TELECOMS
Vodafone back in the black
British giant Vodafone yesterday announced a return to annual profit, as it revealed that long-serving chief executive Vittorio Colao would step down later this year. Chief financial officer Nick Read is to succeed Colao from October, with the announcement coming less than a week after Vodafone unveiled a deal to turn it into Europe’s largest cable and broadband operator by buying assets from US peer Liberty Global. Vodafone posted a net profit of 2.4 billion euros (US$2.9 billion) in the 12 months to the end of March, which compared with a loss after tax of 6.3 billion euros the previous year, the group said in a statement. The turnaround pointed to a “year of significant operational and strategic achievement, and strong financial performance,” Colao said.
VIETNAM
Fitch upgrades rating
The nation won a sovereign rating upgrade from Fitch Ratings on strong economic growth and rising foreign-exchange reserves and. The rating on the nation’s long-term, foreign currency-denominated debt was raised one level to “BB,” with a stable outlook, Fitch said in a statement yesterday. The upgrade puts Vietnam at the second-highest speculative grade and on a par with Costa Rica. The government has committed to containing debt and reforming its state-owned enterprises, boosting its track record of policymaking. Reserves are forecast to climb to about US$66 billion by the end of this year from US$49 billion last year, while general government debt is likely to decline to below 50 percent of GDP by next year, according to Fitch calculations.
CHINA
Investment, sales weak
The government reported weaker-than-expected investment and retail sales last month, and a drop in home sales, clouding its economic outlook. Fixed asset investment grew the slowest since 1999 and the pace of retail sales softened to a four-month low, data showed yesterday, suggesting a loss of momentum in the world’s second-largest economy following generally soft readings in March. The lone bright spot was industrial output, which jumped more than expected as the automobile sector rebounded and steel production surged. Industrial output rose 7 percent last month, the National Bureau of Statistics said, from a seven-month low of 6 percent in March. The statistics bureau said Sino-US trade frictions have yet to make an impact on the economy.
AUTOMAKERS
Tesla unveils reorganization
Tesla chief executive Elon Musk on Monday told employees that the electric automaker is being reorganized to speed up production of Model 3 vehicles — a key to profitability at the fast-growing firm. “We are flattening the management structure to improve communication, combining functions where sensible and trimming activities that are not vital to the success of our mission,” Musk said in an internal note. Musk said Tesla is on the road to hitting goals in coming months for the more affordable Model 3 and achieving profitability by the end of this year.
INSURANCE
Allianz profit up 6.8%
Allianz SE’s first-quarter profit rose 6.8 percent, boosted by US President Donald Trump’s changes to US corporate tax and lower restructuring charges. Income from property and casualty premiums rose as customers opted for more coverage after last year’s US hurricanes and California wildfires contributed to a record year for losses.
Agencies
Nissan Motor Co has agreed to sell its global headquarters in Yokohama for ￥97 billion (US$630 million) to a group sponsored by Taiwanese autoparts maker Minth Group (敏實集團), as the struggling automaker seeks to shore up its financial position. The acquisition is led by a special purchase company managed by KJR Management Ltd, a Japanese real-estate unit of private equity giant KKR & Co, people familiar with the matter said. KJR said it would act as asset manager together with Mizuho Real Estate Management Co. Nissan is undergoing a broad cost-cutting campaign by eliminating jobs and shuttering plants as it grapples
TEMPORARY TRUCE: China has made concessions to ease rare earth trade controls, among others, while Washington holds fire on a 100% tariff on all Chinese goods China is effectively suspending implementation of additional export controls on rare earth metals and terminating investigations targeting US companies in the semiconductor supply chain, the White House announced. The White House on Saturday issued a fact sheet outlining some details of the trade pact agreed to earlier in the week by US President Donald Trump and Chinese President Xi Jinping (習近平) that aimed to ease tensions between the world’s two largest economies. Under the deal, China is to issue general licenses valid for exports of rare earths, gallium, germanium, antimony and graphite “for the benefit of US end users and their suppliers
Dutch chipmaker Nexperia BV’s China unit yesterday said that it had established sufficient inventories of finished goods and works-in-progress, and that its supply chain remained secure and stable after its parent halted wafer supplies. The Dutch company suspended supplies of wafers to its Chinese assembly plant a week ago, calling it “a direct consequence of the local management’s recent failure to comply with the agreed contractual payment terms,” Reuters reported on Friday last week. Its China unit called Nexperia’s suspension “unilateral” and “extremely irresponsible,” adding that the Dutch parent’s claim about contractual payment was “misleading and highly deceptive,” according to a statement
The Chinese government has issued guidance requiring new data center projects that have received any state funds to only use domestically made artificial intelligence (AI) chips, two sources familiar with the matter told Reuters. In recent weeks, Chinese regulatory authorities have ordered such data centers that are less than 30 percent complete to remove all installed foreign chips, or cancel plans to purchase them, while projects in a more advanced stage would be decided on a case-by-case basis, the sources said. The move could represent one of China’s most aggressive steps yet to eliminate foreign technology from its critical infrastructure amid a
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