuts
Goldman Sachs Group Inc is weighing cost cuts to deal with a slowing global economy, its chief executive Lloyd Blankfein said on Tuesday. A person with knowledge of the situation said Goldman intends to slash at least 5 percent of its total workforce this year. Speaking a day after Goldman shares plunged 4.6 percent amid rising market worries over credit quality in banks, Blankfein said that the bank can “absolutely do a lot more on the cost side if we have to.”
FURNITURE
IKEA recalls risky lamps
Swedish furniture retailer IKEA is recalling two types of ceiling lamps, “Lock” and “Hyby,” because of a risk that the glass shades might fall and injure people. The company on Tuesday apologized for the inconvenience and said customers do not need to produce a receipt to prove purchase of the items for a refund. IKEA has been selling “Lock” lamps in all its markets since 2002 and the “Hyby” models since 2012.
AUTOMAKERS
Daimler issues recall
Daimler AG is recalling 840,000 vehicles in the US because they have potentially defective driver’s side air bags made by Takata Corp. The recall affects Mercedes-Benz cars and SUVs from the 2005-2014 model years, including C-Class, E-Class, SLK and SLS sedans and M-Class, GL-Class and R-Class SUVS. It also includes 2007-2014 Sprinter and Freightliner vans. Daimler says the recall is precautionary and no one has been injured in any of its vehicles. The company has booked a US$384 million charge to pay for repairs.
ACCESSORIES
Swatch to sell sunglasses
Swatch Group AG will introduce sunglasses under its namesake brand this year under a five-year alliance with Safilo Group SpA, the companies said on Tuesday. The Swiss watchmaker will help the Italian company design collections that will be available in the spring. The diversification comes as the Swiss watch industry struggles to sell more timepieces amid slowing economic growth in its biggest market, China.
CONGLOMERATES
Oil, shipping sap Maersk
A.P. Moeller-Maersk A/S yesterday reported an 84 percent plunge in profit for last year after its oil unit was hit by lower energy prices and its container division got squeezed between sluggish trade growth and overcapacity. Maersk said net income was US$791 million last year compared with US$5.02 billion in 2014. That compares with a median estimate of US$3.7 billion by analysts. The result includes a writedown in the value of Maersk’s oil assets by US$2.6 billion, the Copenhagen-based company said. Maersk said this year’s underlying profit will be “significantly below” last year’s US$3.1 billion.
AGRICULTURE
Mogul buys mega-ranch
A billionaire sports mogul has purchased a Texas mega-ranch that has been operated by one family for nearly a century. The heirs of cattle baron W.T. Waggoner said on Tuesday that a judge permitted the sale to Los Angeles Rams owner Stan Kroenke for an undisclosed sum. The ranch had been listed for US$725 million when it hit the market in August 2014. The Waggoner Ranch is about 280km northwest of Dallas.
BREWING
US, Asia boost brewers
Heineken NV and Carlsberg A/S, the world’s third and fourth-largest brewers, forecast higher profit this year fueled by markets such as the US and Asia. Sales and profit will both increase this year even with an “increasingly challenging external environment,” Heineken said yesterday. Profit before some items rose 16 percent to 2.05 billion euros (US$2.32 billion) last year, it said. Carlsberg forecast operating profit will rise by a low single-digit percentage on an organic basis as the company reported fourth-quarter earnings falling 21 percent to 1.41 billion kroner (US$210 million) that beat analysts’ estimates.
LUXURY GOODS
Hermes may miss target
French luxury-handbag maker Hermes International SCA added to the industry’s recent woes, saying sales growth this year may miss its medium-term target. Revenue could rise by less than the company’s goal of 8 percent at constant exchange rates, Hermes said yesterday, citing “economic, geopolitical and monetary uncertainties around the world.” Hermes also reported its slowest sales growth in six years as November’s Paris terrorist attacks led to a drop in tourist spending. Revenue climbed 7.2 percent on that basis, the company said.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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