Swatch’s China sales revive
Swatch Group AG said sales in China are rebounding this month after slumping 50 percent last month due to lockdowns followed by a wave of COVID infections. A shortfall of 700 million Swiss francs (US$760 million) of revenue due to the situation in China led the company to report slower-than-expected earnings growth, with operating profit up 13 percent. Revenue could reach a record 9 billion francs this year, chief executive officer Nick Hayek said in an interview. Swatch reported net sales of SF7.5 billion, an increase of 4.6 percent compared with the previous year at constant exchange rates. Analysts expected SF7.73 billion.
Maruti Suzuki profit doubles
Maruti Suzuki India Ltd reported a higher-than-expected profit in the latest quarter as car sales rebounded and supply chain issues eased. Net income for India’s largest carmaker more than doubled to 23.5 billion rupees (US$288 million) for the three months ended Dec. 31, the unit of Japan’s Suzuki Motor Corp said in an exchange filing yesterday, beating the average analyst estimate of 18.51 billion rupees forecast by a Bloomberg survey of brokerages. Revenue also topped estimates, rose 25 percent to 290.4 billion rupees. Total costs surged 21 percent to 269.5 billion rupees, according to the filing.
Consumer confidence up
German consumer confidence improved at the start of the new year, a key survey showed yesterday, as government support measures help keep the lid on energy costs. Pollster GfK said its forward-looking survey of around 2,000 people climbed 3.7 points to reach minus-33.9 points for February, the fourth consecutive monthly increase. “Falling prices for energy, such as gasoline and heating oil, have ensured that consumer sentiment is less gloomy,” GfK consumer expert Rolf Buerkl said. He warned that the indicator was still at a “very low level” overall and that the months ahead would remain “difficult” for Europe’s top economy.
Portugal home prices soar
Home prices in Portugal had the biggest annual rise in more than three decades, defying expectations that rising interest rates would dampen demand for property in the southern European nation. House prices increased 18.7 percent last year from the previous year, Confidencial Imobiliario, which collects data on the property market, said in an e-mail. While the annual gains are the biggest since 1991, Confidencial said its data also indicated that the country’s housing market was slowing down. Still, data showed that home-price gains in Portugal slowed over a quarter-on-quarter basis toward the end of last year.
Sri Lanka offered a deal
The Export-Import Bank of China has offered Sri Lanka a two-year moratorium on its debt and said it will support the country’s efforts to secure a US$2.9 billion loan from the IMF, according to a letter reviewed by Reuters. The Export-Import Bank of China said it would provide an extension on the debt service due last year and this year as an immediate contingency measure based on Sri Lanka’s request, the letter said. At the end of 2020, the bank had loaned Sri Lanka US$2.83 billion, which is 3.5 percent of the island’s debt, according to an IMF report released in March last year.
UK offers furnace grants
Britain will offer grants to help its two largest steelmakers replace dirty blast furnaces with less carbon-intensive technology, media reported on Monday. The BBC reported that grants worth ￡600 million (US$744 million) will “likely” be unveiled this week for Chinese-owned British Steel Ltd and Indian-owned Tata Steel UK Ltd, to help slash damaging emissions, cut fuel bills and protect thousands of jobs. British Steel and Tata Steel operate Britain’s four remaining steel blast furnaces. However, London reportedly wants the pair to switch to electric arc furnaces, which the BBC reports could recycle the scrap steel Britain produces and be powered by electricity from renewable sources.
UK falling behind: CBI
Britain is falling behind global competitors in green investment growth, the Confederation of British Industry (CBI) warned on Monday, urging action to soften the blow of recession. The business lobby’s head Tony Danker in a speech called on British Chancellor of the Exchequer Jeremy Hunt to make “big decisions” on green investment to “get growth going.” “Our international competitors in Europe, Asia and the United States are going hell for leather on green growth and getting firms investing,” Danker said in the speech in London. “We are behind them now and seem to be hoping for the best.”
Serta files for Chapter 11
Serta Simmons Bedding is seeking bankruptcy protection in an effort to trim its debt load following an earlier out-of-court restructuring. The Atlanta-based mattress maker filed in the Southern District of Texas, listing assets and liabilities of US$1 billion to US$10 billion in its bankruptcy petition. The Chapter 11 filing allows Serta to continue operating while working out a plan to repay creditors. The company’s debt, which stems from a roughly US$3 billion leveraged buyout by Advent International in 2012, has hobbled the retailer. Confidential talks over a restructuring plan started late last year, Bloomberg earlier reported.
Germany scrutinizes PayPal
Germany’s antitrust regulator opened an investigation into PayPal Holdings Inc over potential obstruction of competitors and restriction of price competition. The Federal Cartel Office is looking at PayPal’s user terms that block businesses from offering products at lower prices if their customers chose other payment services. The regulator will also look at how the company bans sellers from making it more convenient to use other payment methods than PayPal. “We will now examine what market power PayPal has and to what extent online retailers are dependent on offering PayPal as a payment method,” said Andreas Mundt, the Cartel Office’s head.
BlockFi to sell loans
Bankrupt crypto lender BlockFi Inc plans to sell about US$160 million of loans backed by around 68,000 bitcoin mining machines, according to two people familiar with the matter. The US company, which filed for protection from creditors in November last year, started on the bidding process for the loans last year, the people said. Some of the loans have already defaulted and appear to be undercollateralized given the current prices of bitcoin mining equipment, the people said. BlockFi is among several digital-asset lenders that have filed for bankruptcy in the past year.
CONSIDERATIONS: The NSTC instructed the park to assist laid-off workers and urge companies to use furlough programs to ease the effects of falling demand Firms in the Hsinchu Science Park (新竹科學園區), which houses major tech companies, reported laying off 496 employees last month amid weakened global demand, Hsinchu Science Park Bureau director-general Wayne Wang (王永壯) said yesterday. Wang told a news conference that 48 companies in the science park laid off employees last month, including one hard disk supplier which let go 241 employees as part of a plant closure due to falling demand. Other companies reported sporadic layoffs as they adjusted to weakening demand, he said. Wang made the remarks after local media reported the layoffs over the weekend. Although the global economy is struggling with high
DEJA VU: Echoing the probe into real-estate giant Evergrande Group, the bank is under Beijing police scrutiny after last week, telling investors it is ‘severely insolvent’ Chinese authorities said they recently opened criminal investigations into Zhongzhi Enterprise Group Co’s (中植企業) money management business, days after the embattled shadow banking giant revealed a shortfall of US$36.4 billion in its balance sheet. Police in Beijing said in a statement on WeChat that they took “criminal mandatory measures” against multiple suspects, identifying one by their last name, Xie (解). They urged investors to report cases or provide leads to the authorities, including filing complaints online. Xie Zhikun (解直錕), the group’s founder, died in 2021, but several of his relatives are executives at the company. The statement did not elaborate on what
German Chancellor Olaf Scholz and German Minister for Economic Affairs and Climate Action Robert Habeck have promised to solve investment subsidy issues for Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and Intel Corp, despite the country’s budget woes. Uncertainty over the funding to TSMC and Intel has arisen after a ruling by the German Federal Constitutional Court, which cast doubt over subsidies for construction of local semiconductor chip plants. On Nov. 15, the court ruled that the German government’s decision last year to reallocate 60 billion euros (US$65.74 billion) of unused funding from COVID-19 pandemic support measures to its Climate and Transformation Fund
NEW TREAD: The Taiwanese shoe brand paired with TSMC to turn silicon waste into a circular economy good, following its success making shoes from coffee grounds Ccilu International Inc (馳綠國際), a Taiwan-based footwear brand, has become the first company in the world to turn silicon waste from contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) into eco-friendly shoes. Last year, the global footwear industry saw the first pair of pressure-relief slippers made from recycled silicon waste by Ccilu. The brand continued to unveil follow-up collections, including sports shoes and massage slippers made from the same materials. In an interview with CNA, Ccilu CEO Wilson Hsu (許佳鳴) recalled the company’s innovation of the first pair of slippers made from silicon waste after its silicon waste treatment partner, Semisils Applied Materials