TELECOMS
Nokia bucks supply crunch
Finnish telecoms giant Nokia Oyj yesterday reported a solid increase in profits last year and issued a confident outlook for the coming years as sales rose despite supply problems. “I would like to call it a transformational year,” CEO Pekka Lundmark told reporters after the group posted a net profit of 1.6 billion euros (US$1.8 billion), driven by a 1.6 percent increase in sales to 22.2 billion euros. “The board is proposing a 0.08 euro per share dividend for 2021 and we are also initiating a share buyback program to return up to 600 million euros over two years,” Lundmark said. Nokia also predicts a comparable operating margin of between 11 and 13.5 percent for this year, following 12.5 percent last year.
ELECTRONICS
Panasonic tests battery line
Panasonic Corp is renovating a facility in Japan to start testing mass production of a new type of lithium-ion battery that is championed by Tesla Inc as the key to unlocking cheaper electric vehicles. Panasonic will start test production of a next-generation “4680” battery at a facility in Wakayama Prefecture, chief financial officer Hirokazu Umeda said on Wednesday. The company will also set up a prototype production line for the batteries early this year in Japan. The CFO made the comments after Panasonic reported earnings, posting an operating profit of ￥73 billion (US$640 million) for the recently ended quarter.
TELECOMS
BT, Discovery talk sports
Britain’s BT Group said yesterday it had entered exclusive discussions with Discovery to create a joint venture between BT Sport and pan-European TV network Eurosport. Announcing the deal as it said COVID-19 and supply chain issues would hit revenue this year, BT opted to stay in sports television rather than going for an outright sale to streaming service DAZN, which had also made an offer. The new business would be a 50:50 joint venture, BT said, and would remain committed to retaining BT Sport’s existing major sport broadcast rights, such as Premier League soccer.
SHIPPING
Rates drop on China slack
A slowdown in China’s steel production is curbing demand for bulk ships to transport iron ore, driving a free-fall in global freight rates. Capesize rates to ship the steel-making raw material from Brazil to China have fallen 60 percent from October, according to the Baltic Exchange, while the widely watched global Dry Index has slumped 75 percent in the past four months. Shipping rates for every type of vessel from oil tankers to container vessels have fallen since October, easing inflationary pressure even as commodity prices climb.
CRYPTOCURRENCY
S Africa warns on exchanges
South Africa’s financial regulator said traders should be “cautious and vigilant” when using FTX Trading Ltd, one of the world’s fastest-growing crypto exchanges. The Financial Sector Conduct Authority on Wednesday issued two notices warning against dealing with Bahamas-headquartered FTX and Seychelles-based ByBit. It said the companies are not authorized to give financial advice or intermediary services in South Africa. The warnings come as South Africa scrambles to introduce new regulations for the crypto industry following two of the world’s largest fraud cases that originated from the country, with billions of dollars worth of bitcoin allegedly lost.
EUROZONE
Inflation vexes central bank
Record eurozone inflation was to feed a tense debate within European Central Bank over whether to raise interest rates when its policy-setting governing council met yesterday. Inflation unexpectedly rose to 5.1 percent in the euro area last month, figures from Eurostat showed on Wednesday, the highest value since records for the currency club began in 1997. Energy accounted for 28.6 percent of the inflation surge seen in the eurozone, Eurostat said. That weight has grown since December, when it was represented 25.9 percent of the overall price jump. Food, alcohol and tobacco accounted for 3.6 percent, also an increase over the previous month, while services jumped 2.4 percent.
EMPLOYMENT
US firms shed jobs
US private companies shed jobs last month for the first time since December 2020 as the Omicron variant of SARS-CoV-2 again complicated business — a potential harbinger of bad news for the upcoming government employment report. Data from payroll services firm ADP released on Wednesday said private employment declined by 301,000 last month, far worse than analysts expected, which the survey blamed squarely on the new virus strain. Small businesses bore the brunt of the employment downturn last month, losing 144,000 positions, the ADP data said. Large-business employment fell 98,000, while medium-sized businesses lost 59,000 positions.
BRAZIL
Rate into double digits
Brazil’s central bank hiked its benchmark interest rate by 1.5 points on Wednesday to 10.75 percent, bringing it into double digits for the first time in nearly five years to fight rampant inflation. The eighth straight increase to the Selic rate, which was in line with forecasts, comes as Latin America’s biggest economy struggles through a recession and stubbornly high inflation. The nine-member committee, which made the decision unanimously, hinted it would soon slow the tightening cycle, saying it “currently foresees a slowdown in the pace (of rate cuts) as the most adequate policy.”
TURKEY
Inflation at 20-year high
Turkey’s annual inflation rate in January reached its highest level since April 2002, official data showed yesterday, after a currency crisis decimated people’s purchasing power. Consumer prices surged by 48.7 percent from the same period in January last year, up from an annual rate of 36.1 percent in December, according to the Turkish statistics agency. However, independent data collected by Turkish economists suggested that the annual rate of inflation rose to more than 110 percent last month. President Recep Tayyip Erdogan admitted on Monday that Turks would “have to carry the burden” of inflation for “some time.”
BANKING
Santander eyes Mexico
Banco Santander SA expects to be among lenders exploring potential bids for Citigroup Inc’s retail banking operations in Mexico, chairman Ana Botin said in an interview. “When the process begins, we expect to be part of that process,” Botin said on Wednesday. While Santander is focused on organic growth, Mexico is a key market for the Spanish lender, she said in the interview on Bloomberg TV. Santander would not pay for a purchase by issuing new shares, as the bank’s priority is buying back its stock, Botin told analysts on a conference call. A deal there would make Santander a stronger challenger to Banco Bilbao Vizcaya Argentaria SA.
Taichung reported the steepest fall in completed home prices among the six special municipalities in the first quarter of this year, data compiled by Taiwan Realty Co (台灣房屋) showed yesterday. From January through last month, the average transaction price for completed homes in Taichung fell 8 percent from a year earlier to NT$299,000 (US$9,483) per ping (3.3m²), said Taiwan Realty, which compiled the data based on the government’s price registration platform. The decline could be attributed to many home buyers choosing relatively affordable used homes to live in themselves, instead of newly built homes in the city’s prime property market, Taiwan Realty
The government yesterday approved applications by Alphabet Inc’s Google to invest NT$27.08 billion (US$859.98 million) in Taiwan, the Ministry of Economic Affairs said in a statement. The Department of Investment Review approved two investments proposed by Google, with much of the funds to be used for data processing and electronic information supply services, as well as inventory procurement businesses in the semiconductor field, the ministry said. It marks the second consecutive year that Google has applied to increase its investment in Taiwan. Google plans to infuse NT$25.34 billion into Charter Investments Ltd (特許投資顧問) through its Singapore-based subsidiary Fructan Holdings Singapore Pte Ltd, and
JET JUICE: The war on Iran’s secondary effects have seen fuel prices skyrocket, knocking flight schedules down to earth in return as airlines struggle with costs Airline passengers should brace for more irritation in the next few months as carriers worldwide cancel flights and ground planes to cope with stratospheric increases in jet-fuel prices. Dutch flag carrier KLM is the latest company to cut its schedule, saying on Thursday that it would scrap 80 return flights at Amsterdam’s Schiphol Airport in the coming month. That puts it in the same league as United Airlines Holdings Inc, Deutsche Lufthansa AG and Cathay Pacific Airways Ltd, which have all pruned itineraries to mitigate costs. Global capacity for next month has been reduced by about 3 percentage points, with all
The US said it plans to help build a first-of-its-kind industrial hub in the Philippines to boost production of inputs crucial to US supply chains. The 4,000-acre hub is intended to be “a purpose-built platform for allied manufacturing” and “an investment acceleration hub where the specific industrial activities are shaped by market demand,” the US Department of State said on Thursday. The project — touted as an “economic security zone” — would be within the Luzon Economic Corridor, a flagship economic project backed by the US and Japan on the main Philippine island. The project was also described as “the first artificial intelligence
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