Sat, Feb 13, 2016 page6

• World Business Quick Take

  • Agencies
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  TELECOMS

  Singtel blames forex effect

  Singapore Telecom (Singtel) yesterday blamed the strength of the local currency when it announced that net profit fell 1.7 percent in the quarter ended Dec. 31. Net income reached S$954 million (US$683 million), down from S$970 million in the same period the previous year. Singtel, Southeast Asia’s biggest telecom firm by revenue, said the profit decline was mainly due to the Singapore dollar gaining against the currencies of countries where it has businesses. It also cited higher investment costs to strengthen its capabilities in a range of areas as a reason for the dip in profits. Group revenue came in at S$4.5 billion, up 1.1 percent, the company said in a statement.

  AUTOMAKERS

  Rolls-Royce cuts dividends

  Rolls-Royce Holdings PLC yesterday announced cuts to shareholder payments for the first time in almost 25 years and said it would need to deepen cuts amid sluggish sales of marine turbines and slumping demand for older wide-body jets. The engine-maker’s full-year dividend will fall to ￡0.164 from ￡0.231 for 2014, London-based Rolls-Royce said yesterday. The company maintained its outlook, after six profit warnings in two years. The first cut to Rolls-Royce’s annual dividend since 1992 places the engineer alongside companies including grocers Tesco PLC and J Sainsbury PLC, which are engaged in a price war, and platinum-miner Anglo American PLC, which has suffered as commodity prices plunge. Rolls-Royce’s share price has fallen 7.8 percent this year and has tumbled 39 percent since chief executive Warren East took over in July last year, reducing the company’s market value to ￡9.75 billion (US$14.11 billion).

  AIRLINES

  Thai Air’s A340s grounded

  Thai Airways International PCL will continue grounding 10 Airbus A340s it has not been able to sell because it still is not economical to fly the four-engine aircraft even after fuel prices plunged more than 40 percent in the past year. “The fuel consumption is so uneconomical,” president Charamporn Jotikasthira said in an interview in Bangkok on Thursday. “All new planes now have two engines that can fly as long as the four engines with much better fuel efficiency,” he said. The money-losing state-controlled airline is cutting routes and selling assets to bolster its balance sheet and operations. Thai Air also aims to boost the portion of revenue from bookings on its own Web site to 30 percent in the next few years, from 16 percent at present, Charamporn said.

  AUTOMAKERS

  India expects 12% growth

  India’s automakers are forecasting annual sales to grow at the fastest pace in six years, as rural consumers build wealth and step up purchases of cars and sport utility vehicles. Deliveries may gain as much as 12 percent in the financial year starting in April, Society of Indian Automobile Manufacturers director general Vishnu Mathur said yesterday in New Delhi. Sales in the year ending next month are on pace to rise about 8 percent. Buyers in rural India purchase about 35 percent of cars, SUVs and vans sold in the country. Mathur expects purchases will rise along with rural incomes. While automakers such as Maruti Suzuki India Ltd and Mahindra & Mahindra Ltd already each get about a third of their sales volume outside urban areas, Hyundai Motor Co and others are adding dealerships in the countryside as farmers boost their earnings.

  BANKING

  IMF planning Kenya loan

  The IMF plans to complete talks with Kenya within weeks for a two-year loan expected to be more than the US$680 million precautionary credit facility that expires next month. As in the concluding program, the new funds are to support Kenya in managing future economic shocks, IMF country representative Armando Morales said in an interview on Thursday. This one “will be bigger and with wider access,” he said from the capital, Nairobi. “The amount may increase. We are still seeing what is feasible. We want to make as much resources available as much as we know the needs.”

  BANKING

  Commerzbank profits surge

  Commerzbank, Germany’s second-largest bank, yesterday said that its profits quadrupled last year and it would resume dividend payments as it expects to see further profit growth this year. Last year, the bank made a net profit of 1.06 billion euros (US$1.2 billion), compared with 266 million euros the previous year, Commerzbank said in a statement. The profits were slightly bigger than analysts had expected. Revenue totaled 9.762 billion euros last year, an increase of 11 percent year-on-year, and underlying or operating profit tripled to 1.9 billion euros, Commerzbank calculated. The group said investment in its retail banking business was paying off, with underlying profits in that division doubling last year.

  ENERGY

  Total cuts investment target

  French oil company Total on Thursday cut its investment target this year, as it steps up efforts to drastically cut costs to counter a global collapse in crude oil prices. Total said it would invest up to US$2 billion less this year than originally planned, as it, like other oil giants, grapples with weak crude oil prices, which have slumped about 70 percent since mid-2014 due to chronic oversupply and on Thursday fell close to 13-year lows. It is to invest only US$19 billion compared with its earlier plan of US$20 billion to US$21 billion, and down from the US$23 billion it plowed into investments last year, it said in a statement. From next year, the figure would fall to US$17 billion to US$19 billion, it said.

  BEVERAGES

  PepsiCo warns on profit

  PepsiCo Inc said profit this year would rise about 2 percent as the strong US dollar weighs on revenue abroad, nearly offsetting gains in its North American businesses. Earnings this year would be US$4.66 a share, excluding some items, up from US$4.57 last year, the Purchase, New York-based company said in a statement on Thursday. Analysts are forecasting US$4.76 for this year, on average. The US dollar’s two-year surge has reduced the value of PepsiCo’s results abroad when translated back into the US currency. The firm expects that trend to continue this year, projecting that exchange-rate effects would reduce profit by 4 percent.

  INTERNET

  Pandora Media mulling sale

  Pandora Media, the largest Internet radio service, has held discussions about selling the company, according to people briefed on the talks. Pandora is working with Morgan Stanley to meet with potential buyers, said the people, who spoke on condition of anonymity because they were discussing private matters. The talks are preliminary and may not lead to a deal, they said. For Pandora, it would be a curious time to sell. Its shares are yielding a market value of US$1.8 billion, down from more than US$7 billion two years ago. The stock has fallen more than 60 percent since October last year.
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